HLNE - Earnings call transcript Q1 2022 | Hamilton Lane Incorporated

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Operator

Thank you all for standing by, and welcome to the Hamilton Lane Incorporated First Quarter Fiscal Year 2022 Earnings Conference Call. [Operator Instructions] I'll now turn the call over to your host, Vice President of Investor Relations, John Oh. Sir, you may now begin.

John Oh

Thank you, Jesse. Good morning, and welcome to the Hamilton Lane Q1 Fiscal 2022 Earnings Call. joined Atul Giannini, Varma, be Vice Erik will and Chairman; CFO. I by CEO; Mario Hirsch, Today,

Before we statements materially. discuss statements may remind current you cause the for are quarter's results, we expectations results and be we subject will the to making uncertainties business. actual forward-looking the based risks our that on These want that to differ to

subsequent XX-K in these we and For review included Lane's please the of with reports factors risks, the a as fiscal SEC. XXXX discussion risk the Hamilton amended filed

will non-GAAP Shareholders the We in the measures we of section view to Reconciliation also our of measures Lane the found of be earnings assessing the Hamilton in presentation that GAAP be referring can non-GAAP those materials to as made website. performance business. on important available

will of Lane's results call on nothing made a solicitation interest be note our to to or available on this Please filed. XX-Q sell Hamilton financial purchase detailed products. any Our Beginning is Slide that X. represents offer an when in

quarter, $XX income the of million GAAP while fee XX% based revenue by grew year and our GAAP of adjusted based the of advisory EPS income. XX%, prior earnings fee-related $X.XX on of This versus net translated our EPS period. and grew into $XX non-GAAP million net by management $X.XX For on

targeted over equating the on turn the keeps We now the have to also XXXX. to declared per XX% fiscal a With Mario. per fiscal share track year for us year, I'll over dividend quarter, which share of call this that, $X.XX increase for last $X.XX

Mario Giannini

anniversary. started client, important third with our like to celebrated with I'd a along presence. have by XXX retail clients milestone. our privilege today, institutional and serving the we an we advisory good of more global acknowledging John, morning. growing Thanks, single In June, Having than XXth begin

of all meet class. future. needs our to evolving that XX continuing Our and into past forward on proud innovation over leadership accomplished complex I'm and clients asset increasingly to have of growth us position an the allowed our extremely and years, the look focus has within we we the

now Let X. on some for quarter, beginning me the turn Slide to results

we which advisement. the from separate AUM, asset we sum and footprint, billion under our AUA, of across and consistent the our Total Consistent at of assets to total funds under XX% quarters, prior long-term $XXX year-over-year, quarter a $XX management, client footprint AUM footprint our size highlight was Here, continuing define assets which continues that stood with our asset came growth geographic client as increase growth accounts type, for both and region. diversified be specialized customized trend. billion or to year-over-year, and our XX% represents

we remains focus success. across Our pleased growing with business, continued of are winning both lines simply and and the

year-over-year, our growth which region. As seen for in to was or we've client $XXX what our with AUM, billion similar came and XX% geographic across at from AUA, type

to As on lockstep the relative prior generation. quarter, correlation to And the that direct AUA necessarily saw while a can emphasize variety previous of earnings reasons, fluctuate quarter-to-quarter no dollars revenue not this the mentioned between and with we will increase an but does move associated scale quarter dollars we AUA in continue revenue of AUA with in changes. AUA have those call, for exists

Let Erik. now to me it turn over

Erik Hirsch

Thank morning. you, and Mario, good

X. to on Slide Moving

our highlight AUM. fee-earning we Here,

specialized combination of basis our As management and fees. a separate with fee-earning our reminder, funds our customized point-driven AUM accounts the is

positive XX%, across our $X.X over XX% and separate billion the We accounts. it of fund makes customized funds that will management is business both the continue driver flows fees. AUM this to significant specialized Relative our our to from stemming fee-earning advisory and period, grew up of or total prior emphasize as our year most

from platforms; accounts, two, and one, be in same new components: these X four, separate our net of billion came existing key specialized time our clients; existing our fund and our continue funds. $X.X billion winning period, fee-earning came over Taken segments by clients; raising and from Growth driven $X.X the separately, funds. to X re-ups AUM customized specialized three, adding growing new from

Additionally, our remains combined rate fee steady.

at Moving X. Slide customized months. separate accounts Fee-earning from our to AUM over XX billion, the growing X% stood $XX.X past

type, gross customized last clients. coming see accounts We continue What XX the came separate XX% over from the is months, to the also you geography. more growth that inflows institution across into size here see than existing and of

the segment a say us remains we've heard fee-earning past existing this component achieved the of growth in in AUM. re-ups key of that client base You've from our

expand addition In growing which, and to opportunities. a re-up adding in base future turn, for by winning base client relationships, provide to our re-ups, we continue brand-new

Moving to Growth strong. fund. here our continues be specialized to

We and are set a from diversified well of our executing product around remains the demand coming, globe. the like across suite business, our robust, rest investors of

AUM. $X.X fee-earning resulting billion, Over increase an the months, of we've in inflows XX% in achieved past XX positive

Turning to updates. fund-specific

this held as fund close third for raised known LP close nearly for $XXX over to million direct million. co-investment the equity $XXX formerly During fund, commitments we fiscal our totaled of brings and this quarter, fund, total a our the

this We strong are to pleased the date with globe success demand being the around for shown product. the and

October months this complete expect of XX the and through for to the be we raise in to market product, have from XXXX. We so closing first

July we second closed million closing and direct million of entirety impact surpasses with first first a This the $XXX fund the investment is fund of close our $XXX impact nearly on commitments. July XX commitments. impact XXXX that opportunities. first ESG-oriented LP targeting of of our Next, This nearly we announced of in with fund

seeing And are from Interest we very reporting nature fund, with very quickly been this relatively of was returns returns that date in investors. fund, position we to funds almost IRR the have deal strong by XX. deployed combined and smallest the the our XX% with March from continues space early grow. strong net flow, strong the of market Given of encouraged and it as to a given demand predecessor are

We have this January XXXX to of complete fund raise. until

through million with to Let me acquisition across account our newest take real scaled At account infrastructure additional opportunity Interest separate our infrastructure dedicated specialized dedicated activities years we have with introduce built end RAPM of Hamilton July, long-standing business. date investing. investors begun the launched we've active and alongside a in and has proven separate track and such, nicely fund. both now X Lane resources a through operation some one The The first as had product infrastructure fund. of advisory robust. will and from $XXX flow mandates. on we is our those of investor been direct has increase, our closed already this platform, Lane infrastructure-focused portfolio and The Hamilton Combining in Prior has commitments transactions. continued deal fund focused investing fund our have to long RAPM, to with existing secondaries to equity our space a of ago, the various of along asset grown the record. platform on consist specialized

space to forward March raise, additional to continues the until in have for our in strong. We this providing gears look of products Shifting Demand fund future. updates XXXX Evergreen to be to platform. our now complete and with you the we

in are of of platforms how in $X and for relatively has established size. space, very globe We Evergreen the with have the the as scaled responsible this one very exceed we short ourselves leaders We've billion that encouraged around a in of small amount in quickly a been platform managers time. group

East the spanning geographical Middle XX Americas, and from we continues countries to Our the Asia, reach expand now and Europe, investors have Australia.

partners Additionally, the offered XX being with come we of shortly. to product additional partners distribution healthy is online that pipeline through expect a

a at For launch. investors July, of have the now X in Total exceeded months the $XXX of XXXX in this that flows inflows $X.X Overall, success inflows already results the our for with strategy the our standing This the platform the well and in in XXXX. platform over nearly all is years channel. little the million million. month billion resonating since confirms saw of entirety in $XX approximately initial here of X over continued first of offering AUM

the pleased and forward generated be to thus we've continue expanding to momentum We with even further. look far

strategic to both of highlight provide track Let and investment successful take an our record. will which update approach investments, this me strategic time technology now our on one

heard there put are initiative and turn, CRM industries. consumed approach insights many that that driving managers technology investment James. to add to company systems we should both technology for cloud-based platforms private need and easily institutions, XXXX, more capital financial We to and offer some There we with and market, find before, key our was and strategic and of strong our including sheet DealCloud. invested class comprehensive called business DealCloud In and DealCloud to situations, the became the behind more better strategic our deal-tracking participants solution industry where and leading In this we we in today their the XXXX, Raymond large tailored say we capital information decisions. services key identified a market you've to utilized and are partnering in do, services key software strategically. for outright DealCloud. In others a collaborating and a sense. ability leading us one in as of intricacies create our asset partner be provider company. financial internally services component expertise customer private balance professional teams a the a Intapp, professional the to create KPMG As represented and to of global and those several and is a markets is and makes development and acquired by a well own fund us solution more a a world-class and as all

view our and and a For ultimately key new and our to owner desired our around deal generated remained offering we us, Intapp, customer the of on of and acquisition, benefits the Xx product a the of over partnership. strategic initial investment. the After DealCloud, DealCloud's return be ongoing confirmed continued value

following directly of they result, Hamilton the an DealCloud. a Intapp to opportunity acquisition As invest provided in

present that key there our better will on invested will asset We approximately companies $X time. week's continue opportunities price last or million strongly be our its work is Intapp and $XX.XX, On and with a capital XX, June now million with future make to to $XX back coming class We investment. sheet at believe of more investment become completed $X.X this closing continued -- that balance technology based Now and to Intapp worth share. partners accessible. in IPO had X.Xx

in we identifying Our track success be for companies. to a partner and these record we believe our these demonstrates opportunities, continue sought-after will

now an relates me another provide recently one to strategic move update a tech investments and on as round. it announced of Let our financing

with that of and investment to investors closing on investment the of announced their back this and today. financing on clients, market Sachs of We the million their strategic of chip million, iCapital. Alongside will platform a iCapital Lane XX months. over to pursuit that at along funds their March Xx On providing and democratized education of you we includes me approach, who offering Based specialized with vision aware, the include let balance opportunities to tech-investing access in $XX joined and valuation less of Goldman With our their is invested that, round the $XX a consistent our XXXX, number of seamless now in iCapital BlackRock, of continued formed are private growth private advisers share than a our platform. turn for Blackstone As cover return with group another a into support our that capital investment July iCapital in the Hamilton Atul XX, now original valued sheet in modules of it partnership investors. financials. and many round, of high-net-worth blue to iCapital generating

Atul Varma

Erik, and fiscal the for shows of good the highlights Slide Thank X first everyone. presentation you, financial quarter of morning, XXXX.

solid to period. advisory up with in versus and the management growth business XX% We year prior our see continue fee

million fund Our our equity X% in period. $X.X revenue current period, specialized the latest direct to or the increased driven compared from funds $X year million by prior year

there fund, year quarter period, related As $X.X prior the fees recognized the our prior million the we secondary fund. to first was fees periods. latest from In revenue no retro recognized this in were retro we for the

and for investors occur. that raise As closes closes many to pay fees you the the from dating managed in by spike fund's several of and increased products the offerings revenue existing other that many Capital period, XXXX. from by which retroactive associated the related clients. back re-ups typically our of our XXX compared the $X to the due fund the to first are customized prior with million likely in in management aware, the fund the later accounts Revenue compared close. Therefore, from of pre-existing accounts April driven acquired prior fees funds a separate into come team year to reporting year addition of million our Revenue see increased quarter for to we that you subsequent of new $X.X

$X.X a the our total to saw Incentive to the prior incentive from management in we the of revenue addition, business is quarter. million increase million our revenue In component final fees. in $X.X or year distribution activity strong X% distribution period were The due fees for period of revenue. compared

provide additional carry unrealized detail balance. some Moving our to Slide on X. We

everyone, at the incentive exit. remind the control million. we thus, even we valuations, prior fee don't year, from in $XX.X carry these of now and just that up Unrealized stands Given And XXX% trend the during period. we to continued positions, positive is of million timing don't control the balance $XXX as recognize balance

Turning to XX, profiles our earnings. which Slide

earnings G&A as headquarters, our along and associated revenue year our $X.X fee-related million. prior with earlier, Capital. the rent year total period. expenses result with $X from expenses which XX% growth the with expense XXX compared expenses, the million, $X.X In of up increased compensation a along by we increased margin. to million growth new Total decreased Our versus discussed prior benefits were regard in to included period, our the

on to Slide XX. balance Moving our sheet

on Our our customized accounts our is our and funds. clients specialized largest sheet asset separate in alongside investments balance

And levered you thank happy to growth, it open joining debt we and that, to quarter. modestly even to to regard continue for up our component our liabilities, be term, with our view balance fund Investments our the increase sheet call invest we continue In balance we'll in and important capital Over used for of questions. alongside with investments last the the to the continued an as long clients. Russell we these are

Operator

of first Our Instructions] Stanley. Morgan the line from [Operator is question Michael of Cyprys

Michael Cyprys

Great.

how FRE the Just the guys of here, imagine savings come up the help on to maybe put you back Can of is we want the be -- that much in just I T&E of And the forward back of move from into some COVID-induced that you some the there quarter to margin benefiting cost should T&E run kind at point, quantify that XX%. as line. coming rate. from back us in

you the COVID. could somewhat pieces? just imagine the us be the pre could towards for So of But And comes about partial is the offsets it maybe but moving about that as not what you XX% think I it business. maybe how kind kind down help do kind think you maybe out moving longer-term XX-or-so to back that on you level to had there where And then the XX% forward, and the margin enhance bring today? opportunity margin of of

Erik Hirsch

Sure, Mike. Erik. It's

and there start me Let take that.

you about is of I of noted, in as particularly sort One, of are reduction sort of the factors. around driven I driven the really And think COVID would margin think impact, you right. by T&E. growth being X the some sort certainly

sort seeing say out indications we're significant sort of this year, remainder big just rapid conferences, return are of would a look international for or to we events of As not travel. the I

several continue to continues eye next to keep here that. as look we'll the on for we So muted today, all that months. But an sit

the in business. the I the margin around of really think mix driver the is second

certainly our you higher As in specialized more the a continues kind grow, to well our platform that business. fee, I know, higher that fund leverageable margin, include and of would business, as aspect is to Evergreen

But to think I ratio The hard a margin both of in combo that, of really increase those by -- think, occurring. both the exact is the of is I think I those it's there's to XX% of XX% from so quantify. components. driven And

around back, Evergreen, forward driver we margin. can, a the terms As experiencing or obviously, could specialized keep it to sort been I up, of what look is in of that think growth of what of, going positive up on it funds, going keep of kind continued we've it kind all as pull

think sort backwards seeing of really sort sort a the of moving X reduction, of that pieces. On be or would I

return-to-normal a on pressure. seeing we're about in something talk a earnings that keeping be I of would it people is kind you've heard other which that even one, or second certainly of think And beyond-normal eye calls, perhaps is level prior think, piece the T&E. I an wage

real so across hiring competition talent seeing for we're And our lot a different of areas.

those If our growing be be you website of and see were because think continue we so job look on negative today, I would openings impacts. to to you potential a number could strongly,

Michael Cyprys

Great. And the just maybe question on a strategy. Evergreen follow-up

now. the you $X.X on in there you in as mentioned you're that months over or How you Can capital to of bit out and U.S.? the are next see many you you the sales update channel? guys of strategy. some retail here on the a resources think drive so? distribution taking the I you us that Hoping of now putting do could talk up How some you billion about against from guys growth evolving look platforms actions the are

Erik Hirsch

It's stick Sure, Erik. I'll Mike. that. with

I think about it got distribution the attacking partners globally. as we're now, of sort in the thinking holistically, We're platform said we've script, holistically. and we right XX about

of portfolios across we as lot different a investment sleeve, very we and subentities in and have had have in U.S. the we the vehicles. areas. domiciled the investment a past, are we to orientation, in very, our vehicles X sort of as similar from said while So have There's do non-U.S. different I the reasons, sleeve just firm's even think structural the different a specific strategies

it's here some had -- distribution partners. good getting in So success think I really here, we've

coming. others strong with we as today of So said, XX a pipeline

our out sales internal build to continue We force.

to at the you XXX acquisition some has our number further a on force, Lane hires additional had ago, of are resources years on opportunity. So that. added of And we've beyond that, retail that targeted look them the the to if added X obviously, the sales specifically Hamilton

looked as approach. X-prong a at So I of sort we've think always this

to partners, to resources, having then having to that success product. really and leverage You've that. product resources have off distribution get them in we great good help by those know internal support their got of them internal add the continue And getting having and then we do, you into channels, finding move

billion very the over you distribution when fact of the country sort that at a countries, is sort very, So partners, XX view $X count, the the that we look of XX meaningful place place getting couple sitting are competitors of range. all hundred a of are people to lot still today, be. kind the It's of not a in dollar where million of that

getting of up think requires scale, you attention well the strong $XX those there. you think of that at sort proving of kind saw being $X.X bodes operate billion think put And being flows the of I can at is future. that the We that million. all us you to July today, for and market we very

Operator

of line the from Ken is Worthington JPMorgan. of question Next

Ken Worthington

So hear the carry I more was accrued hoping pace of realization. comments about of to your

you So grow European carry I underlying funds, historical does structured investments, of more in think, control products. there's number mix, aggregate you don't your mentioned to smartly. products the continue really, of American-carried structured accrued the but the then And prepared remarks, really the that complementing more sort carried

towards thoughts funds you be European outlook about environment, mix, given So that funds the any great more the migrating for the more share entering American-style can later generation? carry life, may

Erik Hirsch

in Erik. Ken. It's I'll Sure, there. dive

we put sort that can at piece we the piece the it look we can't as carry and think of we control. that story, I the into control

indicative value, to piece a control that's the look And when unrealized way. the is I very in we can that actually good putting the you rise money doing of think work the I think we're smart at I in think investments.

carry aligned benefiting benefiting with much very us the are are from and clients that side. of on then them also Our sort

carry not just that It's different very those it's XX the it's So think, number only of I vehicles to now we're very, vehicles growing strong. nicely. magnitude component. of see continuing that the today over carry that have dollars, piece, a And also

in spot of I chart kind of sort if is, went as the I the chart, history, in following you back little have flagship our would there which think second It been a you waterfall, carry part you if is on, that almost big funds, European have pie think very model. secondary, chart. co-investment pie think mindset been exclusively firm's your that et of about if of all will, kind that our cetera, would that vehicles, European pie been would waterfall diversification have

will really other and If out components business X the the accounts a over dollars in of just model, sort the place given is One on number growth them more deal-by-deal transactional of generate this separate that have to are nature of separate carry time, that deal-by-deal to carry-generating environment. is a by the growing the Evergreen. sort you up the look think, are And meaningful where and structure picking those continue it's account. we the the we in we structure other retail -- a in of second That areas of places. dollars, is

old. Now years, only we've at the and we've you that for been years best there for an today's first is private what about asset kind In also market, running the a so we've when X in years. of X you're business X.X look are to X that environment exit average said deals and in at done that

to continues a carry I be But to coming and growing think in totality think to pie will So more dollars is style we're that what of and focused continues where be of story I mix the American see that think our over very proportion those change I that strong. deal-by-deal going you time, on, waterfall. of

Ken Worthington

market deals Great. level activity about the in like putting just things nature one, are that do work. What pace on of that we secondaries? secondaries? levels talk fund sort just of come to with the funds? seeing then just have competitive money market Okay. industry in today? is And secondary in you're that And You market, And secondary what of the assets commensurate raised for into of maybe the look

Mario Giannini

we've mentioned interesting Ken, on as prior it's It's Mario. an market, calls.

market, I today. Where It that's of X that would composed demand, LP Pricing in think, transaction. entire sort that capital the has And interest single-asset markets, secondary in to can with the the in the deals, around of the the the which downs. market deals the volume of say pieces. pretty of reasonable its capital number been GP-led is grow. of now, raised a I certainly at to transaction ups secondary look supply continuation market deals, market I that that's market it at pace. has the it GP-led is think but again really, There's space, one all continues is X/X amount particularly it's expanded the robust that even something And is the is market, continues is deals. than market you can and where of traditional in grow of And like the that really dwarfs, funds, say, higher exceeds of interestingly, there. far you

of today's market, deals. where in your supply-demand have the choice you is capital, enough, have where imbalance one oddly that you if So places of you a and see

work there my really are I've "Oh to enough scrambling deals. because money say, to not got You aren't gosh, put to

So some for And that period it's to very to really sell, many assets. retain I interest they particularly suspect because an for that it's very partners of time, effectively for in area attractive cases, channel market partners limited the and companies will like. in attractive a invest continue

time. will continue So some I for that think

Operator

line the Sachs. Alex from is question Next Blostein of Goldman of

Alex Blostein

A on dynamics. the fee couple revenue

talked you was quarters. impact next over of first, the fees, guess, funds in to on I specialized about hoping and the couple the touch earlier So I on management that momentum the

this the they're of ideas the co-invest as the of guess, of I Any of II fund, be the the I more much, time How sort on bit over should for of impact these in to little is highlighted, how bonds already you expect, infra fundraising Erik, quarter? we as for that So capacity and rate run in quarters? sort mode a the coming fund much guess, going still?

Erik Hirsch

it's Erik. Alex, that. I'll Sure, take

a it's mix. So

a targets some that where some the raise baked closing occurred occurred of some have, are closing, is of So fund we some of that's staggered some we From because of just do things where announced those these so the purposely. sort given we've that a the across and been in capacity things versus of have of there. quarter, publicly the those not as We standpoint, time on vehicles any noted. haven't long having

that of our flow, about if are very, sitting think think as over And time, add that these our can think we growth. very mix, today, to when is we so scalable. of grow, large that investment excited view as infrastructure, opportunity sets of front about those And which you kind deal very to the impact, the we you about we're to firm in if see platforms meaningful us sort contributors we into see

to So I think gate the close the million, kind we about I sit well here that all $XXX close the for just of out fact coming already bodes of first that's today excited think infra, future. with that sort of

contribution to where future. sitting the I sit see those today. That in is going you're not vehicles to occurring we the think so or And

Alex Blostein

account then accounts, Is here the is X sort used range it. maybe management growth work that's of re-upping just of same revenue of, another maturing? kind through guys of you the for that's I do If people Got management of separate case, separate in re-ups. lack growth from the things, the comments amount a your guess, the the function closer rate And of about private sort around fee this basis. expanding thinking side the for so LP network growth back what more a fees. growth one over been year-over-year on bit a of has slower also of is quarters XX% last heard about on I here the single-digit kind here a muted customized coming kind low maybe to markets? to of come can double-digit that growth how

Erik Hirsch

I'll Sure. stick Alex, with it's that. Erik.

of I think couple I pieces. think it's a

it's pandemic. more different kickoff. in be to different in-person the account cetera. A when I about environment where, separate in past, think of one, people, base, diligence, think, size visits, that this to a think site a lot relationship office There installed do harder we've again, in it's a a our spent, tends said I you the little time due et diligence visits,

from and And getting of so impressive we new the installed the coming fact think that growth is base, XX% strong. still we're a

would relationship I we've just that their find secondaries bit increasingly, or beginning highlight finding is are J-curve little credit. the we're more piece fund, with of separate when number other got The our particularly first specialized themselves account that going clients a oriented, things a a like into mitigation dollars might that invested

but is So of a thing when first flows. also I separate flows the account account where fund actually But not seeing you simply flows you're think it's business, you coming come separate new this and is of actually of the involve some get dollars into to timing done the sort the the are after components, some won traditional separate funds. already they strategic earlier later they have tend of specialized have which account just will specialized

Alex Blostein

about helpful guys. just Got squeeze the a really I If message, just it. about could context. is guess to on mid- thinking this Evergreens Hamilton and to in specialized funds high-XXs? is for to I the guess, I some one these the need margin of start sort the and more, on question. ultimately Lane in more the FRE to scale, back the low-XXs? to should initiatives about just understand trying I'm Mike's follow-up in really you you should That's be talked but we FRE for think margins to business, that what invest in past, migrating of Or we normalized

Erik Hirsch

think it's be look -- Erik, I it's -- Alex, mean, can I things I again. both Yes, true. think

set the can firm's morning we mindset, don't clearly We penny we another extract the in element thinking we'll said up we again, how an this about I way. wake say that from mean, where That how base, there's we strong we where growth a morning as market-leading can a wake and up think sustainable, of is. for and scalable, a team client the margin. can diversified diversified how thinking across mindset it in I about across continue in sustain geographies double-digit to our management is do

that nature to of that there through. you the see Now that the obviously do and things operating of leverage, coming is business themselves lend some are

of market-leading position. of Whatever I we've -- to what sort I investments got think sort going that. business the XX-year will what what the continue and -- we're the same look need we is, have a history we that's require, of and to think sustain required doing are to does continue to at

that the said that are clearly of sort again, don't out, years? not wage jump whether but that sort have of I next created, several forces to of continue you We playing to how all the happens to sort going is pandemic we're -- So or travel of as XX% that's there the see think know. going return kind of to a market is I are XX%, Do rapidly here believe not? think We from that to plays do don't before, lot for we know. pressure

some to from going balancing up and operating are the continue pick question of that, you we're benefiting the be there's those I will into leverage have think And specialized funds, that we you I as good benefit today. pieces. But future. a to continue some of scale no that that result suspect as to

Operator

of Next question Margo from is the of line KBW. Rybeck

Margo Rybeck

a know know mentioned that kind some forward? talk could we about wage was it compensation Rob. down I going you for This I was for you in filling is Could hoping about about I quarter. industry, Margo the had should compensation. pressure you And but think how also, was? bit talk why of the little in

Erik Hirsch

It's Margo. jump in I'm to Sure, on that. happy Erik.

draw that of really the last sort sort non-normalized what attention I compensation was I X for compensation, year's think I think factors. to on would of people's is

retro that and accrue we of recall bonus recurring. not revenue accrued was year, of was, fees The last it a pool should. sort But that, is in that, are the still was margin performing off bigger bonus of One of that as pandemic-oriented. in still well of was but again, kind that just upswing those lot business it of had the part second we

compensation base should so And of the year's of this were expanding people the have on not last been sort which year. base

that sort compensation sort You normalize to got of pull make recurring of the fees on retro kind of a basis. it revenue to out and

sort $XX when of So in that million range. that more like a I do puts compensation that, you think you is that number

It I again, because the so coming gone a partly the basis. onetime looks more think is of compensation compensation like had it up And factors why is, of you're down. those seeing around combo but

software market, managers, of specialists just support. would high to are departmental that fee you certain oriented are today's there tell operational around pressure, to people certain hiring if that development or are you skill I in right those managers, things of IT talk grow the they their whether or I if whether experts, now talk designed that think areas, kind our back-office on they you scale are sets think or and in demand, and are valuation kind continuing needing to businesses

openings. be just is position posted of at and them job compensation of need and website ourselves sure kind number of market in attractive. to of we're all we a got And that you go mindful we've see making Again, look out where be and reflective coming putting so to a the I think can there. sort And

if result Now great most providing has to our it's our at experience. of history, and think paying I about attract the not been retain money, look ability the we you work talent a have simply

winner things being to that, ability think places well of in I those compete our a well like all things and long-time of best work think to for bode I talent.

so heard you've eye others, keeping hearing is it but of from all kind occurring that think we're I an out something is And and now it. on us, from you're there --

Margo Rybeck

to update give helpful. very fees? Would you then that's an powder more. committed That's just Great. dry one earning on And not able

Erik Hirsch

Yes, Erik, Margo. It's sure.

So have that's we not that number posted. a

all way I think past It's all that we're a the what the of It's business. something said the lot of the we have It's we in have. we it. is, nature have structured.

of not opted know, It's of on sort is replacing sort as that. advertising expiring. there. a have dollars are that we It's to substantial. take you that, lot think tact of I A different

we've revenue that, simply tomorrow might I not be end, driving the and definition, in all hand our dollars are always we future. coming preferred by opposed And from growth. what be as of in to so shareholders new about that that talk today can think to are from And benefiting

Operator

Beatty from is Adam question the line of Next UBS. of

Adam Beatty

launching what the the either you've and that given introduce capitalize wondering, seeing of new is seen otherwise? have a it areas just sort your a you the volume venue, question was sort given just account pent-up of things, of I of accounts around out fund might it in experience that evolution the maybe infrastructure where might it. separate or upon fund, the first My kind draws pretty brisk frame time other could -- specialized you what separate on similar other be demand product

Erik Hirsch

Sure. It's Erik. take that. I'll

in I at mean specialized accounts think fund. if history, our prior done to we've look a launching a area always particular you separate

experience kind initially your from it's base. current in found demand your of one, of been, sort installed comes -- our that We have it's from the

me market secondary us that in the the a to you to it's develop comes to it you, for impact has now infrastructure that who be?" now to you lead investor So space. then leads who flow, launch then space, co-investment That's demand, deal separate can ability, to "Hey, reputation. whatever tends from secondaries for via for record says, relationship And do the who and that credit cetera, with And fund. in track co-investments or may the inevitably, so a which already what's go thing space, that customer account, start us kind space, or higher start trust develop desire, specialized to of happened you to space the you already develop to ask an happening a the what you I start et

we I we of or need are out There our areas specialized want specialized And look lots that of of business. today, a all Asia said cases, an a time. might view are of So big meaningful got in we've what you really in sort don't sort areas yet. you across think product. always we're change don't could as more That player we've with going on have if and doesn't In over some relatively see I it But of small hands ourselves fund. fund look and We a products the the that successful it geographic-specialized you offer geography. at player some full offer in see cases, market today we than think could specialization fundraises the which already. demand, you sort i.e.,

We capital the equity offer specialized or venture area. also products don't in growth

think in lot a And with track we future. out think think goal Evergreen very sort infrastructure, the I in last got of we'll firm I years investment, the justify creating X still to innovating. now you X.X and of of impact. sort being And go back is is, verticals I brand and think new we've X being of fund a our universe. with vertical, despite it the And there focused shows on So in see the to specialized background record the those continue I ago, that created into pandemic, if even across sort innovate whitespace the We've you spaces. bandwidth, years,

Adam Beatty

toward I true. the mix that. And domestic you've as And given bringing that's my appreciate be would out Fund, the several more on internationally is XXX, countries. pipeline mean, Evergreen at this on just not kind you a kind in comment but mindset briefly Could terms on tilted like it that then the in pretty the of follow-up of I the maybe of well. of that? impressive point, Interesting. the just it got distribution number sounds of in build of platforms

would can of say distributors types you anything about appreciated? geography So the be and the

Erik Hirsch

significant stick a the I had Erik, remember, It's international time that. with mean, again, start. Sure. and product I'll head

today have inside U.S. So outside we U.S. assets the we than more the do

a I environment. start think quickly of regulatory through result we're than largely the we of to terms year how get head had in more able the

From we so the And are where relatively would of geographically are I that's evenly sales resources perspective, sort today. split. a say

existing sort different Hamilton to the inside Distribution the XXX are this the the not the resources, which We outside number we retail. And some kind have across a are of of sort partners addition a that geographies. crew again those have exclusively of focused people inside this of number selling U.S. U.S., of focused on the is Lane in on least of people selling of U.S.

sit as distribution so the across our along we of geographic into goal, that to here is sort continue march and distant we partners. as today, globe move And continue just

of They over to of is those want you that the we points why where be mark engage some there of one levels flows. handle wanted until can not and of like to the the $X emphasize with think of I tend organizations. do you're think around sort you larger kinds simply who feel partners that then distribution they at kind kind their size being are vehicle to the billion of we

want And and want prove can to that the track they dollars see see you to in fact scale do so record. can scale, record that they some successfully, you see with longevity and and that more viability they the to want track

sort that X-plus the we're billion making is now attractive to mark. that running those all of boding think So year at mark. over kind very for We of platforms. now of We're $X well us

Adam Beatty

Is terms your milestone in the in important track record? X-year, the of an Excellent. experience,

Erik Hirsch

of is any that's and magical don't think nothing of rules. hardset kind I there's this

go you of vehicle sort your that of how organization-to-organization, as around monthly think or has of what operation how long how your in or terms each either of some gauges old your them I important from sort organization are. has view in or big flows they different been as it is is

of we those is point that we're today. of just kind all that, And that the that our any serve I So and well. good future think us think should looking for across metrics continues

Operator

for remarks. Hirsch the now you, back participants. to turn final over I'll call Thank Erik

Erik Hirsch

Great.

appreciate know busy. everyone is a is particularly time. always, we We busy this week. the know We As

the support, time and appreciate we wish day. and we a good the everyone So

Operator

that conference. for joining. And concludes today's Thank all you

You may now disconnect.

Hamilton Lane (HLNE) 7 Aug 212022 Q1 Earnings call transcript