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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

May 23, 2024
Date of Report (date of earliest event reported)

STEPSTONE GROUP INC.
(Exact name of registrant as specified in its charter)
Delaware
001-39510
84-3868757
(State or other jurisdiction of incorporation or organization)
(Commission File Number)
(I.R.S. Employer Identification No.)
277 Park Avenue, 45th Floor
New York,
NY
10172
(Address of Principal Executive Offices)
(Zip Code)
(212) 351-6100
Registrant's telephone number, including area code

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Class A common stock, par value $0.001 per shareSTEPThe Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02. Results of Operations and Financial Condition.
On May 23, 2024, StepStone Group Inc. (the “Company”) issued a press release announcing its financial results for the fourth quarter and full fiscal year ended March 31, 2024. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 2.02 as if fully set forth herein.
The information included in, or furnished with, this report shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit No.Description
Press Release of StepStone Group Inc. dated May 23, 2024
104Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

STEPSTONE GROUP INC.
Date: May 23, 2024By:/s/ David Y. Park
David Y. Park
Chief Financial Officer
(Principal Financial Officer and Authorized Signatory)

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STEPSTONE GROUP REPORTS FOURTH QUARTER AND FISCAL YEAR 2024 RESULTS
NEW YORK, May 23, 2024 – StepStone Group Inc. (Nasdaq: STEP), a global private markets investment firm focused on providing customized investment solutions and advisory and data services, today reported results for the quarter ended March 31, 2024. This represents results for the fourth quarter and fiscal year ended March 31, 2024. The Board of Directors of the Company has declared a quarterly cash dividend of $0.21 per share of Class A common stock, and a supplemental dividend of $0.15 per share of Class A common stock, both payable on June 28, 2024, to the holders of record as of the close of business on June 14, 2024.
StepStone issued a full detailed presentation of its fourth quarter and full fiscal year ended March 31, 2024 results, which can be accessed by visiting the Company’s website at https://shareholders.stepstonegroup.com.
Webcast and Earnings Conference Call
Management will host a webcast and conference call on Thursday, May 23, 2024 at 5:00 pm ET to discuss the Company’s results for the fourth quarter and fiscal year ended March 31, 2024. The webcast will be made available on the Shareholders section of the Company's website at https://shareholders.stepstonegroup.com. To listen to a live broadcast, go to the site at least 15 minutes prior to the scheduled start time to register. A replay will also be available on the Shareholders section of the Company's website approximately two hours after the conclusion of the event.
To join as a live participant in the question and answer portion of the call, participants must register at https://register.vevent.com/register/BId5cd8066fd0940f4a3b8e418ecac260c. Upon registering you will receive the dial-in number and a PIN to join the call as well as an email confirmation with the details.
About StepStone
StepStone Group Inc. (Nasdaq: STEP) is a global private markets investment firm focused on providing customized investment solutions and advisory, data and administrative services to its clients. As of March 31, 2024, StepStone was responsible for approximately $678 billion of total capital, including $157 billion of assets under management. StepStone's clients include some of the world's largest public and private defined benefit and defined contribution pension funds, sovereign wealth funds and insurance companies, as well as prominent endowments, foundations, family offices and private wealth clients, which include high-net-worth and mass affluent individuals. StepStone partners with its clients to develop and build private markets portfolios designed to meet their specific objectives across the private equity, infrastructure, private debt and real estate asset classes.
Forward-Looking Statements
Some of the statements in this release may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are forward-looking. Words such as “anticipate,” “believe,” “continue,” “estimate,” “expect,” “future,” “intend,” “may,” “plan” and “will” and similar expressions identify forward-looking statements. Forward-looking statements reflect management’s current plans, estimates and expectations and are inherently uncertain. The inclusion of any forward-looking information in this release should not be regarded as a representation that the future plans, estimates or expectations contemplated will be achieved. Forward-looking statements are subject to various risks, uncertainties and assumptions. Important factors that could cause actual results to differ materially from those in forward-looking statements include, but are
1

not limited to, global and domestic market and business conditions, our successful execution of business and growth strategies, the favorability of the private markets fundraising environment, successful integration of acquired businesses and regulatory factors relevant to our business, as well as assumptions relating to our operations, financial results, financial condition, business prospects, growth strategy and liquidity and the risks and uncertainties described in greater detail under the “Risk Factors” section of our annual report on Form 10-K filed with the U.S. Securities and Exchange Commission on May 26, 2023, and in our annual report on Form 10-K to be filed with the SEC for the fiscal year ended March 31, 2024, as such factors may be updated from time to time. We undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by law.
Non-GAAP Financial Measures
To supplement our consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States (“GAAP”), we use the following non-GAAP financial measures: adjusted management and advisory fees, net, adjusted revenues, adjusted net income (on both a pre-tax and after-tax basis), adjusted net income per share, adjusted weighted-average shares, fee-related earnings, fee-related earnings margin, gross realized performance fees and net realized performance fees. We have provided this non-GAAP financial information, which is not calculated or presented in accordance with GAAP, as information supplemental and in addition to the financial measures presented in this earnings release that are calculated and presented in accordance with GAAP. Such non-GAAP financial measures should not be considered superior to, as a substitute for or alternative to, and should be considered in conjunction with, the GAAP financial measures presented in this earnings release. The presentation of these measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. In addition, the non-GAAP financial measures in this earnings release may not be comparable to similarly titled measures used by other companies in our industry or across different industries. For definitions of these non-GAAP measures and reconciliations to applicable GAAP measures, please see the section titled “Non-GAAP Financial Measures: Definitions and Reconciliations.”
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Financial Highlights and Key Business Drivers/Operating Metrics

Three Months EndedYear Ended March 31,Percentage Change
(in thousands, except share and per share amounts and where noted)March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024vs. FQ4'23vs. FY'23
Financial Highlights
GAAP Results
Management and advisory fees, net$132,573 $138,115 $142,123 $151,492 $153,410 $497,179 $585,140 16 %18 %
Total revenues172,374 178,011 191,422 (14,612)356,810 (67,574)711,631 107 %na
Total performance fees39,801 39,896 49,299 (166,104)203,400 (564,753)126,491 411 %na
Net income (loss)56,816 49,446 59,251 (23,419)82,542 (45,275)167,820 45 %na
Net income (loss) per share of Class A common stock:
Basic$0.46 $0.34 $0.42 $(0.32)$0.48 $(0.30)$0.91 4 %na
Diluted$0.46 $0.34 $0.42 $(0.32)$0.48 $(0.30)$0.91 4 %na
Weighted-average shares of Class A common stock:
Basic62,805,788 62,834,818 62,858,468 64,068,952 64,194,859 61,884,671 63,489,135 2 %3 %
Diluted65,831,409 65,739,470 66,198,129 64,068,952 67,281,567 61,884,671 66,544,038 2 %8 %
Quarterly dividend per share of Class A common stock(1)
$0.20 $0.20 $0.21 $0.21 $0.21 $0.80 $0.83 5 %4 %
Supplemental dividend per share of Class A common stock(2)
$— $0.25 $— $— $— $— $0.25 nana
Accrued carried interest allocations$1,227,173 $1,277,783 $1,331,778 $1,203,847 $1,354,051 10 %
Non-GAAP Results(3)
Adjusted management and advisory fees, net(4)
$132,720 $138,301 $142,327 $151,943 $153,808 $497,326 $586,379 16 %18 %
Adjusted revenues152,940 152,780 149,800 185,123 177,357 641,970 665,060 16 %4 %
Fee-related earnings (“FRE”)37,796 44,402 43,827 50,664 50,900 156,158 189,793 35 %22 %
FRE margin(5)
28 %32 %31 %33 %33 %31 %32 %
Gross realized performance fees20,220 14,479 7,473 33,180 23,549 144,644 78,681 16 %(46)%
Adjusted net income (“ANI”)27,115 29,388 30,173 42,116 37,716 142,663 139,393 39 %(2)%
Adjusted weighted-average shares
114,765,635 114,673,696 115,118,060 115,232,927 115,512,301 114,618,105 115,134,473 
ANI per share$0.24 $0.26 $0.26 $0.37 $0.33 $1.24 $1.21 38 %(2)%
Key Business Drivers/Operating Metrics (in billions)
Assets under management (“AUM”)(6)
$138.4 $142.6 $145.8 $149.0 $156.6 13 %
Assets under advisement (“AUA”)(6)
482.2 497.0 512.9 510.5 521.1 8 %
Fee-earning AUM (“FEAUM”)85.4 87.4 87.3 89.4 93.9 10 %
Undeployed fee-earning capital (“UFEC”)
15.7 16.9 18.1 21.4 22.6 44 %
_______________________________
(1)Dividends paid, as reported in this table, relate to the preceding quarterly period in which they were earned.
(2)The supplemental cash dividend relates to earnings in respect of our full fiscal year 2023.
(3)Adjusted management and advisory fees, net, adjusted revenues, FRE, FRE margin, gross realized performance fees, ANI, adjusted weighted-average shares and ANI per share are non-GAAP measures. See the definitions of these measures and reconciliations to the respective, most comparable GAAP measures under “Non-GAAP Financial Measures: Definitions and Reconciliations.”
(4)Excludes the impact of consolidating the Consolidated Funds. See reconciliation of GAAP measures to adjusted measures that follows.
(5)FRE margin is calculated by dividing FRE by adjusted management and advisory fees, net.
(6)AUM/AUA reflects final data for the prior period, adjusted for net new client account activity through the period presented. Does not include post-period investment valuation or cash activity. Net asset value (“NAV”) data for underlying investments is as of the prior period, as reported by underlying managers up to the business day occurring on or after 100 days, or 115 days at the fiscal year-end, following the prior period end. When NAV data is not available by the business day occurring on or after 100 days, or 115 days at the fiscal year-end, following the prior period end, such NAVs are adjusted for cash activity following the last available reported NAV.
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StepStone Group Inc.
GAAP Consolidated Balance Sheets
(in thousands, except share and per share amounts)
As of March 31,
20242023
Assets
Cash and cash equivalents$143,430 $102,565 
Restricted cash718 955 
Fees and accounts receivable56,769 44,450 
Due from affiliates67,531 54,322 
Investments:
Investments in funds135,043 115,187 
Accrued carried interest allocations1,354,051 1,227,173 
Legacy Greenspring investments in funds and accrued carried interest allocations(1)
631,197 770,652 
Deferred income tax assets184,512 44,358 
Lease right-of-use assets, net97,763 101,130 
Other assets and receivables60,611 44,060 
Intangibles, net304,873 354,645 
Goodwill580,542 580,542 
Assets of Consolidated Funds:
Cash and cash equivalents38,164 25,997 
Investments, at fair value131,858 30,595 
Other assets1,745 772 
Total assets
$3,788,807 $3,497,403 
Liabilities and stockholders’ equity
Accounts payable, accrued expenses and other liabilities$127,417 $89,396 
Accrued compensation and benefits101,481 66,614 
Accrued carried interest-related compensation719,497 644,517 
Legacy Greenspring accrued carried interest-related compensation(1)
484,154 617,994 
Due to affiliates212,918 205,424 
Lease liabilities119,739 121,224 
Debt obligations148,822 98,351 
Liabilities of Consolidated Funds:
Other liabilities1,645 566 
Total liabilities1,915,673 1,844,086 
Redeemable non-controlling interests in Consolidated Funds102,623 24,530 
Redeemable non-controlling interests in subsidiaries115,920 — 
Stockholders’ equity:
Class A common stock, $0.001 par value, 650,000,000 authorized; 65,614,902 and 62,834,791 issued and outstanding as of March 31, 2024 and 2023, respectively
66 63 
Class B common stock, $0.001 par value, 125,000,000 authorized; 45,030,959 and 46,420,141 issued and outstanding as of March 31, 2024 and 2023, respectively
45 46 
Additional paid-in capital310,293 610,567 
Retained earnings13,768 160,430 
Accumulated other comprehensive income304 461 
Total StepStone Group Inc. stockholders’ equity324,476 771,567 
Non-controlling interests in subsidiaries974,559 36,380 
Non-controlling interests in legacy Greenspring entities(1)
147,042 152,658 
Non-controlling interests in the Partnership208,514 668,182 
Total stockholders’ equity1,654,591 1,628,787 
Total liabilities and stockholders’ equity$3,788,807 $3,497,403 
(1)Reflects amounts attributable to consolidated VIEs for which the Company did not acquire any direct economic interests.
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StepStone Group Inc.
GAAP Consolidated Statements of Income (Loss)
(in thousands, except share and per share amounts)
Three Months Ended March 31,Year Ended March 31,
2024202320242023
Revenues
Management and advisory fees, net$153,410 $132,573 $585,140 $497,179 
Performance fees:
Incentive fees2,496 1,318 25,339 9,663 
Carried interest allocations:
Realized18,054 18,693 49,401 131,089 
Unrealized151,757 100,753 126,908 (253,342)
Total carried interest allocations169,811 119,446 176,309 (122,253)
Legacy Greenspring carried interest allocations(1)
31,093 (80,963)(75,157)(452,163)
Total performance fees203,400 39,801 126,491 (564,753)
Total revenues356,810 172,374 711,631 (67,574)
Expenses
Compensation and benefits:
Cash-based compensation74,411 69,990 292,962 252,180 
Equity-based compensation13,937 9,335 42,357 24,940 
Performance fee-related compensation:
Realized11,421 12,755 37,687 79,846 
Unrealized84,014 53,515 74,694 (119,039)
Total performance fee-related compensation95,435 66,270 112,381 (39,193)
Legacy Greenspring performance fee-related compensation(1)
31,093 (80,963)(75,157)(452,163)
Total compensation and benefits214,876 64,632 372,543 (214,236)
General, administrative and other54,310 35,612 167,317 147,159 
Total expenses269,186 100,244 539,860 (67,077)
Other income (expense)
Investment income (loss)3,337 2,964 7,452 (2,509)
Legacy Greenspring investment loss(1)
(33)(11,148)(9,087)(44,075)
Investment income of Consolidated Funds6,115 4,420 28,472 9,315 
Interest income1,429 853 3,664 1,921 
Interest expense(2,649)(1,674)(9,331)(4,189)
Other income (loss)(1,308)(40)2,455 (1,420)
Total other income (expense)6,891 (4,625)23,625 (40,957)
Income (loss) before income tax94,515 67,505 195,396 (41,454)
Income tax expense11,973 10,689 27,576 3,821 
Net income (loss)82,542 56,816 167,820 (45,275)
Less: Net income attributable to non-controlling interests in subsidiaries4,443 9,358 37,240 35,194 
Less: Net loss attributable to non-controlling interests in legacy Greenspring entities(1)
(33)(11,148)(9,087)(44,075)
Less: Net income (loss) attributable to non-controlling interests in the Partnership37,279 28,420 59,956 (19,772)
Less: Net income attributable to redeemable non-controlling interests in Consolidated Funds4,248 1,385 15,838 1,776 
Less: Net income attributable to redeemable non-controlling interests in subsidiaries5,782 — 5,782 — 
Net income (loss) attributable to StepStone Group Inc.$30,823 $28,801 $58,091 $(18,398)
Net income (loss) per share of Class A common stock:
Basic$0.48 $0.46 $0.91 $(0.30)
Diluted$0.48 $0.46 $0.91 $(0.30)
Weighted-average shares of Class A common stock:
Basic64,194,859 62,805,788 63,489,135 61,884,671 
Diluted67,281,567 65,831,409 66,544,038 61,884,671 
(1)Reflects amounts attributable to consolidated VIEs for which the Company did not acquire any direct economic interests.
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Non-GAAP Financial Measures: Definitions and Reconciliations
Adjusted Management and Advisory Fees, Net
The following table presents the components of adjusted management and advisory fees, net. We believe adjusted management and advisory fees, net is useful to investors because it removes the impact of consolidating the Consolidated Funds which we are required to consolidate under GAAP.
Three Months EndedYear Ended March 31,
(in thousands)March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024
Focused commingled funds(1)(2)
$62,093 $67,119 $70,481 $78,633 $80,434 $227,068 $296,667 
Separately managed accounts54,033 55,744 56,431 55,838 55,945 210,187 223,958 
Advisory and other services15,546 14,101 13,740 16,069 16,147 56,244 60,057 
Fund reimbursement revenues(1)
1,048 1,337 1,675 1,403 1,282 3,827 5,697 
Adjusted management and advisory fees, net
$132,720 $138,301 $142,327 $151,943 $153,808 $497,326 $586,379 
_______________________________
(1)Reflects the add-back of management and advisory fee revenues for the Consolidated Funds, which have been eliminated in consolidation.
(2)Includes income-based incentive fees of $0.8 million for the three months ended March 31, 2024, $0.6 million for the three months ended December 31, 2023, and $1.4 million in fiscal 2024 from certain funds that are regulated as a business development company.
Adjusted Revenues
Adjusted revenues represents the components of revenues used in the determination of ANI and comprise adjusted management and advisory fees, net, adjusted incentive fees (including the deferred portion) and realized carried interest allocations. We believe adjusted revenues is useful to investors because it presents a measure of realized revenues.
The table below shows a reconciliation of revenues to adjusted revenues.
Three Months EndedYear Ended March 31,
(in thousands)March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024
Total revenues$172,374 $178,011 $191,422 $(14,612)$356,810 $(67,574)$711,631 
Unrealized carried interest allocations(100,753)(49,364)(55,371)129,584 (151,757)253,342 (126,908)
Deferred incentive fees209 — 942 — 1,450 3,892 2,392 
Legacy Greenspring carried interest allocations
80,963 23,947 12,603 69,700 (31,093)452,163 75,157 
Management and advisory fee revenues for the Consolidated Funds(1)
147 186 204 451 398 147 1,239 
Incentive fees for the Consolidated Funds(2)
— — — — 1,549 — 1,549 
Adjusted revenues$152,940 $152,780 $149,800 $185,123 $177,357 $641,970 $665,060 
_______________________________
(1)Reflects the add-back of management and advisory fee revenues for the Consolidated Funds, which have been eliminated in consolidation.
(2)Reflects the add back of incentive fees for the Consolidated Funds, which have been eliminated in consolidation.
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Adjusted Net Income
Adjusted net income, or “ANI,” is a non-GAAP performance measure that we present before the consolidation of StepStone Funds on a pre-tax and after-tax basis used to evaluate profitability. ANI represents the after-tax net realized income attributable to us. ANI does not reflect legacy Greenspring carried interest allocation revenues, legacy Greenspring carried interest-related compensation and legacy Greenspring investment income (loss) as none of the economics are attributable to us. The components of revenues used in the determination of ANI (“adjusted revenues”) comprise adjusted management and advisory fees, net, adjusted incentive fees (including the deferred portion) and realized carried interest allocations. In addition, ANI excludes: (a) unrealized carried interest allocation revenues and related compensation, (b) unrealized investment income (loss), (c) equity-based compensation for awards granted prior to and in connection with our IPO, profits interests issued by our non-wholly owned subsidiaries, and unrealized mark-to-market changes in the fair value of the profits interests issued in the private wealth subsidiary, (d) amortization of intangibles, (e) net income (loss) attributable to non-controlling interests in our subsidiaries and realized gains attributable to the profits interests issued in the private wealth subsidiary, (f) charges associated with acquisitions and corporate transactions, and (g) certain other items that we believe are not indicative of our core operating performance (as listed in the table below). ANI is fully taxed at our blended statutory rate. We believe ANI and adjusted revenues are useful to investors because they enable investors to evaluate the performance of our business across reporting periods.
Fee-Related Earnings
Fee-related earnings, or “FRE,” is a non-GAAP performance measure used to monitor our baseline earnings from recurring management and advisory fees. FRE is a component of ANI and comprises adjusted management and advisory fees, net, less adjusted expenses which are operating expenses other than (a) performance fee-related compensation, (b) equity-based compensation for awards granted prior to and in connection with our IPO, profits interests issued by our non-wholly owned subsidiaries, and unrealized mark-to-market changes in the fair value of the profits interests issued in the private wealth subsidiary, (c) amortization of intangibles, (d) charges associated with acquisitions and corporate transactions, and (e) certain other items that we believe are not indicative of our core operating performance (as listed in the table below). FRE is presented before income taxes. We believe FRE is useful to investors because it provides additional insight into the operating profitability of our business and our ability to cover direct base compensation and operating expenses from total fee revenue.
The table below shows a reconciliation of GAAP measures to additional non-GAAP measures. We use the non-GAAP measures presented below as components when calculating FRE and ANI (as defined below). We believe these additional non-GAAP measures are useful to investors in evaluating both the baseline earnings from recurring management and advisory fees, which provide additional insight into the operating profitability of our business, and the after-tax net realized income attributable to us, allowing investors to evaluate the performance of our business. These additional non-GAAP measures remove the impact of Consolidated Funds that we are required to consolidate under GAAP, and certain other items that we believe are not indicative of our core operating performance.
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Three Months EndedYear Ended March 31,
(in thousands)March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024
GAAP management and advisory fees, net$132,573 $138,115 $142,123 $151,492 $153,410 $497,179 $585,140 
Management and advisory fee revenues for the Consolidated Funds(1)
147 186 204 451 398 147 1,239 
Adjusted management and advisory fees, net$132,720 $138,301 $142,327 $151,943 $153,808 $497,326 $586,379 
GAAP incentive fees$1,318 $6 $4,946 $17,891 $2,496 $9,663 $25,339 
Incentive fee revenues for the Consolidated Funds(2)
— — — — 1,549 — 1,549 
Adjusted incentive fees$1,318 $6 $4,946 $17,891 $4,045 $9,663 $26,888 
GAAP cash-based compensation$69,990 $70,081 $74,851 $73,619 $74,411 $252,180 $292,962 
Adjustments(3)
(653)(531)(574)(574)(461)(2,604)(2,140)
Adjusted cash-based compensation$69,337 $69,550 $74,277 $73,045 $73,950 $249,576 $290,822 
GAAP equity-based compensation$9,335 $8,472 $5,916 $14,032 $13,937 $24,940 $42,357 
Adjustments(4)
(8,274)(7,171)(4,644)(12,610)(12,210)(21,914)(36,635)
Adjusted equity-based compensation$1,061 $1,301 $1,272 $1,422 $1,727 $3,026 $5,722 
GAAP general, administrative and other$35,612 $33,277 $31,729 $48,001 $54,310 $147,159 $167,317 
Adjustments(5)
(11,086)(10,229)(8,778)(21,189)(27,079)(58,593)(67,275)
Adjusted general, administrative and other$24,526 $23,048 $22,951 $26,812 $27,231 $88,566 $100,042 
GAAP interest income$853 $431 $977 $827 $1,429 $1,921 $3,664 
Interest income earned by the Consolidated Funds(6)
(195)(244)(249)(540)(612)(195)(1,645)
Adjusted interest income$658 $187 $728 $287 $817 $1,726 $2,019 
GAAP other income (loss)$(40)$227 $(872)$4,408 $(1,308)$(1,420)$2,455 
Adjustments(7)
86 (376)403 (4,301)395 86 (3,879)
Adjusted other income (loss)$46 $(149)$(469)$107 $(913)$(1,334)$(1,424)
______________________________
(1)Reflects the add-back of management and advisory fee revenues for the Consolidated Funds, which have been eliminated in consolidation.
(2)Reflects the add back of incentive fee revenues for the Consolidated Funds, which have been eliminated in consolidation.
(3)Reflects the removal of severance and compensation paid to certain employees as part of an acquisition earn-out.
(4)Reflects the removal of equity-based compensation for awards granted prior to and in connection with the IPO, profits interests issued by our non-wholly owned subsidiaries, and unrealized mark-to-market changes in the fair value of the profits interests issued in the private wealth subsidiary.
(5)Reflects the removal of lease remeasurement adjustments, accelerated depreciation of leasehold improvements for changes in lease terms, amortization of intangibles, transaction-related costs and other non-core operating income and expenses.
(6)Reflects the removal of interest income earned by the Consolidated Funds.
(7)Reflects the removal of amounts for Tax Receivable Agreements adjustments recognized as other income (loss), gain associated with amounts received as part of negotiations with a third party related to certain corporate matters, loss on sale of subsidiary and the impact of consolidation of the Consolidated Funds.
8

The table below shows a reconciliation of income (loss) before income tax to ANI and FRE.
Three Months EndedYear Ended March 31,
(in thousands)March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024
Income (loss) before income tax$67,505 58,043 $66,980 $(24,142)$94,515 $(41,454)$195,396 
Net income attributable to non-controlling interests in subsidiaries(1)
(10,151)(10,540)(10,321)(15,537)(12,822)(39,054)(49,220)
Net loss attributable to non-controlling interests in legacy Greenspring entities11,148 2,866 3,966 2,222 33 44,075 9,087 
Unrealized carried interest allocations(100,753)(49,364)(55,371)129,584 (151,757)253,342 (126,908)
Unrealized performance fee-related compensation53,515 24,211 28,712 (62,243)84,014 (119,039)74,694 
Unrealized investment (income) loss(2,207)(2,529)(1,657)5,559 (2,280)8,012 (907)
Impact of Consolidated Funds(4,002)(2,647)(8,223)(11,068)(4,138)(8,897)(26,076)
Deferred incentive fees209 — 942 — 1,450 3,892 2,392 
Equity-based compensation(2)
8,274 7,171 4,644 12,610 12,210 21,914 36,635 
Amortization of intangibles10,870 10,661 10,661 10,661 10,423 43,481 42,406 
Tax Receivable Agreements adjustments through earnings(244)— — 222 90 (244)312 
Non-core items(3)
733 (50)(1,500)6,335 16,780 17,580 21,565 
Pre-tax ANI34,897 37,822 38,833 54,203 48,518 183,608 179,376 
Income taxes(4)
(7,782)(8,434)(8,660)(12,087)(10,802)(40,945)(39,983)
ANI27,115 29,388 30,173 42,116 37,716 142,663 139,393 
Income taxes(4)
7,782 8,434 8,660 12,087 10,802 40,945 39,983 
Realized carried interest allocations(18,693)(14,473)(1,585)(15,289)(18,054)(131,089)(49,401)
Realized performance fee-related compensation(5)
12,755 9,102 1,720 15,444 11,421 79,846 37,687 
Realized investment income(757)(557)(1,423)(3,508)(1,057)(5,503)(6,545)
Adjusted incentive fees(6)
(1,318)(6)(4,946)(17,891)(4,045)(9,663)(26,888)
Deferred incentive fees(209)— (942)— (1,450)(3,892)(2,392)
Adjusted interest income(6)
(658)(187)(728)(287)(817)(1,726)(2,019)
Interest expense1,674 2,012 2,108 2,562 2,649 4,189 9,331 
Adjusted other (income) loss(6)(7)
(46)149 469 (107)913 1,334 1,424 
Net income attributable to non-controlling interests in subsidiaries(1)
10,151 10,540 10,321 15,537 12,822 39,054 49,220 
FRE$37,796 $44,402 $43,827 $50,664 $50,900 $156,158 $189,793 
_______________________________
(1)Reflects the portion of pre-tax ANI attributable to non-controlling interests in our subsidiaries and realized gains attributable to the profits interests issued in the private wealth subsidiary:
Three Months EndedYear Ended March 31,
(in thousands)March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024
FRE attributable to non-controlling interests in subsidiaries
$9,843 $10,534 $9,463 $10,518 $11,559 $38,673 $42,074 
Non fee-related earnings attributable to non-controlling interests in subsidiaries and profits interests
308 6 858 5,019 1,263 381 7,146 
Net income attributable to non-controlling interests in subsidiaries
$10,151 $10,540 $10,321 $15,537 $12,822 $39,054 $49,220 
(2)Reflects equity-based compensation for awards granted prior to and in connection with the IPO, profits interests issued by our non-wholly owned subsidiaries, and unrealized mark-to-market changes in the fair value of the profits interests issued in the private wealth subsidiary.
9

(3)Includes (income) expense related to the following non-core operating income and expenses:
Three Months EndedYear Ended March 31,
(in thousands)March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024
Transaction costs$38 $37 $163 $670 $3,985 $6,853 $4,855 
Lease remeasurement adjustments— — — (106)— (2,709)(106)
Accelerated depreciation of leasehold improvements for changes in lease terms631 631 631 631 — 1,472 1,893 
Severance costs73 — — — — 293 — 
(Gain) loss on change in fair value for contingent consideration obligation(588)(1,249)(2,868)9,054 12,280 9,361 17,217 
Compensation paid to certain employees as part of an acquisition earn-out579 531 574 574 515 2,310 2,194 
Gain from negotiation of certain corporate matters— — — (5,300)— — (5,300)
Loss on sale of subsidiary— — — 812 — — 812 
Total non-core operating income and expenses$733 $(50)$(1,500)$6,335 $16,780 $17,580 $21,565 
(4)Represents corporate income taxes at a blended statutory rate applied to pre-tax ANI:
Three Months EndedYear Ended March 31,
March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024
Federal statutory rate21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %21.0 %
Combined state, local and foreign rate1.3 %1.3 %1.3 %1.3 %1.3 %1.3 %1.3 %
Blended statutory rate22.3 %22.3 %22.3 %22.3 %22.3 %22.3 %22.3 %
(5)Includes carried interest-related compensation expense related to the portion of net carried interest allocation revenue attributable to equity holders of the Company’s consolidated subsidiaries that are not 100% owned:
Three Months EndedYear Ended March 31,
(in thousands)March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024
Realized carried interest-related compensation$2,358 $2,189 $— $660 $910 $11,375 $3,759 
(6)Excludes the impact of consolidating the Consolidated Funds.
(7)Excludes amounts for Tax Receivable Agreements adjustments recognized as other income (loss) ($(0.1) million for the three months ended March 31, 2024, $(0.2) million for the three months ended December 31, 2023 and $0.2 million for the three months ended March 31, 2023, and $(0.3) million and $0.2 million in fiscal 2024 and fiscal 2023, respectively), gain associated with amounts received as part of negotiations with a third party related to certain corporate matters ($5.3 million for the three months ended December 31, 2023 and in fiscal 2024), and loss on sale of subsidiary ($0.8 million for the three months ended December 31, 2023 and in fiscal 2024).
Fee-Related Earnings Margin
FRE margin is a non-GAAP performance measure which is calculated by dividing FRE by adjusted management and advisory fees, net. We believe FRE margin is an important measure of profitability on revenues that are largely recurring by nature. We believe FRE margin is useful to investors because it enables them to better evaluate the operating profitability of our business across periods.
The table below shows a reconciliation of FRE to FRE margin.
Three Months EndedYear Ended March 31,
(in thousands)March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024
FRE$37,796 $44,402 $43,827 $50,664 $50,900 $156,158 $189,793 
Adjusted management and advisory fees, net132,720 138,301 142,327 151,943 153,808 497,326 586,379 
FRE margin28 %32 %31 %33 %33 %31 %32 %
10

Gross Realized Performance Fees
Gross realized performance fees represents realized carried interest allocations and adjusted incentive fees, including the deferred portion. We believe gross realized performance fees is useful to investors because it presents the total performance fees realized by us.
Net Realized Performance Fees
Net realized performance fees represents gross realized performance fees, less realized performance fee-related compensation. We believe net realized performance fees is useful to investors because it presents the performance fees attributable to us, net of amounts paid to employees as performance fee-related compensation.
The table below shows a reconciliation of total performance fees to gross and net realized performance fees.
Three Months EndedYear Ended March 31,
(in thousands)March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024
Incentive fees$1,318 $6 $4,946 $17,891 $2,496 $9,663 $25,339 
Realized carried interest allocations
18,693 14,473 1,585 15,289 18,054 131,089 49,401 
Unrealized carried interest allocations100,753 49,364 55,371 (129,584)151,757 (253,342)126,908 
Legacy Greenspring carried interest allocations(80,963)(23,947)(12,603)(69,700)31,093 (452,163)(75,157)
Total performance fees39,801 39,896 49,299 (166,104)203,400 (564,753)126,491 
Unrealized carried interest allocations(100,753)(49,364)(55,371)129,584 (151,757)253,342 (126,908)
Legacy Greenspring carried interest allocations80,963 23,947 12,603 69,700 (31,093)452,163 75,157 
Incentive fee revenues for the Consolidated Funds(1)
— — — — 1,549 — 1,549 
Deferred incentive fees209 — 942 — 1,450 3,892 2,392 
Gross realized performance fees20,220 14,479 7,473 33,180 23,549 144,644 78,681 
Realized performance fee-related compensation
(12,755)(9,102)(1,720)(15,444)(11,421)(79,846)(37,687)
Net realized performance fees$7,465 $5,377 $5,753 $17,736 $12,128 $64,798 $40,994 
_______________________________
(1)Reflects the add back of incentive fee revenues for the Consolidated Funds, which have been eliminated in consolidation.
11

Adjusted Weighted-Average Shares and Adjusted Net Income Per Share
ANI per share measures our per-share earnings assuming all Class B units and Class C units in the Partnership were exchanged for Class A common stock in SSG, including the dilutive impact of outstanding equity-based awards. ANI per share is calculated as ANI divided by adjusted weighted-average shares outstanding. We believe adjusted weighted-average shares and ANI per share are useful to investors because they enable investors to better evaluate per-share operating performance across reporting periods.
The following table shows a reconciliation of diluted weighted-average shares of Class A common stock outstanding to adjusted weighted-average shares outstanding used in the computation of ANI per share.
Three Months EndedYear Ended March 31,
March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024
ANI$27,115 $29,388 $30,173 $42,116 $37,716 $142,663 $139,393 
Weighted-average shares of Class A common stock outstanding – Basic62,805,788 62,834,818 62,858,468 64,068,952 64,194,859 61,884,671 63,489,135 
Assumed vesting of RSUs524,576 400,034 801,014 333,402 512,946 669,966 512,152 
Assumed vesting and exchange of Class B2 units2,501,045 2,504,618 2,538,647 2,553,899 2,573,762 2,475,501 2,542,751 
Exchange of Class B units in the Partnership(1)
46,420,141 46,420,141 46,417,845 46,314,543 46,272,227 46,780,724 46,356,244 
Exchange of Class C units in the Partnership(2)
2,514,085 2,514,085 2,502,086 1,962,131 1,958,507 2,807,243 2,234,191 
Adjusted weighted-average shares114,765,635 114,673,696 115,118,060 115,232,927 115,512,301 114,618,105 115,134,473 
ANI per share$0.24 $0.26 $0.26 $0.37 $0.33 $1.24 $1.21 
_______________________________
(1)Assumes the full exchange of Class B units in the Partnership for Class A common stock of SSG pursuant to the Class B Exchange Agreement.
(2)Assumes the full exchange of Class C units in the Partnership for Class A common stock of SSG pursuant to the Class C Exchange Agreement.
12

Key Operating Metrics
We monitor certain operating metrics that are either common to the asset management industry or that we believe provide important data regarding our business. Refer to the Glossary below for a definition of each of these metrics.
Fee-Earning AUM
Three Months EndedYear Ended March 31,Percentage Change
(in millions)March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 202420232024vs. FQ4'23
Separately Managed Accounts
Beginning balance$53,420 $55,345 $56,645 $56,380 $56,660 $49,586 $55,345 6 %
Contributions(1)
2,378 1,425 1,036 1,109 2,757 9,658 6,327 16 %
Distributions(2)
(997)(429)(1,459)(1,397)(795)(4,208)(4,080)(20)%
Market value, FX and other(4)
544 304 158 568 275 309 1,305 (49)%
Ending balance$55,345 $56,645 $56,380 $56,660 $58,897 $55,345 $58,897 6 %
Focused Commingled Funds
Beginning balance$29,565 $30,086 $30,762 $30,905 $32,772 $25,587 $30,086 11 %
Contributions(1)
713 796 992 1,898 2,429 5,509 6,115 241 %
Distributions(2)
(308)(252)(988)(274)(327)(1,162)(1,841)6 %
Market value, FX and other(3)
116 132 139 243 87 152 601 (25)%
Ending balance$30,086 $30,762 $30,905 $32,772 $34,961 $30,086 $34,961 16 %
Total
Beginning balance$82,985 $85,431 $87,407 $87,285 $89,432 $75,173 $85,431 8 %
Contributions(1)
3,091 2,221 2,028 3,007 5,186 15,167 12,442 68 %
Distributions(2)
(1,305)(681)(2,447)(1,671)(1,122)(5,370)(5,921)(14)%
Market value, FX and other(3)
660 436 297 811 362 461 1,906 (45)%
Ending balance$85,431 $87,407 $87,285 $89,432 $93,858 $85,431 $93,858 10 %
_______________________________
(1)Contributions consist of new capital commitments that earn fees on committed capital and capital contributions to funds and accounts that earn fees on net invested capital or NAV.
(2)Distributions consist of returns of capital from funds and accounts that pay fees on net invested capital or NAV and reductions in fee-earning AUM from funds that moved from a committed capital to net invested capital fee basis or from funds and accounts that no longer pay fees.
(3)Market value, FX and other primarily consist of changes in market value appreciation (depreciation) for funds that pay on NAV and the effect of foreign exchange rate changes on non-U.S. dollar denominated commitments.
13

Asset Class Summary
Three Months EndedPercentage Change
(in millions)March 31, 2023June 30, 2023September 30, 2023December 31, 2023March 31, 2024vs. FQ4'23
FEAUM
Private equity$45,766 $46,539 $46,464 $48,258 $49,869 9%
Infrastructure19,274 19,874 20,122 19,789 20,114 4%
Private debt14,361 14,865 15,122 15,460 15,477 8%
Real estate6,030 6,129 5,577 5,925 8,398 39%
Total$85,431 $87,407 $87,285 $89,432 $93,858 10%
Separately managed accounts$55,345 $56,645 $56,380 $56,660 $58,897 6%
Focused commingled funds30,086 30,762 30,905 32,772 34,961 16%
Total$85,431 $87,407 $87,285 $89,432 $93,858 10%
AUM(1)
Private equity$71,611 $73,511 $76,031 $78,221 $81,942 14%
Infrastructure27,285 28,521 28,678 28,307 30,003 10%
Private debt26,592 27,099 27,520 27,782 28,491 7%
Real estate12,891 13,469 13,612 14,646 16,201 26%
Total$138,379 $142,600 $145,841 $148,956 $156,637 13%
Separately managed accounts$82,243 $85,058 $85,387 $88,890 $93,938 14%
Focused commingled funds43,062 44,389 46,266 45,508 48,545 13%
Advisory AUM13,074 13,153 14,188 14,558 14,154 8%
Total$138,379 $142,600 $145,841 $148,956 $156,637 13%
Advisory AUA
Private equity$242,461 $251,880 $264,327 $266,246 $270,350 12%
Infrastructure50,700 53,593 55,146 57,528 60,339 19%
Private debt17,362 17,525 18,026 17,916 21,976 27%
Real estate171,668 173,992 175,369 168,802 168,455 (2)%
Total$482,191 $496,990 $512,868 $510,492 $521,120 8%
Total capital responsibility(2)
$620,570 $639,590 $658,709 $659,448 $677,757 9%
_____________________________
Note: Amounts may not sum to total due to rounding. AUM/AUA reflects final data for the prior period, adjusted for net new client account activity through the period presented, and does not include post-period investment valuation or cash activity. Net asset value (“NAV”) data for underlying investments is as of the prior period, as reported by underlying managers up to the business day occurring on or after 100 days, or 115 days at the fiscal year-end, following the prior period end. When NAV data is not available by the business day occurring on or after 100 days, or 115 days at the fiscal year-end, following the prior period end, such NAVs are adjusted for cash activity following the last available reported NAV.
(1)Allocation of AUM by asset class is presented by underlying investment asset classification.
(2)Total capital responsibility equals assets under management (AUM) plus assets under advisement (AUA).
14

Contacts
Shareholder Relations:
Seth Weiss
shareholders@stepstonegroup.com
1-212-351-6106
Media:
Brian Ruby / Chris Gillick / Matt Lettiero, ICR
StepStonePR@icrinc.com
1-203-682-8268
15

Glossary
Assets under advisement, or “AUA,” consists of client assets for which we do not have full discretion to make investment decisions but play a role in advising the client or monitoring their investments. We generally earn revenue for advisory-related services on a contractual fixed fee basis. Advisory-related services include asset allocation, strategic planning, development of investment policies and guidelines, screening and recommending investments, legal negotiations, monitoring and reporting on investments, and investment manager review and due diligence. Advisory fees vary by client based on the scope of services, investment activity and other factors. Most of our advisory fees are fixed, and therefore, increases or decreases in AUA do not necessarily lead to proportionate changes in revenue. We believe AUA is a useful metric for assessing the relative size of our advisory business.
Our AUA is calculated as the sum of (i) the NAV of client portfolio assets for which we do not have full discretion and (ii) the unfunded commitments of clients to the underlying investments. Our AUA reflects the investment valuations in respect of the underlying investments of our client accounts on a three-month lag, adjusted for new client account activity through the period end. Our AUA does not include post-period investment valuation or cash activity. AUA as of March 31, 2024 reflects final data for the prior period (December 31, 2023), adjusted for net new client account activity through March 31, 2024. NAV data for underlying investments is as of December 31, 2023, as reported by underlying managers up to the business day occurring on or after 115 days following December 31, 2023. When NAV data is not available by the business day occurring on or after 115 days following December 31, 2023, such NAVs are adjusted for cash activity following the last available reported NAV.
Assets under management, or “AUM,” primarily reflects the assets associated with our separately managed accounts (“SMAs”) and focused commingled funds. We classify assets as AUM if we have full discretion over the investment decisions in an account or have responsibility or custody of assets. Although management fees are based on a variety of factors and are not linearly correlated with AUM, we believe AUM is a useful metric for assessing the relative size and scope of our asset management business.
Our AUM is calculated as the sum of (i) the net asset value (“NAV”) of client portfolio assets, including the StepStone Funds and (ii) the unfunded commitments of clients to the underlying investments and the StepStone Funds. Our AUM reflects the investment valuations in respect of the underlying investments of our funds and accounts on a three-month lag, adjusted for new client account activity through the period end. Our AUM does not include post-period investment valuation or cash activity. AUM as of March 31, 2024 reflects final data for the prior period (December 31, 2023), adjusted for net new client account activity through March 31, 2024. NAV data for underlying investments is as of December 31, 2023, as reported by underlying managers up to the business day occurring on or after 115 days following December 31, 2023. When NAV data is not available by the business day occurring on or after 115 days following December 31, 2023, such NAVs are adjusted for cash activity following the last available reported NAV.
Consolidated Funds refer to the StepStone Funds that we are required to consolidate as of the applicable reporting period. We consolidate funds and other entities in which we hold a controlling financial interest.
Consolidated VIEs refer to the variable interest entities that we are required to consolidate as of the applicable reporting period. We consolidate VIEs in which we hold a controlling financial interest.
Fee-earning AUM, or “FEAUM,” reflects the assets from which we earn management fee revenue (i.e., fee basis) and includes assets in our SMAs, focused commingled funds and assets held directly by our clients for which we have fiduciary oversight and are paid fees as the manager of the assets. Our SMAs and focused commingled funds typically pay management fees based on capital commitments, net invested capital and, in certain cases, NAV, depending on the fee terms. Management fees are only marginally affected by market appreciation or depreciation because substantially all of the StepStone Funds pay management fees based on capital commitments or net invested capital. As a result, management fees and FEAUM are not materially affected by changes in market
16

value. We believe FEAUM is a useful metric in order to assess assets forming the basis of our management fee revenue.
Legacy Greenspring entities refers to certain entities for which the Company, indirectly through its subsidiaries, became the sole and/or managing member in connection with the Greenspring acquisition.
SSG refers solely to StepStone Group Inc., a Delaware corporation, and not to any of its subsidiaries.
StepStone Funds refer to SMAs and focused commingled funds of the Company, including acquired Greenspring funds, for which the Partnership or one of its subsidiaries acts as both investment adviser and general partner or managing member.
The Partnership refers solely to StepStone Group LP, a Delaware limited partnership, and not to any of its subsidiaries.
Total capital responsibility equals AUM plus AUA. AUM includes any accounts for which StepStone Group has full discretion over the investment decisions, has responsibility to arrange or effectuate transactions, or has custody of assets. AUA refers to accounts for which StepStone Group provides advice or consultation but for which the firm does not have discretionary authority, responsibility to arrange or effectuate transactions, or custody of assets.
Undeployed fee-earning capital represents the amount of capital commitments to StepStone Funds that has not yet been invested or considered active but will generate management fee revenue once this capital is invested or activated. We believe undeployed fee-earning capital is a useful metric for measuring the amount of capital that we can put to work in the future and thus earn management fee revenue thereon.


17
v3.24.1.1.u2
Document and Entity Information Document
May 23, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date May 23, 2024
Entity Registrant Name STEPSTONE GROUP INC.
Entity Central Index Key 0001796022
Amendment Flag false
Entity Incorporation, State or Country Code DE
Entity File Number 001-39510
Entity Tax Identification Number 84-3868757
Entity Address, Address Line One 277 Park Avenue, 45th Floor
Entity Address, City or Town New York,
Entity Address, State or Province NY
Entity Address, Postal Zip Code 10172
City Area Code 212
Local Phone Number 351-6100
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Class A common stock, par value $0.001 per share
Trading Symbol STEP
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
StepStone (NASDAQ:STEP)
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