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What changed in TPG Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of TPG Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+883 added−1126 removedSource: 10-K (2025-02-18) vs 10-K (2024-02-23)

Top changes in TPG Inc.'s 2024 10-K

883 paragraphs added · 1126 removed · 688 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

111 edited+31 added−53 removed94 unchanged
Biggest changePlatform: Impact Our multi-fund Impact platform pursues both competitive financial returns and measurable societal benefits at scale, harnessing the diverse skills of a differentiated group of stakeholders: • Y Analytics: A public benefit organization that is wholly owned by TPG and which we founded to provide impact research and rigorous assessment measures for impact investments, and today functions as TPG’s firm-wide ESG and impact performance arm. • The TPG Rise Global Advisory Board: A group of experienced investors and global thought leaders with a deep personal and professional commitment to driving social and environmental change. • The TPG Rise Climate Coalition: A partnership between TPG and 28 leading global corporations to identify and share best practices for considering climate solutions investment opportunities through TPG Rise Climate.
Biggest changeLSI invests across different therapeutic areas and stages, from company creation to IPO, and leverages TPG’s broad experience in the healthcare sector. 6 Table of Contents Platform: Impact Our multi-fund Impact platform, which we believe is among the largest in the industry, pursues competitive, non-concessionary financial returns while also providing measurable societal benefits at scale, harnessing the diverse skills of a differentiated group of value-add stakeholders including: • Y Analytics: A public benefit organization that is wholly owned by TPG and which we founded to provide impact research and rigorous assessment measures for impact investments, and today functions as TPG’s firm-wide Responsible Investing and impact performance arm. • The TPG Rise Global Advisory Board: A group of experienced investors and global thought leaders with a deep personal and professional commitment to driving social and environmental change consistent with achieving non-concessionary financial returns. • The TPG Rise Climate Coalition: A partnership between TPG and 30 leading global corporations that are investors in TPG Rise Climate, to accelerate the sharing of knowledge, best practices and investment opportunities arising from the energy transition among the group and more broadly across the TPG Impact platform.
In an effort to manage possible risks relating to the receipt of material, non-public information and our decision not to implement information barriers among many investment platforms, we maintain a list of issuers applicable to each side of an information barrier for which we have access to material, non-public information and in whose securities the funds, accounts and investment professionals on that side of the information barrier are not permitted to trade.
In an effort to manage possible risks relating to the receipt of material, non-public information and our decision not to implement information barriers among many investment platforms, we maintain a list of issuers applicable to each side of the information barrier for which we have access to material, non-public information and in whose securities the funds, accounts and investment professionals on that side of the information barrier are not permitted to trade.
United Kingdom TPG Europe LLP (“TPG Europe”) and Angelo, Gordon Europe LLP (“AG Europe”) are our London-based affiliates that are authorized and regulated by the U.K. Financial Conduct Authority (“FCA”) under the Financial Services and Markets Act 2000 (the “FSMA”).
United Kingdom TPG Europe LLP (“TPG Europe”) and Angelo, Gordon Europe LLP (“AG Europe”) are our London-based affiliates that are authorized and regulated by the U.K. Financial Conduct Authority (“FCA”) under the Financial Services and Markets Act 2000 (“FSMA”).
The FSMA and related rules, including the FCA’s rules and guidance, govern most aspects of investment business, including provision of investment advice, use and safekeeping of client funds and securities, regulatory capital, record-keeping, approval standards for individuals, anti-money laundering and periodic reporting. The FCA is responsible for administering these requirements and our compliance with the FSMA and related rules.
FSMA and related rules, including the FCA’s rules and guidance, govern most aspects of investment business, including provision of investment advice, use and/or safekeeping of client funds and securities, regulatory capital, record-keeping, approval standards for individuals, anti-money laundering and periodic regulatory reporting. The FCA is responsible for administering these requirements and our compliance with FSMA and related rules.
Primary activities include: • Debt Capital Markets: (i) Structure and execute new deal and acquisition financings across leveraged loans, high yield bonds and mezzanine debt (privately placed and syndicated) and (ii) manage capital structures on an ongoing basis, including re-financings, re-pricings, hedging, amendments and extensions and other services. • Equity Capital Markets: (i) Act as lead advisor and underwriter on capital raises and the monetization of our ownership stakes in the public equity markets, including initial public offerings, follow-on offerings, equity-linked products and subsequent realizations and (ii) provide dual-track and structured equity solutions advisory, among other services.
Primary activities include: 11 Table of Contents • Debt Capital Markets: (i) Structure and execute new deal and acquisition financings across leveraged loans, high yield bonds and mezzanine debt (privately placed and syndicated) and (ii) manage capital structures on an ongoing basis, including re-financings, re-pricings, hedging, amendments and extensions and other services. • Equity Capital Markets: (i) Act as lead advisor and underwriter on capital raises and the monetization of our ownership stakes in the public equity markets, including initial public offerings, follow-on offerings, equity-linked products and subsequent realizations and (ii) provide dual-track and structured equity solutions advisory, among other services.
These individuals include current and former chief executive officers, chief financial officers and chairpersons of major corporations, and others holding leading positions of corporations and agencies worldwide. Corporate Social Responsibility We strive to invest in our local communities and engaging our people and other stakeholders in making a meaningful impact, whether through charitable donations or volunteer time.
These individuals include current and former chief executive officers, chief financial officers and chairpersons of major corporations, and others holding leading positions of corporations and agencies worldwide. Corporate Social Responsibility We strive to invest in our local communities and engage our people and other stakeholders in making a meaningful impact, whether through charitable donations or volunteer time.
TPG Inc.’s assets consist primarily of units representing approximately 22% of the TPG Operating Group held through its 100% interest in certain holding companies. TPG Inc. is also the owner of the entities serving as the general partner of the TPG Operating Group partnerships and, in such capacity, indirectly controls all of the TPG Operating Group’s business and affairs.
TPG Inc.’s assets consist primarily of units representing approximately 30% of the TPG Operating Group held through its 100% interest in certain holding companies. TPG Inc. is also the owner of the entities serving as the general partner of the TPG Operating Group partnerships and, in such capacity, indirectly controls all of the TPG Operating Group’s business and affairs.
Through multiple decades of experience, we have developed an ecosystem of insight, engagement and collaboration across our platforms and products, which currently include over 300 active portfolio companies, over 300 real estate properties and over 5,000 credit positions across more than 30 countries.
Through multiple decades of experience, we have developed an ecosystem of insight, engagement and collaboration across our platforms and products, which currently include approximately 350 active portfolio companies, more than 300 real estate properties and over 5,000 credit positions, across more than 30 countries.
TRECO focuses on select sectors and geographies where we have distinct expertise informed by our longstanding practice around theme development. The fund has a flexible mandate and will aim to invest opportunistically across the credit spectrum. Platform: Market Solutions Our Market Solutions platform leverages the broader TPG ecosystem to create differentiated products in order to address specific market opportunities.
TRECO focuses on select sectors and geographies where we have distinct expertise informed by our longstanding practice around theme development. The fund has a flexible mandate and seeks to invest opportunistically across the credit spectrum. Platform: Market Solutions Our Market Solutions platform leverages the broader TPG ecosystem to create differentiated products in order to address specific market opportunities.
We offer our employees a learning reimbursement stipend to encourage them to apply for certifications and attend classes or conferences related to their role to further their professional growth. 14 Table of Contents We believe our culture of apprenticeship also helps to ensure our employees feel connected to the greater firm as they learn, grow and develop by partnering with their colleagues.
We offer our employees a learning reimbursement stipend to encourage them to apply for certifications and attend classes or conferences related to their role to further their professional growth. We believe our culture of apprenticeship also helps to ensure our employees feel connected to the greater firm as they learn, grow and develop by partnering with their colleagues.
To maintain its qualifications as a REIT, TRTX and MITT generally must distribute at least 90% of their respective net taxable income to its stockholders and meet, on a continuing basis, certain other complex requirements under the Code. 22 Table of Contents Regulation as a BDC TCAP has elected to be regulated as a business development company under the Investment Company Act.
To maintain its qualifications as a REIT, TRTX and MITT generally must distribute at least 90% of their respective net taxable income to its stockholders and meet, on a continuing basis, certain other complex requirements under the Code. Regulation as a BDC TCAP has elected to be regulated as a business development company under the Investment Company Act.
Additional sanctions that may be imposed for failure to comply with applicable requirements include the prohibition of individuals from associating with an investment adviser, the revocation of registrations and other censures and fines. 21 Table of Contents Regulation Under the Investment Company Act We regard ourselves as an alternative asset management firm.
Additional sanctions that may be imposed for failure to comply with applicable requirements include the prohibition of individuals from associating with an investment adviser, the revocation of registrations and other censures and fines. Regulation Under the Investment Company Act We regard ourselves as an alternative asset management firm.
In order to invest in our people and to foster community, we continue to expand our employee and manager training programs, as described in detail under “—Learning and Engagement Initiatives” below. Learning and Engagement Initiatives Employee Training and Mentorship : We have instituted various “learning initiatives” as a part of our commitment to invest in the development of our employees.
In order to invest in our people and to foster community, we continue to expand our employee and manager training programs, as described in detail under “—Learning and Engagement Initiatives” below. 13 Table of Contents Learning and Engagement Initiatives Employee Training and Mentorship : We have instituted various “learning initiatives” as a part of our commitment to invest in the development of our employees.
For our private equity investments, the due diligence effort also typically includes on-site visits, interviews and meetings with management, research, evaluation and analyses related to the potential investment’s industry, markets, products and services, and competitive positioning, and background checks of the management team.
For our private equity investments, the due diligence effort also typically includes on-site visits, interviews and meetings with management, research, evaluation and analyses related to the 15 Table of Contents potential investment’s industry, markets, products and services, and competitive positioning, and background checks of the management team.
We have in place certain procedures to allocate investment opportunities among our funds in a way that complies with our duties as managers of the applicable funds and that we believe is equitable, fair and in the best interests of the applicable funds. 16 Table of Contents Our investment professionals are actively involved in the investment process.
We have in place certain procedures to allocate investment opportunities among our funds in a way that complies with our duties as managers of the applicable funds and that we believe is equitable, fair and in the best interests of the applicable funds. Our investment professionals are actively involved in the investment process.
TPG Growth seeks to make growth buyout and growth equity investments, primarily in North America and India. Product: TPG Tech Adjacencies TPG Tech Adjacencies, or “TTAD”, with $6.7 billion in assets under management as of December 31, 2023, is a product we developed organically to pursue minority and/or structured investments in internet, software, digital media and other technology sectors.
TPG Growth seeks to make growth buyout and growth equity investments, primarily in North America and India. Product: TPG Tech Adjacencies TPG Tech Adjacencies, or “TTAD”, with $7.1 billion in assets under management as of December 31, 2024, is a product we developed organically to pursue minority and/or structured investments in internet, software, digital media and other technology sectors.
In addition, under certain current SEC interpretations, Section 7(d) of the Investment Company Act exempts from registration any non-U.S. investment fund all of whose outstanding securities are beneficially owned either by non-U.S. residents or by U.S. residents that are qualified purchasers and purchase their interests in a private placement.
In addition, under certain current Securities and Exchange Commission (“SEC”) interpretations, Section 7(d) of the Investment Company Act exempts from registration any non-U.S. investment fund all of whose outstanding securities are beneficially owned either by non-U.S. residents or by U.S. residents that are qualified purchasers and purchase their interests in a private placement.
The investment strategy is designed to enhance traditional core-plus objectives of capital preservation and reliable current income generation by applying our differentiated thematic approach, strategy and skillset. Product: TPG RE Finance Trust, Inc. TPG RE Finance Trust, Inc.
The investment strategy is designed to enhance traditional core-plus objectives of capital preservation and reliable current income generation by applying our differentiated thematic approach, strategy and skillset. Product: Real Estate Credit TPG RE Finance Trust, Inc. TPG RE Finance Trust, Inc.
To access these filings, go to the “SEC Filings” portion of our 23 Table of Contents “Shareholders” page on our website. You may also access the reports and other documents we file with the SEC at a website maintained by the SEC at www.sec.gov.
To access these filings, go to the “SEC Filings” portion of our “Shareholders” page on our website. You may also access the reports and other documents we file with the SEC at a website maintained by the SEC at www.sec.gov.
Our private markets solutions business is organized into two businesses: (1) NewQuest and (2) TPG GP Solutions (“TGS”). 11 Table of Contents NewQuest Capital Partners NewQuest seeks to acquire private equity positions on a secondary basis in underlying portfolio companies whose businesses are substantially based in the Asia Pacific region.
Our private markets solutions business is organized into two businesses: (1) NewQuest and (2) TPG GP Solutions (“TGS”). NewQuest Capital Partners NewQuest seeks to acquire private equity positions on a secondary basis in underlying portfolio companies whose businesses are substantially based in the Asia Pacific region.
TPG AG Multi-Strategy offers actively managed co-mingled funds, including its Super Fund (“Super Fund”), in addition to bespoke vehicles and various multi-strategy credit funds of one. These funds invest in public and private investment opportunities sourced from across TPG AG Credit, as well as arbitrage strategies, including convertible arbitrage and merger arbitrage.
TPG AG Multi-Strategy offers actively managed co-mingled funds, including the Super Fund, in addition to bespoke vehicles and various multi-strategy credit funds of one. These funds invest in public and private investment opportunities sourced from across TPG AG Credit, as well as arbitrage strategies, including convertible arbitrage and merger arbitrage.
Most of our funds also have an advisory committee, comprising representatives of certain limited partners, which may consider or waive conflicts of interest or other restrictions in the partnership agreement or otherwise consult with the general partner on certain partnership matters. There are non-U.S. funds that are structured as corporate or non-partnership entities under applicable law.
Most of our funds also have an advisory committee, comprising representatives of certain limited partners, which may consider or waive conflicts of interest or other restrictions in the partnership agreement or otherwise consult with the general partner on certain partnership matters. Several funds are structured as corporate or non-partnership entities under applicable law.
Product: TPG Real Estate Thematic Advantage Core-Plus TPG Real Estate Thematic Advantage Core-Plus (“TAC+”), with $1.7 billion in assets under management, is an extension of our opportunistic real estate investment program. TAC+ targets investments in stabilized (or near stabilized) high-quality real estate, particularly in thematic sectors where we have gained significant experience and conviction.
Product: TPG Real Estate Thematic Advantage Core-Plus TPG Real Estate Thematic Advantage Core-Plus (“TAC+”), with $1.8 billion in assets under management as of December 31, 2024, is an extension of our opportunistic real estate investment program. TAC+ targets investments in stabilized (or near stabilized) high-quality real estate, particularly in thematic sectors where we have gained significant experience and conviction.
These learning initiatives focus on a variety of areas, including culture, diversity, equity and inclusion (“DEI”), functional and technical knowledge, leadership and management and professional growth. We have tailored learning initiatives for our new employees to facilitate their integration into the firm.
These learning initiatives focus on a variety of areas, including culture, functional and technical knowledge, inclusivity, leadership and management, and professional growth. We have tailored learning initiatives for our new employees to facilitate their integration into the firm.
TPG AG Credit’s capabilities span private and tradeable credit across corporate and asset-backed markets.
TPG AG Credit’s capabilities span private and tradable credit across corporate and asset-backed markets.
We have built our firm through more than 30 years of successful innovation and growth, and believe that we have delivered attractive risk-adjusted returns to our clients and established a premier investment business focused on the fastest-growing segments of both the alternative asset management industry and the global economy.
We have built our firm through years of successful innovation and growth, and believe that we have delivered attractive risk-adjusted returns to our clients and established a premier investment business focused on the fastest-growing segments of the alternative asset management industry.
We have recorded a contingent repayment obligation of $58.3 million as of December 31, 2023, equal to the amount that would be due if the various funds were liquidated at their current carrying value.
We have recorded a contingent repayment obligation of $5.5 million as of December 31, 2024, equal to the amount that would be due if the various funds were liquidated at their current carrying value.
We and our affiliates generally also make a commitment to our funds, which can be as much as 5% of the fund’s total limited partner capital commitments. Fund commitments are generally available for investment and other fund purposes during what we call the investment period or commitment period, which typically runs six or fewer years for each fund.
We and our affiliates can also make commitments to our funds that generally are less than 5% of the fund’s total limited partner capital commitments. Fund commitments are generally available for investment and other fund purposes during what we call the investment period or commitment period, which typically runs six or fewer years for each fund.
Performance allocations are generally calculated on a realized basis, and each general partner (or affiliate) is typically entitled to an allocation of 20% of the net realized profits (also taking into account, among other things, unrealized losses) generated by such fund.
Performance allocations are generally calculated on a realized basis, and each general partner (or affiliate) is typically entitled to an allocation of up to 20% of the net realized profits (also taking into account, among other things, unrealized losses) generated by such fund. Net realized income or loss is not netted between or among funds.
We also provide investment management services to certain funds in which we earn management fees and incentive fees based on their equity value and core earnings, subject to preferred returns or high watermarks, where applicable. The associated management fees and incentive fees are payable quarterly in arrears.
We also provide investment management services to certain funds in which we earn management fees and incentive fees based on their equity value and core earnings, subject to preferred returns or high watermarks, where applicable.
The strength of our investment performance, our ability to innovate within our business and our focus on strategic, inorganic growth has led to consistent historical growth in our assets under management, all on a scaled infrastructure that gives our business a high degree of operating leverage.
The strength of our investment performance and our proven ability to innovate within our business, together with our ongoing focus on strategic, inorganic growth has led to consistent historical growth in our assets under management, all with the support of a scaled infrastructure that provides our business with a high degree of operating leverage.
Product: TPG AG Net Lease TPG AG Net Lease, with $2.0 billion in assets under management, focuses on single tenant commercial real estate, generally leased to non-investment grade tenants, largely acquired in simultaneous sale-leaseback transactions.
Product: TPG AG Net Lease TPG AG Net Lease, with $2.1 billion in assets under management as of December 31, 2024, focuses on single tenant commercial real estate, generally leased to non-investment grade tenants, largely acquired in simultaneous sale-leaseback transactions.
Real Estate, with $6.8 billion in assets under management, manages assets across various product sectors and has been active in many of the major U.S. real estate markets. TPG AG U.S.
Real Estate, with $6.1 billion in assets under management as of December 31, 2024, manages assets across various product sectors and has been active in many of the major U.S. real estate markets. TPG AG U.S.
The following table presents certain data about our Real Estate platform as of December 31, 2023 (dollars in billions): AUM Fee-earning AUM Active Funds Available Capital Investment Professionals $ 18 $ 11 4 $ 8 53 Product: TPG Real Estate Partners TPG Real Estate Partners (“TREP”), with $11.3 billion in assets under management, focuses on acquiring and building platforms rather than investing on a property-by-property basis, which we believe creates more efficient operating structures and ultimately results in scaled investments that may trade at premium entity-level pricing in excess of the net asset value of individual properties.
The following table presents certain data about our Real Estate platform as of December 31, 2024 (dollars in billions): AUM Fee-earning AUM Active Funds Available Capital Investment Professionals $ 18 $ 12 5 $ 6 53 Product: TPG Real Estate Partners TPG Real Estate Partners (“TREP”), with $11.1 billion in assets under management as of December 31, 2024, focuses on acquiring and building platforms, which we believe creates more efficient operating structures and ultimately results in scaled investments that may trade at premium entity-level pricing in excess of the net asset value of individual properties.
As of December 31, 2023, the TRTX loan investment portfolio consisted of 53 first mortgage loans (or interests therein) and total loan commitments of $3.7 billion. 10 Table of Contents Product: TPG Real Estate Credit Opportunities TPG Real Estate Credit Opportunities (TRECO) is our opportunistic, real estate credit strategy targeting risk-adjusted returns through investments primarily in real estate-related high-yield senior and subordinate loans and securities.
As of December 31, 2024, the TRTX loan investment portfolio consisted of 45 first mortgage loans (or interests therein) and total loan commitments of $3.4 billion. 10 Table of Contents TPG Real Estate Credit Opportunities TPG Real Estate Credit Opportunities (“TRECO”), which was established in 2023, is our opportunistic, real estate credit strategy targeting risk-adjusted returns through investments primarily in real estate-related high-yield senior and subordinate loans and securities.
In addition to our learning initiatives, we provide our employees access to e-learning resources that have been curated based on our analysis of performance review data. These curated learning paths align with our internal performance management competencies, including risk management, DEI and specific functional knowledge.
In addition to our learning initiatives, we provide our employees access to e-learning resources that have been curated based on our analysis of performance review data. These curated learning paths align with our internal performance management competencies.
Product: TPG AG Multi-Strategy TPG AG Multi-Strategy, with $2.0 billion in assets under management and 6 investment professionals as of December 31, 2023, invests across the breadth of TPG AG Credit, with a geographic focus in the United States and Western Europe.
Product: TPG AG Multi-Strategy TPG AG Multi-Strategy, with $2.3 billion in assets under management as of December 31, 2024, invests across the breadth of TPG AG Credit, with a geographic focus in the United States and Western Europe.
With an investment team of approximately 30 professionals and $3.0 billion in assets under management as of December 31, 2023, NewQuest is principally focused on complex secondary transactions. TPG GP Solutions Established in 2021, TGS was created to invest in high-quality private equity assets, which are principally based in North America and Europe, in partnership with third-party general partners.
With $3.2 billion in assets under management as of December 31, 2024, NewQuest is principally focused on complex secondary transactions. TPG GP Solutions Established in 2021, TGS was created to invest in high-quality, stable private equity assets, which are principally based in North America and Europe, in partnership with third-party general partners.
Specifically, TTAD aims to provide flexible capital for founders, employees and early investors looking for liquidity, as well as primary structured equity solutions for companies looking for additional, creative capital for growth. Product: TPG Digital Media TPG Digital Media, or “TDM”, is a flexible source of capital to pursue opportunities to invest in digital media.
Specifically, TTAD aims to provide flexible capital for founders, employees and early investors seeking liquidity, as well as primary structured equity solutions for companies looking for additional, creative capital for growth. Product: TPG Digital Media TPG Digital Media, or “TDM”, is a flexible source of capital focused on pursuing control equity investments in digital media.
In addition, large institutional investors and sovereign wealth funds have begun to develop their own in-house investment capabilities and may compete against us for investment opportunities. 20 Table of Contents Legal and Compliance Our legal and compliance team includes over 80 attorneys, compliance professionals and paralegals.
In addition, large institutional investors and sovereign wealth funds have begun to develop their own in-house investment capabilities and may compete against us for investment opportunities. Legal and Compliance Our legal and compliance team includes nearly 100 attorneys, compliance professionals and paralegals.
Item 1. Business Overview TPG is a leading global alternative asset manager with $221.6 billion in assets under management (“AUM”) as of December 31, 2023.
Item 1. Business Overview TPG is a leading global alternative asset manager with $245.9 billion in assets under management (“AUM”) as of December 31, 2024.
The firm hosts a wide range of volunteering opportunities, including serving meals at local shelters, mentoring local students, and building and coordinating delivery of care packages to U.S. troops. Additionally, we participate in corporate sponsorships and partnerships and offer a donation matching program. At a firm level, we have focused much of our civic engagement on our commitment to equality.
The firm hosts a wide range of volunteering opportunities, including serving meals at local shelters, mentoring local students, and building and coordinating delivery of care packages to U.S. troops. Additionally, we participate in corporate sponsorships and partnerships and offer a donation matching program.
The following table presents certain data about our TPG AG Real Estate platform as of December 31, 2023 (dollars in billions): AUM Fee-earning AUM Active Funds Available Capital Investment Professionals $ 18 $ 14 26 $ 7 85 Product: TPG AG U.S. Real Estate TPG AG U.S.
The following table presents certain data about our TPG AG Real Estate as of December 31, 2024 (dollars in billions): AUM Fee-earning AUM Active Funds Available Capital Investment Professionals $ 19 $ 14 30 $ 7 82 Product: TPG AG U.S. Real Estate TPG AG U.S.
The following table presents certain data about our Impact platform as of December 31, 2023 (dollars in billions): AUM Fee-earning AUM Active Funds Available Capital Investment Professionals $ 19 $ 14 6 $ 5 60 Product: The Rise Funds The Rise Funds are our dedicated vehicles for investing in companies that generate a demonstrable and significant positive societal impact alongside business performance and strong returns, with $8.7 billion in assets under management and 27 dedicated investment professionals as of December 31, 2023.
The following table presents certain data about our Impact platform as of December 31, 2024 (dollars in billions): AUM Fee-earning AUM Active Funds Available Capital Investment Professionals $ 27 $ 17 9 $ 10 74 Product: The Rise Funds The Rise Funds are our dedicated vehicles for investing globally in companies that generate a demonstrable and significant positive societal impact alongside business performance and strong returns, with $9.4 billion in assets under management as of December 31, 2024.
The following table presents certain data about our Growth platform as of December 31, 2023 (dollars in billions): AUM Fee-earning AUM Active Funds Available Capital Investment Professionals $ 27 $ 12 10 $ 5 47 Product: TPG Growth TPG Growth is our dedicated growth equity and middle market investing product, with $17.0 billion in assets under management and 47 dedicated investment professionals as of December 31, 2023.
The following table presents certain data about our Growth platform as of December 31, 2024 (dollars in billions): AUM Fee-earning AUM Active Funds Available Capital Investment Professionals $ 28 $ 12 9 $ 5 72 Product: TPG Growth TPG Growth is our dedicated growth equity and middle market investing product, with $18.1 billion in assets under management as of December 31, 2024.
The following table presents certain data about our TPG AG Credit platform as of December 31, 2023 (dollars in billions): AUM Fee-earning AUM Active Funds Available Capital Investment Professionals $ 60 $ 40 73 $ 7 141 Product: TPG AG Credit Solutions TPG AG Credit Solutions, with $12.9 billion in assets under management and 21 investment professionals as of December 31, 2023, invests in stressed, distressed and special situation corporate credit opportunities, primarily in North America and Europe, and can dynamically pivot between the public and private markets.
The following table presents certain data about our TPG AG Credit as of December 31, 2024 (dollars in billions): AUM Fee-earning AUM Active Funds Available Capital Investment Professionals $ 72 $ 43 80 $ 12 164 Product: TPG AG Credit Solutions TPG AG Credit Solutions, with $17.4 billion in assets under management as of December 31, 2024, invests in stressed, distressed and special situation corporate credit opportunities, primarily in North America and Europe, and can dynamically pivot between the public and private markets.
Real Estate is diversified across property sectors, with a thematic portfolio construction focused on rental residential, industrial, self-storage, life science, student housing and medical office, among other sectors. As of December 31, 2023, TPG AG U.S.
Real Estate is diversified across property sectors, with a thematic portfolio construction focused on rental residential, industrial, self-storage, life science, student housing and medical office, among other sectors.
Based on our investment strategy, we believe our impact investments can deliver profit and positive impact in tandem. Our Impact funds are organized in four primary products: (1) The Rise Funds, (2) TPG Rise Climate, (3) Evercare and (4) TPG NEXT.
Based on our investment strategy and performance track record, we have demonstrated that our impact investments can deliver profit and positive impact in tandem. Our Impact funds are organized in four primary products: (1) The Rise Funds, (2) TPG Rise Climate, (3) TPG Rise Climate Transition Infrastructure and (4) TPG NEXT.
As of December 31, 2023, we have approximately 1,850 full-time employees, including over 650 investment and operations professionals, over 970 non-investment and fundraising professionals, and more than 200 support staff, located in offices across Asia-Pacific, Europe, the Middle East, and North America.
As of December 31, 2024, we have over 1,900 full-time employees, comprised of approximately 670 investment and operations professionals, over 1,000 non-investment and fundraising professionals, and more than 230 support staff, located in offices across Asia-Pacific, Europe, the Middle East, and North America.
TPG AG Credit Solutions funds may also opportunistically invest in securities acquired at what the investment team believes are discounted prices relative to their intrinsic value and offer the potential for contractual income and/or price appreciation. TPG AG Credit Solutions invests through its Credit Solutions and Essential Housing closed-ended funds, as well as its Corporate Credit Opportunities open-ended fund.
TPG AG Credit Solutions funds may also opportunistically invest in securities acquired at what the investment team believes are discounted prices relative to their intrinsic value and offer the potential for contractual income and/or price appreciation.
TPG AG Real Estate products in the United States, Asia and Europe primarily focus on the acquisition of equity interests of underperforming and undervalued assets in the United States, Asia and Europe, where we employ our opportunistic and value-add strategies to improve performance. TPG AG Net Lease primarily invests in single tenant commercial real estate acquired in simultaneous sale-leaseback transactions.
Real Estate, (2) TPG AG Asia Real Estate, (3) TPG AG Europe Real Estate and (4) TPG AG Net Lease. TPG AG Real Estate products in the United States, Asia and Europe primarily focus on the acquisition of equity interests of underperforming and undervalued assets, where we can employ our opportunistic and value-add strategies to improve performance.
Our general partner capital commitments are funded with cash and not with performance allocations or deferral of management fees. In addition, certain qualified professionals are required and/or permitted, subject to certain restrictions, to invest in or alongside the funds we sponsor and manage. Fees assessed on such investments by our professionals may be eliminated or substantially reduced.
Our general partner capital commitments are funded with cash and not with performance allocations or deferral of management fees. In addition, certain qualified professionals are required and/or permitted, 18 Table of Contents subject to certain restrictions, to invest in or alongside the funds we sponsor and manage.
Our Growth platform provides us with a flexible mandate to capitalize on investment opportunities that are earlier in their life cycle, are smaller in size and/or have different profiles than would be considered for our Capital platform.
It provides us with a flexible mandate to invest in companies across our core sectors that are earlier in their life cycle, are smaller in size and/or have different profiles than would be considered for our Capital platform.
Management fees may also be offset by the investment advisers’ receipt of transaction, monitoring or other fees, as described in more detail under “Transaction, Monitoring and Other Fees” below. Management fees received are generally not subject to clawback. The investment adviser of our funds generally receives a management fee based on a percentage of the fund’s net asset value.
Management fees may also be offset by the investment advisers’ receipt of transaction, monitoring or other fees, as described in more detail under “Transaction, Monitoring and Other Fees” below. Management fees received are generally not subject to clawback.
The following table presents certain data about our Capital platform as of December 31, 2023 (dollars in billions): AUM Fee-earning AUM Active Funds Available Capital Investment Professionals $ 71 $ 39 10 $ 17 130 Product: TPG Capital TPG Capital is our North America and Europe-focused private equity investing business, with $41.8 billion in assets under management and 83 investment professionals around the world as of December 31, 2023.
The following table presents certain data about our Capital platform as of December 31, 2024 (dollars in billions): AUM Fee-earning AUM Active Funds Available Capital Investment Professionals $ 74 $ 37 10 $ 14 178 Product: TPG Capital TPG Capital is our North America and Europe-focused private equity investing business, with $43.5 billion in assets under management as of December 31, 2024.
Certain entities depicted below may be held through intervening entities not shown in the diagram. ___________ (1) GP LLC (as defined herein) is owned by entities owned by Messrs. Bonderman, Coulter and Winkelried. GP LLC owns the entity that serves as the general partner of the entity that holds 100% of the shares of Class B common stock outstanding.
Certain entities depicted below may be held through intervening entities not shown in the diagram. ___________ (1) GP LLC (as defined herein) owns the entities that serves as the general partners of the entities that hold 100% of the shares of Class B common stock outstanding.
Accordingly, we do not believe TPG Inc. is an inadvertent investment company by virtue of the 40% test in section 3(a)(1)(C). In addition, we believe TPG Inc. is not an investment company under section 3(b)(1) of the Investment Company Act because it is primarily engaged in a non-investment company business.
Accordingly, we do not believe TPG Inc. is an inadvertent investment company by virtue of the 40% test in section 3(a)(1)(C).
Our programs are designed to recruit, incentivize and retain top talent and to promote a culture of performance and meritocracy. We believe that our performance-based incentive compensation structure helps to ensure that our people’s interests align with the interests of our shareholders and other stakeholders, which include alignment with the firm’s financial performance and goals.
We believe that our performance-based incentive compensation structure helps to ensure that our people’s interests align with the interests of our shareholders and other stakeholders, which include alignment with the firm’s financial performance and goals.
We believe that the high margin profile of our business coupled with our consistent ability to deliver superior financing outcomes drives significant value to our portfolio companies and our stockholders.
We believe that the high margin profile of our business coupled with our consistent ability to deliver superior financing outcomes drives significant value to our portfolio companies and our stockholders. Organizational Structure The following diagram provides a simplified illustration of our organizational structure as of December 31, 2024.
We offer employee well-being programs designed to meet the needs of our diverse employee population, including access to mental health support through our medical plan, access to online meditation platforms and learning resources that teach methods to mitigate burn out, focus on self-care and increase productivity.
We offer employee well-being programs designed to meet the diverse needs of our employee population, including access to mental health support through our medical plan, access to online meditation platforms and learning resources that teach methods to mitigate burn out, focus on self-care and increase productivity. 14 Table of Contents Compensation and Benefits We believe that we provide a competitive compensation, benefits and total rewards framework to support the performance of the firm as a whole and each individual’s contributions to the firm.
Regulation as a Broker-Dealer TPG Capital BD, LLC (“TPG Capital BD”), one of our subsidiaries, is registered as a broker-dealer with the SEC under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and is subject to regulation and oversight by the SEC and is a member of the Financial Industry Regulatory Authority (“FINRA”) and is registered as a broker-dealer in all 50 states and the District of Columbia.
In addition, we believe TPG Inc. is not an investment company under section 3(b)(1) of the Investment Company Act because it is primarily engaged in a non-investment company business. 20 Table of Contents Regulation as a Broker-Dealer TPG Capital BD, LLC (“TPG Capital BD”), one of our subsidiaries, is registered as a broker-dealer with the SEC under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and is subject to regulation and oversight by the SEC and is a member of the Financial Industry Regulatory Authority (“FINRA”) and is registered as a broker-dealer in all 50 states and the District of Columbia.
None of TRTX, MITT or TCAP have redemption provisions or a requirement to return capital to investors upon exiting the investments made with such capital, except as required by applicable law (including distribution requirements that must be met to maintain real estate investment trust (“REIT”) or regulated investment company (“RIC”) status, as applicable). 18 Table of Contents Our funds are each generally advised by a TPG entity serving as investment adviser that is registered under the Investment Advisers Act of 1940, as amended (the “Advisers Act”).
None of TRTX, MITT or TCAP have redemption provisions or a requirement to return capital to investors upon exiting the investments made with such capital, except as required by applicable law (including distribution requirements that must be met to maintain real estate investment trust (“REIT”) or regulated investment company (“RIC”) status, as applicable).
Management fees are payable on a regular basis, typically quarterly or semi-annually, in the contractually prescribed amounts over the life of the fund. Depending on the base on which management fees are calculated, negative performance of one or more investments in a fund may reduce the total management fee paid for the relevant period, but not the fee rate.
Depending on the base on 17 Table of Contents which management fees are calculated, negative performance of one or more investments in a fund may reduce the total management fee paid for the relevant period, but not the fee rate.
TPEP is not siloed from our private investment businesses from an information perspective, which allows TPEP to collaborate with sector-focused teams across the rest of our firm and leverage TPG’s full intellectual capital and resources. TPEP currently manages a $2.1 billion long / short fund and a $1.9 billion long-only fund, both of which are managed with broad, opportunistic mandates.
TPEP is not siloed from our private investment businesses from an information perspective, which allows TPEP to collaborate with sector-focused teams across the rest of our firm and leverage TPG’s full intellectual capital and resources.
We believe that we have a distinctive business approach as compared to other alternative asset managers and a diversified, innovative array of investment platforms that position us well to continue generating sustainable growth across our business.
We believe our distinctive business approach and diversified array of innovative investment platforms position us well to continue generating highly profitable, sustainable growth.
In addition, where applicable, our investment professionals and portfolio operations teams work directly with our portfolio company senior executives to identify opportunities to drive operational efficiencies and growth.
In addition, where applicable, our investment professionals and portfolio operations teams work directly with our portfolio company senior executives to identify opportunities to drive operational efficiencies and growth. Our investment professionals are also responsible for making recommendations with respect to when and how to exit an investment to maximize value for our investors.
Website and Availability of SEC Filings We use our website (https://www.tpg.com), Rise website (https://therisefund.com), Microsites (https://software.tpg.com, https://healthcare.tpg.com), LinkedIn (https://www.linkedin.com/company/tpg-capital), Twitter (https://twitter.com/tpg), Vimeo (https://vimeo.com/user52190696), Rise YouTube (https://www.youtube.com/channel/UCo8p2iF_I5p-Wr2_MQlzedw/featured) and Rise Instagram (https://www.instagram.com/therisefund/?hl=en) accounts as channels of distribution of company information. The information we post through these channels may be deemed material.
Website and Availability of SEC Filings We use our website (https://www.tpg.com), Rise website (https://therisefund.com), TPG Angelo Gordon website (https://www.angelogordon.com), TPG Twin Brook website (https://twincp.com), TPG Twin Brook Capital Income Fund website (https://agtbcap.com), Microsites (https://software.tpg.com, https://healthcare.tpg.com), TPG LinkedIn (https://www.linkedin.com/company/tpg-capital), TPG Angelo Gordon LinkedIn (https://www.linkedin.com/company/tpg-angelo-gordon), TPG Twin Brook LinkedIn (https://www.linkedin.com/company/twin-brook-capital-partners), X (formerly known as Twitter) (https://x.com/tpg), Vimeo (https://vimeo.com/user52190696), TPG YouTube (https://www.youtube.com/@tpg-inc), Rise YouTube (https://www.youtube.com/channel/UCo8p2iF_I5p-Wr2_MQlzedw/featured), TPG Instagram (https://www.instagram.com/TPG_INCORPORATED) and Rise Instagram (https://www.instagram.com/therisefund/?hl=en) accounts as channels of distribution of company information.
We employ what we believe to be a differentiated, solutions-based approach that is capable of being executed in any market environment. TPG AG Credit Solutions seeks to align with companies, financial sponsors and business owners and to use its structuring skill and capital base to create bespoke, bilaterally-negotiated financing transactions that help resolve complex and idiosyncratic financial challenges.
TPG AG Credit Solutions seeks to align with companies, financial sponsors and business owners and to use its structuring skill and flexible capital base to create bespoke, bilaterally-negotiated financing transactions that help resolve complex and idiosyncratic financial challenges.
TGS brings a primary private equity approach to the general partner-led secondaries market that leverages the TGS team’s deep investing experience and the insights and expertise of the broader TPG ecosystem. Organizational Structure The following diagram provides a simplified illustration of our organizational structure as of December 31, 2023.
With $1.9 billion in assets under management as of December 31, 2024, TGS brings a primary private equity approach to the general partner-led secondaries market that leverages the TGS team’s deep investing experience and the insights and expertise of the broader TPG ecosystem.
Our investment professionals are also responsible for making recommendations with respect to when and how to exit an investment to maximize value for our investors. 17 Table of Contents Structure and Operation of Our Funds Structure and Management of Investment Vehicles We manage most of our funds and other similar private vehicles primarily by organizing a limited partnership or other limited liability entity to serve as the general partner of a limited partnership (a fund) organized by us to accept investors’ commitments.
Structure and Operation of Our Funds Structure and Management of Investment Vehicles We manage most of our funds primarily by organizing a limited partnership or other limited liability entity to serve as the general partner of a limited partnership (a fund) organized by us to accept investors’ commitments.
TPG AG Structured Credit & Specialty Finance invests through Mortgage Value Partners Fund, an open-ended hedge fund, the Asset Based Credit Fund, a closed-ended fund, separately managed accounts (“SMAs”) and AG Mortgage Investment Trust, Inc.
TPG AG Structured Credit & Specialty Finance invests through a variety of vehicles including the Mortgage Value Partners Fund open-ended hedge fund, the Asset Based Credit closed-ended fund series and evergreen vehicle, separately managed accounts (“SMAs”) and AG Mortgage Investment Trust, Inc. (NYSE: MITT) (“MITT”), which is an externally-managed, publicly traded residential mortgage real estate investment trust.
Through our capital markets activities, we generate underwriting, placement, arrangement, structuring and advisory fee revenue. In 2023, 2022 and 2021, our capital markets business drove $113.1 million, $117.4 million and $104.9 million in transaction revenue, respectively.
Through our capital markets activities, we generate underwriting, placement, arrangement, structuring and advisory fee revenue. During the years ended December 31, 2024 and 2023, our capital markets business drove $203.3 million and $113.1 million in transaction revenue, respectively.
Investment funds themselves typically do not register as investment companies under the Investment Company Act of 1940, as amended (the “Investment Company Act”), in reliance on Section 3(c) or Section 7(d) thereof.
For a discussion of the management fee to which our investment advisers are entitled, see “—Incentive Arrangements and Fee Structure” below. Investment funds themselves typically do not register as investment companies under the Investment Company Act of 1940, as amended (the “Investment Company Act”), in reliance on Section 3(c) or Section 7(d) thereof.
Our compliance policies and procedures address a variety of regulatory and compliance risks such as the handling of material non-public information, personal securities trading, anti-bribery, valuation of investments, document retention, potential conflicts of interest and the allocation of investment opportunities.
Our compliance policies and procedures address a variety of regulatory and compliance risks such as the handling of material non-public information, personal securities trading, anti-bribery, valuation of investments, document retention, potential conflicts of interest and the allocation of investment opportunities. 19 Table of Contents Although we have placed certain businesses behind permanent information barriers, we generally allow for information to flow freely among many of our other investment platforms.
Net realized income or loss is not netted between or among funds. 19 Table of Contents Performance allocations are subject to limited partner preferred returns or high watermarks, where applicable, and subject to a catch-up allocation to the general partner.
Performance allocations are subject to limited partner preferred returns or high watermarks, where applicable, and subject to a catch-up allocation to the general partner.
Violations of these requirements may result in public or private censures, fines, imposition of additional requirements, injunctions, restitution orders, revocation or modification of permissions or registrations, the suspension or expulsion of officers or employees from performing certain functions within the financial services industry, or other similar consequences.
Violations of these requirements may result in public or private censures, fines, imposition of additional requirements, injunctions, restitution orders, revocation or modification of permissions or registrations, the suspension or expulsion of officers or employees from performing certain functions within the financial services industry, or other similar consequences. 21 Table of Contents Other Jurisdictions Certain other subsidiaries or funds that we advise are registered with, have been licensed by or have obtained authorizations to operate in their respective jurisdictions outside of the United States.
Certain funds may make distributions to the general partner to provide the general partner with cash sufficient to pay applicable federal, state and local tax liabilities to the extent distributions from such funds for the relevant year were otherwise insufficient to cover such tax liabilities.
Certain funds may make distributions to the general partner to provide the general partner with cash sufficient to pay applicable federal, state and local tax liabilities to the extent distributions from such funds for the relevant year were otherwise insufficient to cover such tax liabilities. 16 Table of Contents Our private investment funds typically have a term of six to ten years or more, subject to the potential for extensions with investor consent.
Product: TPG AG Middle Market Direct Lending TPG AG Middle Market Direct Lending, Twin Brook Capital Partners, focuses on sourcing, underwriting and actively managing a diversified portfolio of middle market, floating rate, senior secured loans, including revolvers, first lien debt and, opportunistically, second lien debt.
Product: TPG AG Middle Market Direct Lending TPG AG Middle Market Direct Lending (“MMDL”) and TPG Twin Brook Capital Partners focus on sourcing, underwriting and actively managing a diversified portfolio of lower middle market, senior secured loans, including revolvers and first lien debt, and seek to deliver stable and attractive returns while minimizing volatility and protecting the downside.
TPG AG Middle Market Direct Lending includes the MMDL closed-ended fund series, as well as a public, non-traded business development company (“BDC”), AG Twin Brook Capital Income Fund 8 Table of Contents (“TCAP”). As of December 31, 2023, TPG AG Middle Market Direct Lending had $20.6 billion in assets under management and 70 investment professionals.
TPG AG Middle Market Direct Lending includes the MMDL closed-ended fund series and evergreen vehicle and SMAs, as well as a public, non-traded business development company (“BDC”), TPG Twin Brook Capital Income Fund (“TCAP”).
Product: TPG AG Asia Real Estate TPG AG Asia Real Estate, with $5.3 billion in assets under management, manages assets across Asia, with investments primarily in Japan, South Korea, Hong Kong, China and Singapore. TPG AG Asia Real Estate focuses on capitalizing on opportunistic investments, primarily created through lack of real estate expertise, illiquidity or distress in many Asian markets.
Product: TPG AG Asia Real Estate TPG AG Asia Real Estate, with $5.5 billion in assets under management as of December 31, 2024, manages assets across Asia, with investments primarily in Japan, South Korea, Hong Kong, China and Singapore.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe SEC has also recently adopted amendments to the existing custody rule, which would, among other changes, expand the scope of assets that are subject to the rule, new rules prohibiting registered advisers from outsourcing certain services without first meeting minimum requirements, and new rules to address certain conflicts of interest associated with the use of predictive data analytics, such as artificial intelligence and machine learning with, if adopted, would require advisers to, among other things, eliminate or neutralize the effect of conflicts of interest associated with the adviser’s use of these technologies.
Biggest changeSee “—Failure to maintain the security of our information and technology networks or data security breaches could harm our reputation and have a material adverse effect on our results of operations, financial condition and cash flow.” • Rules proposed in February 2022 that would, if adopted, require investment advisers to, among other things, adopt cybersecurity policies and procedures reasonably designed to address cybersecurity risks, develop cybersecurity monitoring and protections and disclose certain information about cybersecurity risks and incidents. • The SEC adopted an expansion of the reporting obligations under Form PF and changes to the beneficial ownership reporting regime applicable to positions in public companies, which are expected to increase investment advisers’ data-gathering and disclosure obligations. • The SEC has also recently proposed amendments to the existing Advisers Act custody rule that would, if adopted, among other changes, expand the scope of assets that are subject to the rule and require investment advisers to enter into contracts with qualified custodians. • The SEC has also proposed new rules prohibiting registered investment advisers from outsourcing certain services without first meeting minimum requirements and addressing certain conflicts of interest associated with the use of predictive data analytics, such as AI and machine learning with AI. 77 Table of Contents These newly adopted or proposed rules are expected to increase compliance burdens and associated regulatory costs and complexity and impose limitations on our investing activities.
In limited circumstances, we erect temporary information barriers to restrict the transfer of non-public information, which limit our funds’ abilities to benefit from TPG expertise and could be breached, resulting in the same restrictions on their investment activities.
In limited circumstances, we erect temporary information barriers to restrict the transfer of non-public information, which limit our funds’ abilities to benefit from TPG expertise and could be breached, resulting in the same restrictions on their investment activities. Information barriers .
Since the amount of performance allocations allocable to the general partners of our funds depends on the funds’ performance, we have an incentive to recommend and, as the general partner, cause our funds to make more speculative investments than they would otherwise make in the absence of such performance-based allocation.
Since the amount of performance allocations allocable to our funds’ general partners depends on the funds’ performance, we have an incentive to recommend and, as the general partner, cause our funds to make more speculative investments than they would otherwise make in the absence of such performance-based allocation.
Consequently, conflicts of interest may arise in connection with investment decisions, including regarding the identification, making, management, disposition and, in each case, timing of a fund’s investments, and we may not realize the most tax efficient treatment of our performance allocations generated by all of our funds going forward.
Consequently, conflicts of interest arise in connection with investment decisions, including regarding the identification, making, management, disposition and, in each case, timing of a fund’s investments, and we may not realize the most tax efficient treatment of our performance allocations generated by all of our funds going forward.
REITs may be affected by changes in the value of their underlying properties and defaults by borrowers or tenants, and changes in tax laws or by a failure to qualify for tax-free pass through income could impair a REIT’s ability to generate cash flows to make distributions.
REITs may be affected by changes in the value of their underlying properties and defaults by borrowers or tenants, and changes in tax laws or a failure to qualify for tax-free pass through income could impair a REIT’s ability to generate cash flows to make distributions.
Our public equity platform, TPEP, invests in the public equity markets and is subject to numerous additional risks, including the following: • Certain public equity funds may engage in short selling, which is subject to theoretically unlimited loss, in that the price of the underlying security could theoretically increase without limit, thus increasing the cost of buying those securities to cover the short position.
Our public equity platform, TPEP, invests in the public equity markets and is subject to numerous additional risks, including the following: • Certain public equity funds may engage in short selling, which is theoretically subject to unlimited loss, in that the price of the underlying security could theoretically increase without limit, thus increasing the cost of buying those securities to cover the short position.
In such event, the funds might only be able to build some but not all of the position, or if the overall position were to need adjustment, the funds might not be able to make such adjustment.
In such event, the funds might only be able to build some but not all of the position, or if the overall position were to need adjustment, the funds might not be able to make the adjustment.
Accordingly, our consolidated statements of operations for the year ended December 31, 2023 do not reflect what the combined company’s actual results of operations would have been had the Acquisition been completed on January 1, 2023.
Accordingly, our consolidated statements of operations for the year ended December 31, 2023 do not reflect what our combined company’s actual results of operations would have been had the Acquisition been completed on January 1, 2023.
These assumptions may not prove to be accurate and other factors may affect our combined company’s financial condition or results of operations moving forward. Accordingly, the Company’s financial condition and results of operations in the future may not be evident from or consistent with such pro forma financial information.
These assumptions may not prove to be accurate and other factors may affect our combined company’s financial condition or results of operations moving forward. Accordingly, our financial condition and results of operations in the future may not be evident from or consistent with such pro forma financial information.
Our current intention is to pay holders of our Class A common stock and nonvoting Class A common stock a quarterly dividend representing at least 85% of TPG Inc.’s share of DE attributable to the TPG Operating Group, subject to adjustment as determined by the Executive Committee of our board of directors to be necessary or appropriate to provide for the conduct of our business, to make appropriate investments in our business and funds, to comply with applicable law, any of our debt instruments or other agreements, or to provide for future cash requirements such as tax-related payments and clawback obligations.
Our current intention is to pay holders of our Class A common stock and nonvoting Class A common stock a quarterly dividend representing at least 85% of TPG Inc.’s share of DE attributable to the TPG Operating Group, subject to adjustment as determined by the Executive Committee or our board of directors to be necessary or appropriate to provide for the conduct of our business, to make appropriate investments in our business and funds, to comply with applicable law, any of our debt instruments or other agreements, or to provide for future cash requirements such as tax-related payments and clawback obligations.
Although we expect to pay at least 85% of our DE as a dividend, the percentage of our DE paid out as a dividend could fall below that target minimum.
Although we expect to pay at least 85% of our DE as a dividend, the percentage of our DE paid out as a dividend could fall below that target minimum.
We cannot predict the timing, size, or disclosure of any future issuances of our Class A common stock resulting from the exchange of Common Units or the effect, if any, that future issuances, disclosure, if any, or sales of shares of our Class A common stock may have on the market price of our Class A common stock.
We cannot predict the timing, size or disclosure of any future issuances of our Class A common stock resulting from the exchange of Common Units or the effect, if any, that future issuances, disclosure or sales of shares of our Class A common stock may have on the market price of our Class A common stock.
For example, bipartisan legislation enacted in August 2018 has increased and may continue to significantly increase the number of transactions that are subject to the jurisdiction of the Committee on Foreign Investment in the United States (the “CFIUS”), which has the authority to review and potentially block or impose conditions on certain foreign investments in U.S. companies or real estate.
For example, bipartisan legislation enacted in August 2018 has increased and may continue to significantly increase the number of transactions that are subject to the jurisdiction of the Committee on Foreign Investment in the United States (“CFIUS”), which has the authority to review and potentially block or impose conditions on certain foreign investments in U.S. companies or real estate.
Treasury Department’s Office of Foreign Assets Control (“OFAC”)) and the potential for the imposition of new or additional tariffs; • political hostility to investments by foreign or private equity investors, including increased risk of government expropriation; • reliance on a more limited number of commodity inputs, service providers and distribution mechanisms; • higher rates of inflation; • higher transaction costs; • less government supervision of exchanges, brokers and issuers; 38 Table of Contents • less developed or non-uniform bankruptcy, limited liability company, corporate, partnership and other laws (which may have the effect of disregarding or otherwise circumventing limited liability structures, potentially causing the actions or liabilities of one fund or portfolio company to adversely impact us or an unrelated fund or portfolio company); • difficulty in enforcing contractual obligations; • less stringent requirements relating to fiduciary duties; • fewer investor protections and less publicly available information about a company; • limitations on borrowings to be used to fund acquisitions or dividends; • potential limitations on the deductibility of interest for income tax purposes; • limitations on permissible transaction counterparties or consolidation rules that effectively restrict the types of businesses in which we may invest; • economic and political risks, including potential exchange control regulations, restrictions on repatriation of profits on investments or of capital invested, nationalization, expropriation of assets, confiscatory taxation and political, economic or social instability; and • the imposition of non-U.S. taxes or withholding on income and gains recognized with respect to such securities and potential non-U.S. tax filing requirements.
Treasury Department’s Office of Foreign Assets Control (“OFAC”)) and the potential for the imposition of new or additional tariffs; • political hostility to investments by foreign or private equity investors, including increased risk of government expropriation; • reliance on a more limited number of commodity inputs, service providers and distribution mechanisms; • higher rates of inflation; • higher transaction costs; • less government supervision of exchanges, brokers and issuers; 37 Table of Contents • less developed or non-uniform bankruptcy, limited liability company, corporate, partnership and other laws (which may have the effect of disregarding or otherwise circumventing limited liability structures, potentially causing the actions or liabilities of one fund or portfolio company to adversely impact us or an unrelated fund or portfolio company); • difficulty in enforcing contractual obligations; • less stringent requirements relating to fiduciary duties; • fewer investor protections and less publicly available information about a company; • limitations on borrowings to be used to fund acquisitions or dividends; • potential limitations on the deductibility of interest for income tax purposes; • limitations on permissible transaction counterparties or consolidation rules that effectively restrict the types of businesses in which we may invest; • economic and political risks, including potential exchange control regulations, restrictions on repatriation of profits on investments or of capital invested, nationalization, expropriation of assets, confiscatory taxation and political, economic or social instability; and • the imposition of non-U.S. taxes or withholding on income and gains recognized with respect to such securities and potential non-U.S. tax filing requirements.
Under these rules, a listed company of which more than 50% of the voting power is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain corporate governance requirements, including the requirement that (i) a majority of our board of directors consist of independent directors, (ii) director nominees be selected or recommended to the board by independent directors or an independent nominating committee and (iii) we have a compensation committee that is composed entirely of independent directors.
Under these rules, a listed company of which more than 50% of the voting power is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain corporate governance requirements, including that (i) a majority of our board of directors consist of independent directors, (ii) director nominees be selected or recommended to the board by independent directors or an independent nominating committee and (iii) we have a compensation committee that is composed entirely of independent directors.
Other potential changes in legislation or regulation may include higher corporate tax rate, greater scrutiny on the private equity industry or elimination of carried interest or limitations of the capital gains tax. If the proposed bills or parts thereof, or other similar legislation, were to become law, it could negatively impact affect us, our funds’ portfolio companies and our investors.
Other potential changes in legislation or regulation may include higher corporate tax rate, greater scrutiny on the private equity industry or elimination of carried interest or limitations of the capital gains tax. If the proposed bills or parts thereof, or other similar legislation, were to become law, it could negatively impact us, our funds’ portfolio companies and our investors.
For example, the United States denied the “most-favored nation” tariff treatment on products from Russia and Belarus and prohibited the importation of oil, gas and coal from Russia. These new tariffs, or other changes in U.S. trade policy, have resulted in, and may continue to trigger, retaliatory actions by affected countries, particularly China.
For example, the United States denied the “most-favored nation” tariff treatment on products from Russia and Belarus and prohibited the importation of oil, gas and coal from Russia. These tariffs, or other changes in U.S. trade policy, have resulted in, and may continue to trigger, retaliatory actions by affected countries, particularly China.
There can be no assurance that these agreements will not expire or be terminated or not be renewed. Any such termination, expiration or non-renewal could have a material adverse effect on our business, results of operations, financial condition and prospects. Funds associated with our secondaries investment products are subject to additional risks.
There can be no assurance that these agreements will not expire or be terminated or not be renewed. Any such termination, expiration or non-renewal could have a material adverse effect on our business, results of operations and financial condition. Funds associated with our secondaries investment products are subject to additional risks.
See“—Risks Related to Our Industry—Changes in relevant tax laws, regulations or treaties or an adverse interpretation of these items by tax authorities could negatively impact our effective tax rate and tax liability.” If our funds are unable to obtain committed debt financing for potential acquisitions, can only obtain debt financing at an increased interest rate or on unfavorable terms or the ability to deduct corporate interest expense is substantially limited, our funds may face increased competition from strategic buyers of assets who may have an overall lower cost of capital or the ability to benefit from a higher amount of cost savings following an acquisition, or may have difficulty completing otherwise profitable acquisitions or may generate profits that are lower than would otherwise be the case, each of which could lead to a decrease in our revenues.
See “—Risks Related to Our Industry—Changes in relevant tax laws, regulations or treaties or an adverse interpretation of these items by tax authorities could negatively impact our effective tax rate and tax liability.” If our funds are unable to obtain committed debt financing for potential acquisitions, can only obtain debt financing at an increased interest rate or on unfavorable terms or the ability to deduct corporate interest expense is substantially limited, our funds may face increased competition from strategic buyers of assets who may have an overall lower cost of capital or the ability to benefit from a higher amount of cost savings following an acquisition, or may have difficulty completing otherwise profitable acquisitions or may generate profits that are lower than would otherwise be the case, each of which could lead to a decrease in our revenues.
Entry into certain lines of business may subject us to new laws and regulations with which we are not familiar, or from which we are currently exempt, and may lead to increased litigation and regulatory risk and expense. New products or strategies could have different economic structures than our traditional funds and may require a different marketing approach.
Entry into certain lines of business may also subject us to new laws and regulations with which we are not familiar, or from which we are currently exempt, and may lead to increased litigation and regulatory risk and expense. New products or strategies could have different economic structures than our traditional funds and may require a different marketing approach.
Between the first and second anniversary of the Closing, the API Feeder Partnerships and API partners may transfer or exchange up to 33.33% of their Class A common stock, Class B common stock or any Common Units directly or indirectly owned as of the Closing, as applicable; between the second and third anniversary of the closing, the API Feeder Partnerships and API partners may transfer or exchange up to 66.66% of their Class A common stock, Class B common stock or any Common Units directly or indirectly owned as of the Closing, as applicable; and after the third anniversary of the Closing, the API Feeder Partnerships and API partners may transfer or exchange up to 100% of their Class A common stock, Class B common stock or any Common Units, as applicable (in each case, with respect to Common Units, subject to the terms of the A&R Exchange Agreement).
Between the Closing’s first and second anniversary, the API Feeder Partnerships and API partners may transfer or exchange up to 33.33% of their Class A common stock, Class B common stock or any Common Units directly or indirectly owned as of the Closing, as applicable; between the Closing’s second and third anniversary, the API Feeder Partnerships and API partners may transfer or exchange up to 66.66% of their Class A common stock, Class B common stock or any Common Units directly or indirectly owned as of the Closing, as applicable; and after the Closing’s third anniversary, the API Feeder Partnerships and API partners may transfer or exchange up to 100% of their Class A common stock, Class B common stock or any Common Units, as applicable (in each case, with respect to Common Units, subject to the terms of the A&R Exchange Agreement).
The success of our growth strategy depends on, among other things: • our ability to correctly identify and create products that appeal to investors; • how our existing fund investors view any new initiatives; • mitigating risks that arise from the diversion of management’s time and attention from our existing businesses; 29 Table of Contents • our ability to properly manage conflicts of interests with our existing businesses; • minimizing any disruption to our ongoing businesses; • management’s ability to develop and integrate new businesses and the success of integration efforts; • our ability to identify and manage risks in new lines of businesses; • our ability to successfully negotiate and enter into beneficial arrangements with new counterparties; • our ability to implement adequate investment processes, controls and procedures that we have already developed around our existing platforms and/or identify and develop new policies, controls and procedures appropriate in light of a new business, product or investment strategy; • our ability to successfully enter into markets or businesses in which we may have limited or no experience; • managing the increased demands on our information systems, operational systems and technology, including related security systems, and infrastructure; • our ability to achieve expected results or realize expected synergies from newly developed products or strategic alliances; • our ability to obtain requisite approvals and licenses from relevant governmental authorities and to comply with applicable laws and regulations without incurring undue costs or delays; and • the broadening of our geographic footprint and successfully managing the risks associated with conducting operations in foreign jurisdictions (including regulatory, tax, legal and reputational consequences).
The success of our growth strategy depends on, among other things: • our ability to correctly identify and create products that appeal to investors; • how our existing fund investors view any new initiatives; • mitigating risks that arise from the diversion of management’s time and attention from our existing businesses; • our ability to properly manage conflicts of interests with our existing businesses; • minimizing any disruption to our ongoing businesses; • management’s ability to develop and integrate new businesses and the success of integration efforts; • our ability to identify and manage risks in new lines of businesses and new types of investors; • our ability to successfully negotiate and enter into beneficial arrangements with new counterparties; • our ability to implement adequate investment processes, controls and procedures that we have already developed around our existing platforms and/or identify and develop new policies, controls and procedures appropriate in light of a new business, product or investment strategy; • our ability to successfully enter into markets or businesses in which we may have limited or no experience; • managing the increased demands on our information systems, operational systems and technology, including related security systems, and infrastructure; • our ability to achieve expected results or realize expected synergies from newly developed products or strategic alliances; • our ability to obtain requisite approvals and licenses from relevant governmental authorities and to comply with applicable laws and regulations without incurring undue costs or delays; and 28 Table of Contents • the broadening of our geographic footprint and successfully managing the risks associated with conducting operations in foreign jurisdictions (including regulatory, tax, legal and reputational consequences).
Increased regulatory focus on the alternative asset industry or legislative or regulatory changes could result in additional burdens and expenses on our business.” The risk of reputational harm is elevated by the prevalence of internet and social media usage and the increased public focus on behaviors and externalities of business activities, including those affecting stakeholder interests and ESG considerations.
Increased regulatory focus on the alternative asset industry or legislative or regulatory changes could result in additional burdens and expenses on our business.” The risk of reputational harm is elevated by the prevalence of internet and social media usage and the increased public focus on behaviors and externalities of business activities, including those affecting stakeholder interests and ESG and DEI considerations.
We believe that future volatility in general market conditions would affect both of our funds’ performance and our financial performance. Our performance in prior years benefited from high multiples and asset prices. A decline in multiples or asset prices, or an overall deterioration in market conditions, could make it more difficult to earn such returns on new investments.
We believe that future volatility in general market conditions would affect both our funds’ performance and our financial performance. Our performance in prior years benefited from high multiples and asset prices. A decline in multiples or asset prices, or an overall deterioration in market conditions, could make it more difficult to earn such returns on new investments.
Furthermore, the incurrence of a significant amount of indebtedness by an investment could, among other things: • subject the entity to a number of affirmative, negative and financial covenants, terms and conditions, any violation of which would be viewed by creditors as an event of default and could materially impact our ability to realize value from the investment; • give rise to an obligation to make mandatory prepayments of debt using excess cash flow, which might limit the entity’s ability to respond to changing industry conditions to the extent additional cash is needed for the response, to make unplanned but necessary capital expenditures or to take advantage of growth opportunities; • allow even moderate reductions in operating cash flow to render the entity unable to service its indebtedness, leading to a bankruptcy or other reorganization of the entity and a loss of part or all of the equity investment in it; • limit the entity’s ability to adjust to changing market conditions, thereby placing it at a competitive disadvantage compared to its competitors who have relatively less debt; • limit the entity’s ability to engage in strategic acquisitions that might be necessary to generate attractive returns or further growth; and • limit the entity’s ability to obtain additional financing or increase the cost of obtaining such financing, including for capital expenditures, working capital or other general corporate purposes.
Furthermore, the incurrence of a significant amount of indebtedness by an investment could, among other things: • subject the entity to a number of affirmative, negative and financial covenants, terms and conditions, any violation of which would be viewed by creditors as an event of default and could materially impact our ability to realize value from the investment; 70 Table of Contents • give rise to an obligation to make mandatory prepayments of debt using excess cash flow, which might limit the entity’s ability to respond to changing industry conditions to the extent additional cash is needed for the response, to make unplanned but necessary capital expenditures or to take advantage of growth opportunities; • allow even moderate reductions in operating cash flow to render the entity unable to service its indebtedness, leading to a bankruptcy or other reorganization of the entity and a loss of part or all of the equity investment in it; • limit the entity’s ability to adjust to changing market conditions, thereby placing it at a competitive disadvantage compared to its competitors who have relatively less debt; • limit the entity’s ability to engage in strategic acquisitions that might be necessary to generate attractive returns or further growth; and • limit the entity’s ability to obtain additional financing or increase the cost of obtaining such financing, including for capital expenditures, working capital or other general corporate purposes.
Managers of certain pooled investment vehicles with exposure to certain types of derivatives may be required to register with the CFTC as commodity pool operators and/or commodity trading advisors and become members of the National Futures Association. As such, certain of our or our affiliates’ risk management or other commodities interest-related activities may be subject to CFTC oversight.
Managers of certain pooled investment vehicles with exposure to certain types of derivatives may be required to register with the CFTC as commodity pool operators and/or commodity trading advisors and become members of the National Futures Association (the “NFA”). As such, certain of our or our affiliates’ risk management or other commodities interest-related activities may be subject to CFTC oversight.
See “—Our funds invest in companies that are based outside of the United States, which may expose us to additional risks not typically associated with investing in companies that are based in the United States” and “—Risks Related to Taxation—Changes in relevant tax laws, regulations or treaties or an adverse interpretation of these items by tax authorities could negatively impact our effective tax rate and tax liability.” The failure of our funds to raise capital in sufficient amounts and on satisfactory terms could decrease our AUM and revenue and have a material adverse effect on our results of operations, financial condition and cash flow. 26 Table of Contents A decline in the pace or size of investments by our funds could result in our receiving less revenue from fees.
See “—Our funds invest in companies that are based outside of the United States, which may expose us to additional risks not typically associated with investing in companies that are based in the United States” and “—Risks Related to Taxation—Changes in relevant tax laws, regulations or treaties or an adverse interpretation of these items by tax authorities could negatively impact our effective tax rate and tax liability.” The failure of our funds to raise capital in sufficient amounts and on satisfactory terms could decrease our AUM and revenue and have a material adverse effect on our results of operations, financial condition and cash flow. 25 Table of Contents A decline in the pace or size of investments by our funds could result in our receiving less revenue from fees.
The Chinese government maintains a major role in setting economic policy, often making sudden changes to laws and regulations, including through the issuance of guidance or enforcement, possibly with retroactive effect. For example, in 2021, the Chinese government has changed policies regulating certain industries, including the education and technology sectors.
The Chinese government maintains a major role in setting economic policy, often making sudden changes to laws and regulations, including through the issuance of guidance or enforcement, possibly with retroactive effect. For example, in 2021, the Chinese government changed policies regulating certain industries, including the education and technology sectors.
The FCPA prohibits bribery of foreign public officials, government employees and political parties and requires public companies in the United States to keep books and records that accurately and fairly reflect their transactions. The U.S. Department of Commerce and the U.S. Department of State administer and enforce certain export control laws and regulations, and OFAC and the U.S.
The FCPA prohibits bribery of foreign public officials, government employees and political parties and requires public companies in the United States to keep books and records that accurately and fairly reflect their transactions. In addition, the U.S. Department of Commerce and the U.S. Department of State administer and enforce certain export control laws and regulations, and OFAC and the U.S.
A variety of factors could exacerbate the competitive risks we face, including: • fund investors may reduce their investments in our funds or decrease their allocations in new funds based on a variety of factors, such as the occurrence of an economic downturn, their available capital, regulatory requirements or a desire to consolidate their relationships with investment firms; 74 Table of Contents • some of our competitors may have agreed, or may agree, to terms on their funds or products that are more favorable to fund investors than those of our funds or products, such as lower management fees, greater fee sharing or higher hurdles for performance allocations, and we may be unable to match or otherwise revise our terms; • some of our funds may not perform as well as competitors’ funds or other available investment products; • some of our competitors may have raised, or may raise, significant amounts of capital and may have similar investment objectives and strategies to our funds, which could create additional competition for investment opportunities and reduce the size and duration of pricing inefficiencies that many alternative investment strategies seek to exploit; • some of our competitors may have a lower cost of capital and access to funding sources that are not available to us; • some of our competitors may have higher risk tolerances, different risk assessments or lower return thresholds, which could allow them to consider a wider variety of investments and bid more aggressively than us for investments; • some of our competitors may be subject to less regulation or less regulatory scrutiny and, accordingly, may have more flexibility to undertake and execute certain businesses or investments than we do and/or bear less expense to comply with such regulations than we bear; • there are relatively few barriers to entry impeding the formation of new funds, including a relatively low cost of entering these businesses, and the successful efforts of new entrants into our various lines of business have resulted, and may continue to result, in increased competition; • if, as we expect, allocation of assets to alternative investment strategies increases, there may be increased competition for alternative investments and access to fund general partners and managers; • some of our competitors may have instituted, or may institute, low cost, high speed financial applications and services based on artificial intelligence, and new competitors may enter the investment management space using new investment platforms based on artificial intelligence; • some investors may prefer to pursue investments directly instead of investing through one of our funds; • some investors may prefer to invest with an investment manager that is not publicly traded, is smaller or manages fewer investment products; and • other industry participants continuously seek to recruit our investment professionals and other key personnel away from us.
A variety of factors could exacerbate the competitive risks we face, including: • fund investors may reduce their investments in our funds or decrease their allocations in new funds based on a variety of factors, such as the occurrence of an economic downturn, their available capital, regulatory requirements or a desire to consolidate their relationships with investment firms; • some of our competitors may have agreed, or may agree, to terms on their funds or products that are more favorable to fund investors than those of our funds or products, such as lower management fees, greater fee sharing or higher hurdles for performance allocations, and we may be unable to match or otherwise revise our terms; • some of our funds may not perform as well as competitors’ funds or other available investment products; • some of our competitors may have raised, or may raise, significant amounts of capital and may have similar investment objectives and strategies to our funds, which could create additional competition for investment opportunities and reduce the size and duration of pricing inefficiencies that many alternative investment strategies seek to exploit; • some of our competitors may have a lower cost of capital and access to funding sources that are not available to us; • some of our competitors may have higher risk tolerances, different risk assessments or lower return thresholds, which could allow them to consider a wider variety of investments and bid more aggressively than us for investments; • some of our competitors may be subject to less regulation or less regulatory scrutiny and, accordingly, may have more flexibility to undertake and execute certain businesses or investments than we do and/or bear less expense to comply with such regulations than we bear; • there are relatively few barriers to entry impeding the formation of new funds, including a relatively low cost of entering these businesses, and the successful efforts of new entrants into our various lines of business have resulted, and may continue to result, in increased competition; • if, as we expect, allocation of assets to alternative investment strategies increases, there may be increased competition for alternative investments and access to fund general partners and managers; • some of our competitors may have instituted, or may institute, low cost, high speed financial applications and services based on AI, and new competitors may enter the investment management space using new investment platforms based on AI; • some investors may prefer to pursue investments directly instead of investing through one of our funds; 73 Table of Contents • some investors may prefer to invest with an investment manager that is not publicly traded, is smaller or manages fewer investment products; and • other industry participants continuously seek to recruit our investment professionals and other key personnel away from us.
TPG Capital BD’s capital market activities subject us to potential liability for, among other things, material misstatements or omissions in prospectuses and other offering documents in the United States and elsewhere, and for failure to provide certain disclosure documents or marketing securities to certain types of investors in the EU and the U.K.
TPG Capital BD’s capital market activities also subject us to potential liability for, among other things, material misstatements or omissions in prospectuses and other offering documents in the United States and elsewhere, and for failure to provide certain disclosure documents or marketing securities to certain types of investors in the EU and the U.K.
In addition, for those financial products that have a sustainable investment objective or which promote environmental or social characteristics, there is an obligation to disclose such an objective or characteristics in pre-contractual disclosures and report on an ongoing basis their performance in achieving those commitments, among other requirements.
In addition, for those financial products that have a sustainable investment objective or promote environmental or social characteristics, there is an obligation to disclose such an objective or characteristics in pre-contractual disclosures and report on an ongoing basis their performance in achieving those commitments, among other requirements.
In general, we have an incentive to retain, or to exercise our control or influence over a portfolio company’s management team so that it retains, TPG Capital BD (or a related entity) or otherwise transacts with TPG Capital BD instead of other unaffiliated broker-dealers or counterparties.
In general, we have an incentive to retain, or to exercise our control or influence over a portfolio company’s management team or other participant so that it retains, TPG Capital BD (or a related entity) or otherwise transacts with TPG Capital BD instead of other unaffiliated broker-dealers or counterparties.
We may be unable to enter into new facilities or issue debt or equity securities in the future on attractive terms, or at all. Furthermore, the existing credit agreements and instruments governing our debt contain covenants with which we need to comply.
We may be unable to enter into new facilities or issue debt or equity securities in the future on attractive terms, or at all. Furthermore, the credit agreements, indentures and instruments governing our existing debt contain covenants with which we need to comply.
Under the terms of the limited partnership agreement of the TPG Operating Group (the “Limited Partnership Agreement”), the TPG Operating Group partnership is generally obligated to make tax distributions to holders of Common Units (including us) at certain assumed tax rates for taxable periods (or portions thereof).
Under the terms of the TPG Operating Group’s limited partnership agreement (the “Limited Partnership Agreement”), the TPG Operating Group partnership is generally obligated to make tax distributions to holders of Common Units (including us) at certain assumed tax rates for taxable periods (or portions thereof).
Intervention by the Chinese government with respect to VIEs, including disallowing the structure altogether (as the media has reported, with the China Securities Regulatory Commission issuing a contradicting statement), could significantly affect the Chinese operating company’s performance and the enforceability of the VIE’s contractual arrangements with the Chinese company and result in a decline in the value of our funds’ investment. 40 Table of Contents Further, unlike in many other jurisdictions, the Chinese judiciary is not independent and may not be able to provide effective legal redress challenging Chinese authorities’ policy changes.
Intervention by the Chinese government with respect to VIEs, including disallowing the structure altogether (as the media has reported, with the China Securities Regulatory Commission issuing a contradicting statement), could significantly affect the Chinese operating company’s performance and the enforceability of the VIE’s contractual arrangements with the Chinese company and result in a decline in the value of our funds’ investment. 39 Table of Contents Further, unlike in many other jurisdictions, the Chinese judiciary is not independent and may not be able to provide effective legal redress challenging Chinese authorities’ policy changes.
There is no guarantee that such financial institutions will continue to extend credit to us or will renew the existing credit agreements we have with them, or that we will be able to refinance our outstanding notes or other obligations when they mature.
There is no guarantee that financial institutions will continue to extend credit to us or will renew the existing credit agreements we have with them, or that we will be able to refinance our outstanding notes or other obligations when they mature.
We completed our acquisition of Angelo Gordon on November 1, 2023 and, as a result, the results of TPG Angelo Gordon included in our consolidated statements of operations are only from November 1, 2023 to December 31, 2023.
We completed our acquisition of Angelo Gordon on November 1, 2023 and, as a result, the results of TPG Angelo Gordon included in our consolidated statements of operations are only from November 1, 2023 to December 31, 2024.
The declaration and payment by us of any future dividends to holders of our Class A common stock is at the sole discretion of our Executive Committee until the Sunset, and then by the board of directors after the Sunset.
The declaration and payment by us of any future dividends to holders of our Class A common stock is at the sole discretion of our Executive Committee or our board of directors until the Sunset, and then by the board of directors after the Sunset.
Investing throughout the corporate capital structure. Our funds invest in a broad range of asset classes throughout the corporate capital structure, including preferred equity securities, common equity securities, loans and debt securities; and certain of our funds also engage in short selling.
Our funds invest in a broad range of asset classes throughout the corporate capital structure, including preferred equity securities, common equity securities, loans and debt securities; and certain of our funds also engage in short selling.
In some instances, we may determine that growth in a specific area is best achieved through the acquisition of an existing business, as with our recent acquisition of TPG Angelo Gordon.
In some instances, we may determine that growth in a specific area is best achieved through the acquisition of an existing business, as with our acquisition of TPG Angelo Gordon.
The use of hedging transactions and other derivative instruments to reduce the effects of a decline in the value of a position does not eliminate the possibility of fluctuations in the value of the position or prevent losses if the value of the position declines.
The use of hedging transactions and other derivative instruments to offset or reduce the effects of a decline in the value of a position does not eliminate the possibility of fluctuations in the value of the position or prevent losses if the value of the position declines.
Our and our third-party service providers’ information systems and technology may be unable to accommodate our growth, adequately protect the information of our individual fund investors or address security risks, and the cost of maintaining such systems and technology may increase from our current level. 41 Table of Contents Such a failure to accommodate growth, or an increase in costs related to such information systems and technology, could have a material adverse effect on our results of operations, financial condition and cash flow.
Our and our third-party service providers’ information systems and technology may be unable to accommodate our growth, adequately protect the information of our individual fund investors or address security risks, and the cost of maintaining such systems and technology may increase from our current level. 40 Table of Contents Such a failure to accommodate growth, or an increase in costs related to such information systems and technology, could have a material adverse effect on our results of operations, financial condition and cash flow.
Certain portfolio companies are facing, or may face in the future, increased credit and liquidity risk due to volatility in financial markets, increased costs of existing floating rate indebtedness in light of the rising interest rate environment, reduced revenue streams and limited or higher cost of access to preferred sources of funding, which could negatively affect us or our funds’ investments.
Certain portfolio companies are facing, or may face in the future, increased credit and liquidity risk due to volatility in financial markets, increased costs of existing floating rate indebtedness in a rising interest rate environment, reduced revenue streams and limited or higher cost of access to preferred sources of funding, which could negatively affect us or our funds’ investments.
A disaster or a disruption in technology or infrastructure that supports our businesses, including a disruption involving electronic communications or other parts or services used by us, our vendors or third parties with whom we conduct business, including custodians, paying agents and escrow agents, or directly affecting our principal offices, could negatively impact our ability to continue to operate our business without interruption.
A disaster or more significant disruption in technology or infrastructure that supports our businesses, including a disruption involving electronic communications or other parts or services used by us, our vendors or third parties with whom we conduct business, including custodians, paying agents and escrow agents, or directly affecting our principal offices, could negatively impact our ability to continue to operate our business without interruption.
Our funds will generally be unable to sell these securities publicly unless we register their sale under applicable securities laws or we can rely on an available exemption, and in either case only at such times when we do not possess material non-public 37 Table of Contents information.
Our funds will generally be unable to sell these securities publicly unless we register their sale under applicable securities laws 36 Table of Contents or we can rely on an available exemption, and in either case only at such times when we do not possess material non-public information.
As such, we have no independent means of generating revenue or cash flow, and our ability to pay our taxes and operating expenses, including to satisfy our obligations under the Tax Receivable Agreement, or declare and pay dividends in the future, depend upon the results of operations and cash flows of the TPG Operating Group and its consolidated subsidiaries and distributions we receive from the TPG Operating Group.
As such, we have no independent means of generating revenue or cash flow, and our ability to pay our taxes and operating expenses, including to satisfy our obligations under the Tax Receivable Agreement, or declare and pay dividends in the future, depends upon the results of operations and cash flows of the TPG Operating Group and its consolidated subsidiaries and distributions we receive from the TPG Operating Group.
Our business is materially affected by conditions in the global financial markets and economic conditions or events throughout the world that are outside of our control, such as fluctuating interest rates, availability of credit, inflation rates, economic uncertainty, changes in laws (including laws relating to taxation and regulations on the financial industry), pandemics or other severe public health events, trade barriers, commodity prices, currency exchange rates and controls, national and international political circumstances (including government shutdowns, wars, terrorist acts or security operations) and the effects of climate change.
Our business is materially affected by conditions in the global financial markets and economic conditions or events throughout the world that are outside of our control, such as fluctuating interest rates, availability of credit, inflation rates, economic uncertainty, changes in laws (including laws relating to taxation and regulations on the financial industry), pandemics or other severe public health events, trade barriers, commodity prices, currency exchange rates and controls, national and international political circumstances (including government shutdowns, wars, threatened military conflicts, terrorist acts or security operations) and the effects of climate change.
In general, losses related to terrorism are becoming harder and more expensive to insure against. Some insurers are excluding terrorism coverage from their all-risk policies or offering significantly limited coverage against terrorist acts for additional premiums, which can greatly increase the total cost of casualty insurance for a property.
In general, losses related to terrorism and cyber incidents are becoming harder and more expensive to insure against. Some insurers are excluding terrorism coverage from their all-risk policies or offering significantly limited coverage against terrorist acts for additional premiums, which can greatly increase the total cost of casualty insurance for a property.
The current U.S. political environment and the resulting uncertainties regarding actual and potential shifts in U.S. foreign investment, trade, taxation, economic, environmental and other policies under the Biden administration could lead to disruption, instability and volatility in the global markets. The consequences of previously enacted legislation could also impact our business operations in the future.
The current U.S. political environment and the resulting uncertainties regarding actual and potential shifts in U.S. foreign investment, trade, taxation, economic, environmental and other policies under the Trump administration could lead to disruption, instability and volatility in the global markets. The consequences of previously enacted legislation could also impact our business operations in the future.
Our real estate funds may also make investments in residential real estate projects and/or otherwise participate in financing opportunities relating to residential real estate assets or portfolios thereof from time to time, which may be more highly susceptible to adverse changes in prevailing economic and/or market conditions and present additional risks relative to the ownership and operation of commercial real estate assets.
Our real estate funds may also from time to time make investments in residential real estate projects and/or otherwise participate in financing opportunities relating to residential real estate assets, which may be more highly susceptible to adverse changes in prevailing economic and/or market conditions and present additional risks relative to the ownership and operation of commercial real estate assets.
These restrictions could constrain the operation and profitability of firms in those industries, and therefore, negatively impact our funds’ investments in those sectors. • Consumer Goods : China has recently enforced stringent regulations (including but not limited to the latest amendment to the Juvenile Protection Law, which came into effect on June 1, 2021) “to protect the physical and mental health of minors,” including significant limitations on the use of online gaming and private tutoring services for young adults and teenagers in China.
These restrictions could constrain the operation and profitability of firms in those industries, and therefore, negatively impact our funds’ investments in those sectors. • Consumer Goods : China has recently enforced stringent regulations (including the latest amendment to the Juvenile Protection Law, which came into effect on June 1, 2021) “to protect the physical and mental health of minors,” including significant limitations on the use of online gaming and private tutoring services for young adults and teenagers in China.
In addition, investors in our open-ended funds, including certain of our credit funds and our public equity funds, and our BDC, have the ability to redeem their fund interests and move their capital to other investments; these funds’ management fees and performance allocations would decline if we are unable to raise capital to replace that of redeeming fund investors.
In addition, investors in our open-ended credit, public equity and other funds, and our BDC, have the ability to redeem their fund interests and move their capital to other investments; these funds’ management fees and performance allocations would decline if we are unable to raise capital to replace that of redeeming fund investors.
See also “—Risks Related to Our Organizational Structure—The historical and pro forma financial information and related notes in this report may not permit you to assess our future performance”. Use of subscription line facilities by our funds. Most of our funds obtain subscription line facilities to, among other things, facilitate investments.
See also “—Risks Related to Our Organizational Structure—The historical and pro forma financial information and related notes in this report may not permit you to assess our future performance”. Use of subscription line facilities by our funds. Most of our funds obtain subscription line facilities to, among other things, facilitate investments and finance operations.
Investors in our funds do not have legal remedies against us solely based on their dissatisfaction with the investment performance of such funds. However, investors may have remedies against us, the general partners of our funds, our funds, our employees, or our affiliates to the extent any losses result from fraud, negligence, willful misconduct or other similar malfeasance.
Investors in our funds do not have legal remedies against us solely based on their dissatisfaction with the investment performance of such funds. However, investors may have remedies against us, the general partners of our funds, our funds, our employees, or our affiliates to the extent any losses result from fraud, negligence, willful misconduct or other alleged malfeasance.
A number of jurisdictions, including the United Kingdom and certain European Union Member States, have announced proposals to implement aspects of the pillar two proposals with effect from December 31, 2023 (broadly, the “income inclusion rule” and the “domestic top-up tax”) with further aspects to be introduced from December 31, 2024 (broadly, the “undertaxed payments rule”).
A number of jurisdictions, including the United Kingdom and certain European Union Member States, have introduced legislation to implement aspects of the pillar two proposals with effect from December 31, 2023 (broadly, the “income inclusion rule” and the “domestic top-up tax”) with further aspects to be introduced from December 31, 2024 (broadly, the “undertaxed payments rule”).
Item 1A. Risk Factors Risks Related to Our Business We depend on our senior leadership and key investment and other professionals, and the loss of their services or investor confidence in such professionals could have a material adverse effect on our results of operations, financial condition and cash flow.
Item 1A. Risk Factors Risks Related to Our Business We depend on our senior leadership and key investment and other professionals, and the loss of their services or investor confidence in them could have a material adverse effect on our results of operations, financial condition and cash flow.
While we periodically meet with the management of Managing Entities in which our funds invest, and our funds may negotiate contractual terms requiring such Managing Entities to periodically provide the funds with certain information, our funds generally do not have the opportunity to evaluate the specific strategies employed by the Managing Entities and their funds, and our funds do not have an active role in the day-to-day management of the Managing Entities.
While we periodically meet with the management of managing entities in which our funds invest, and our funds may negotiate contractual terms requiring managing entities to periodically provide the funds with certain information, our funds generally do not have the opportunity to evaluate the specific strategies employed by the managing entities and their funds, and our funds do not have an active role in the managing entities’ day-to-day management.
See “—Ongoing trade negotiations and the potential for further regulatory reform in the U.S. and abroad may create regulatory uncertainty for us, our funds and our funds’ portfolio companies and our investment strategies and negatively impact the profitability of our funds and our funds’ portfolio companies.” For example, the tax authorities in certain countries, including certain EU member states, have sought to deny the benefits of income tax treaties or EU directives with respect to withholding taxes on interest and dividends and capital gains of non-resident entities.
See “—Ongoing trade negotiations and the potential for further regulatory reform in the United States and abroad may create regulatory uncertainty for us, our funds and our funds’ portfolio companies and our investment strategies and negatively impact the profitability of our funds and our funds’ portfolio companies.” For example, the tax authorities in certain countries, including certain EU member states, have sought to deny the benefits of income tax treaties or EU directives with respect to withholding taxes on interest and dividends and capital gains of non-resident entities.
Pursuant to the A&R Exchange Agreement, a non-U.S. holder of Common Units is entitled to have such holder’s Common Units 88 Table of Contents exchanged for cash from a substantially concurrent public offering or private sale (based on the closing price per share of the Class A common stock on the day before the pricing of such public offering or private sale (taking into account customary brokerage commissions or underwriting discounts actually incurred)) or (at our option) shares of our Class A common stock (or, in certain cases, shares of our nonvoting Class A common stock).
Pursuant to the A&R Exchange Agreement, a non-U.S. holder of Common Units is entitled to have such holder’s Common Units exchanged for cash from a substantially concurrent public offering or private sale (based on the closing price per share of the Class A common stock on the day before the pricing of such public offering or private sale (taking into account customary brokerage commissions or underwriting discounts actually incurred)) or (at our option) shares of our Class A common stock (or, in certain cases, shares of our nonvoting Class A common stock).
Such laws and regulations strengthen the rights of individuals (data subjects), mandate stricter controls over the processing of personal data by both controllers and processors of personal data and impose stricter sanctions with substantial administrative fines and potential claims for damages from data subjects for breach of their rights, among other 43 Table of Contents requirements.
Such laws and regulations strengthen the rights of individuals (data subjects), mandate stricter controls over the processing of personal 42 Table of Contents data by both controllers and processors of personal data and impose stricter sanctions with substantial administrative fines and potential claims for damages from data subjects for breach of their rights, among other requirements.
Generally, with respect to our private equity and credit distributions, although we recognize performance allocations on an accrual basis, we receive performance allocation payments (i) from our historical TPG funds, only upon disposition of an investment by the relevant fund and (ii) from our TPG Angelo Gordon funds, only after the respective fund’s investors have received their capital contributions in the fund and certain preferred returns, in each case contributing to the volatility of our cash flow.
Generally, with respect to our private equity and credit distributions, although we recognize performance allocations on an 32 Table of Contents accrual basis, we receive performance allocation payments (i) from our historical TPG funds, only upon disposition of an investment by the relevant fund and (ii) from our TPG Angelo Gordon funds, only after the respective fund’s investors have received their capital contributions in the fund and certain preferred returns, in each case contributing to the volatility of our cash flow.
If we are unable to successfully manage conflicts of interest relating to arrangements with our partners, directors, senior advisors, professionals or business partners, fund investors may decrease their commitments to future funds, we could be subject to lawsuits or regulatory enforcement actions or we could face other adverse consequences and reputational harm, all of which could cause our and our funds’ performance to suffer and thus adversely affect our results of operations, financial condition and cash flow.
If we are unable to successfully manage conflicts of interest relating to arrangements with our partners, directors, senior advisors, professionals or business partners, fund investors may decrease 48 Table of Contents their commitments to future funds, we could be subject to lawsuits or regulatory enforcement actions or we could face other adverse consequences and reputational harm, all of which could cause our and our funds’ performance to suffer and thus adversely affect our results of operations, financial condition and cash flow.
As a result, allegations of improper conduct by private litigants (including investors in or alongside our funds), regulators or employees, whether the ultimate outcome is favorable or unfavorable to us, as well as negative publicity and press speculation about us, our investment activities, our lines of business, our workplace environment or the private equity industry in general, whether or not valid, may harm our reputation, which may be more damaging to our business than to other types of businesses.
As a result, allegations of improper conduct made by private litigants (including investors in or alongside our funds), regulators or employees, whether the ultimate outcome is favorable or unfavorable to us, as well as negative publicity and press speculation about us, our investment activities, our lines of business, our workplace environment or the private equity industry in general, whether or not valid, may harm our reputation, which may be more damaging to our business than it would be to other types of businesses.
See “—The clawback provisions in our governing agreements may give rise to contingent obligations that may require us to return amounts to our funds and fund investors.” 25 Table of Contents Our inability to raise new funds or capital for our funds could result in lower management fees and less capital to invest and place pressure on fees and fee arrangements of future funds, which could have a material adverse effect on our results of operations, financial condition and cash flow.
See “—The clawback provisions in our governing agreements may give rise to contingent obligations that may require us to return amounts to our funds and fund investors.” Our inability to raise new funds or capital for our funds could result in lower management fees and less capital to invest and place pressure on fees and fee arrangements of future funds, which could have a material adverse effect on our results of operations, financial condition and cash flow.
While we have elected in our restated certificate of incorporation not to be subject to Section 203 of the DGCL, our restated certificate of incorporation contains provisions that have the same effect as Section 203 of the DGCL, except that they provide that the TPG Operating Group, its affiliates, groups that include the TPG Operating Group and certain of their direct and indirect transferees are not deemed to be “interested stockholders,” regardless of the percentage of our voting stock owned by them, and accordingly are not subject to such restrictions.
While we have elected in our 65 Table of Contents restated certificate of incorporation not to be subject to Section 203 of the DGCL, our restated certificate of incorporation contains provisions that have the same effect as Section 203 of the DGCL, except that they provide that the TPG Operating Group, its affiliates, groups that include the TPG Operating Group and certain of their direct and indirect transferees are not deemed to be “interested stockholders,” regardless of the percentage of our voting stock owned by them, and accordingly are not subject to such restrictions.
While we maintain offices in Hong Kong and our funds invest in portfolio companies that operate in Hong Kong or are currently or expected to be listed on the Stock Exchange of Hong Kong (which investments comprise approximately 3% of our AUM), none of our funds invests exclusively in Hong Kong; our Hong Kong operations, including our personnel and investments, do not represent a significant portion of our business; and our portfolio companies do not generally engage in commercial practices that would implicate the National Security Law.
While we maintain offices in Hong Kong and our funds invest in portfolio companies that operate in Hong Kong or are currently or expected to be listed on the Stock Exchange of Hong Kong (which investments comprise approximately 0.2 of our AUM), none of our funds invests exclusively in Hong Kong; our Hong Kong operations, including our personnel and investments, do not represent a significant portion of our business; and our portfolio companies do not generally engage in commercial practices that would implicate the National Security Law.
Our determination of whether to engage a professional as an employee or a consultant can give rise to conflicts of interest because, in general, except with respect to certain in-house, foreign office and specialized operational services provided to certain funds, we bear the compensation costs for our employees whereas compensation costs for consultants could be paid by us, a fund or a portfolio company, as described above.
Our determination of whether to engage a professional as an employee or a consultant can give rise to conflicts of interest because, in general, except with respect to certain in-house, foreign office and specialized operational services provided to certain funds, we bear the compensation costs for our employees whereas compensation costs for consultants could be paid by us, a fund or a 49 Table of Contents portfolio company, as described above.
Management fee revenue constitutes the largest portion of income from our business and depends on the pace of investment activity in our funds. For almost all of our funds, we charge management fees based on the amount of capital invested during a portion, and sometimes all, of a fund’s fee-paying life.
Management fee revenue constitutes the largest portion of income from our business and depends on the pace of investment activity in our funds. For nearly all of our funds, we charge management fees based on the amount of capital invested during a portion, and sometimes all, of a fund’s fee-paying life.
Many of our funds invest a significant portion of their assets in the equity or other securities of issuers located outside the United States, including (in order of concentration as of December 31, 2023) Europe, India, China, Australia, Singapore, Korea, and Malaysia.
Many of our funds invest a significant portion of their assets in the equity or other securities of issuers located outside the United States, including (in order of concentration as of December 31, 2024) Europe, India, China, Australia, Singapore, Korea, and Malaysia.
The Reform Act amends various sections of the Dodd-Frank Act. The Reform Act and various other proposals focused on deregulation of the U.S. financial services industry could have the effect of increasing competition or otherwise reducing investment opportunities, which could negatively impact our business.
The Reform Act amends various sections of the Dodd-Frank Act. The Reform Act and various other proposals focused on deregulation of the U.S. financial services industry could have the effect of increasing competition or otherwise reducing investment opportunities, which could negatively impact our business. For example, the U.S.
In addition, many pay to play regimes (including the SEC pay to play rule for investment advisers) impute the 80 Table of Contents personal political activities of certain executives and employees, and in some instances their spouses and family members, to the manager for purposes of potential pay to play liability.
In addition, many pay to play regimes (including the SEC pay to play rule for investment advisers) impute the 78 Table of Contents personal political activities of certain executives and employees, and in some instances their spouses and family members, to the manager for purposes of potential pay to play liability.
See “—Our activities and the business activities of certain of our personnel may give rise to conflicts of interest with our funds, and our failure to deal appropriately with conflicts of interest could damage our reputation and negatively impact our business.” Certain of our management agreements with investment vehicles that are publicly-registered companies with the SEC are subject to limitation or termination, and any such termination could have a material adverse effect on our business, results of operations and financial condition.
See “—Our activities and the business activities of certain of our personnel may give rise to conflicts of interest with our funds, and our failure to deal appropriately with conflicts of interest could damage our reputation and negatively impact our business.” 54 Table of Contents Certain of our management agreements with investment vehicles that are publicly registered companies with the SEC are subject to limitation or termination, and any such termination could have a material adverse effect on our business, results of operations and financial condition.
In May 2016, the SEC and other federal regulatory agencies proposed a rule that would apply requirements on incentive-based compensation arrangements of “covered financial institutions,” including certain registered investment advisers and broker-dealers above a specific asset threshold. This, if adopted, could limit our ability to recruit and retain investment professionals and senior management executives.
In May 2016 and, more recently, in May 2024, the SEC and other federal regulatory agencies proposed a rule that would apply requirements on incentive-based compensation arrangements of “covered financial institutions,” including certain registered investment advisers and broker-dealers above a specific asset threshold. This, if adopted, could limit our ability to recruit and retain investment professionals and senior management executives.
For example, TPG Capital BD could influence the placement of portfolio company securities or debt instruments so that investors who are sizeable investors in multiple of our funds or who pay TPG Capital BD a placement fee receive an allocation ahead of others.
For example, TPG Capital BD (or a related entity) could influence the placement of portfolio company securities or debt instruments so that investors who are sizeable investors in multiple of our funds or who pay TPG Capital BD (or a related entity) a placement fee receive an allocation ahead of others.
In addition, we may waive the foregoing restrictions under certain circumstances as contemplated in the A&R Investor Rights Agreement.
In addition, we may waive the foregoing restrictions under circumstances as contemplated in the A&R Investor Rights Agreement.
The adoption, interpretation and application of privacy laws or regulations in the U.S., EU (and its member states), the U.K. and elsewhere are often uncertain and in flux, and in some cases, laws or regulations in one country may be inconsistent with, or contrary to, those of another country.
The adoption, interpretation and application of privacy laws or regulations in the United States, EU (and its member states), the U.K. and elsewhere are often uncertain and in flux, and in some cases, laws or regulations in one country may be inconsistent with, or contrary to, those of another country.
For instance, TPG Capital BD (or a related entity) could take the place of another investment bank in the syndicate underwriting a securities offering or act as the sole or lead financial institution on a transaction instead of a third-party bank.
For instance, TPG Capital BD (or a related entity) could take the place of another investment bank in the syndicate underwriting a securities offering or debt placement or act as the sole or lead financial institution on a transaction instead of a third-party bank.
Ongoing global conflicts have likewise exacerbated these risks due to the scale of related offensive cyber-attacks that could directly, 42 Table of Contents indirectly or inadvertently impact business far removed from the battlefield. For example, U.S. companies were harmed by NotPetya attacks in 2017, which were attributed to the Russian military in connection with Russia’s annexation of Crimea.
Ongoing global conflicts have likewise exacerbated these risks due to the scale of related offensive cyber-attacks that could directly, indirectly or inadvertently impact business far removed from the battlefield. For example, U.S. companies were harmed by NotPetya attacks in 2017, which were attributed to the Russian military in connection with Russia’s annexation of Crimea.
Such actions could negatively impact our relationships with investors in those businesses, subject us to litigation or regulatory inquiries and expose us to additional expenses, including impairment charges and potential liability from investor or other complaints.
Such actions could negatively impact our relationships with investors in those businesses, subject us to reputational harm, litigation or regulatory inquiries and expose us to additional expenses, including impairment charges and potential liability from investor or other complaints.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeItem 1C. Cybersecurity Risk Management and Strategy We have adopted processes designed to identify, assess and manage material risks from cybersecurity threats.
Biggest changeItem 1C. Cybersecurity Risk Management and Strategy We have adopted processes designed to identify, assess and manage material risks from cybersecurity threats. Those processes include risk assessments of internal and external threats to confidentiality, integrity and availability of the Company’s data and systems along with other material risks to firm operations.
The Chief Information Security Officer reports at least annually, to our Audit Committee and such report may address overall assessment of the Company’s compliance with this and other cybersecurity policies, including topics such as risk assessment, risk management and control decisions, service provider arrangements, test results, security incidents and responses, and recommendations for changes and updates to policies and procedures.
The Chief Information Security Officer reports at least annually to the Audit Committee and such report may address overall assessment of the Company’s compliance with our cybersecurity policies, including risk assessment, risk management and control decisions, service provider arrangements, test results, security incidents and responses, and recommendations for changes and updates to policies and procedures.
Governance We have established an Enterprise Risk Committee (“ERC”) to manage overall risk across the Company including cybersecurity risks identified by the cybersecurity team; the ERC includes representatives from relevant functions and is led by our Chief Executive Officer (“CEO”). We have also established an Operational Risk Committee (“ORC”) which is responsible for applying the policy decisions of the ERC.
Governance We have established an Enterprise Risk Committee (“ERC”) to manage overall risk across the Company including cybersecurity risks identified by the Cybersecurity team; the ERC includes representatives from relevant functions and is led by our CEO. We have also established an Operational Risk Committee (“ORC”) which is responsible for applying the policy decisions of the ERC.
Operational responsibility for ensuring the adequacy and effectiveness of our risk management, control and governance processes is assigned to our Chief Information Security 89 Table of Contents Officer, who periodically reports, among other things, potentially material cybersecurity incidents to the ORC and, in coordination with the Chief Information Officer and Head of Operations, reports to the ERC at least annually.
Operational responsibility for ensuring the adequacy and effectiveness of our risk management, control and governance processes is assigned to our Chief Information Security Officer (“CISO”), who periodically reports, among other things, potentially material cybersecurity incidents to the ORC and reports to the ERC at least annually.
As of the date of this report, we are not aware of any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition.
As of the date of this report, we are not aware of any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations or financial condition. Cyber criminals do, however, target TPG and our employees and vendors.
Removed
Those processes include responses to and assessments of internal and external threats to the security, confidentiality, integrity and availability of the Company’s data and systems along with other material risks to firm operations, at least annually or whenever there are material changes to our systems or operations.
Added
These risk assessments inform our cybersecurity program and the continued development of a layered set of controls aimed at preventing, detecting and responding to threats.
Removed
As part of our risk management process, we engage outside providers to conduct periodic internal and external penetration testing. We use NIST Cybersecurity Framework and CIS Critical Security Controls as a guide to help us identify, assess, and manage cybersecurity relevant to our business. This does not imply that we meet any particular technical standards, specifications, or requirements.
Added
Our administrative, organizational, technical and physical security controls include, but are not limited to, policies and procedures, system hardening vulnerability scanning and patching, employee training and awareness, third-party risk management processes, backup and recovery processes, access controls, data encryption in transit and at rest, network perimeter controls and identity verification.
Removed
We store firm data in cloud environments with security appropriate to the data involved and have adopted controls around, among other things, vendor risk assessment, access and acceptable use and backup and recovery.
Added
We also have policies and controls in place designed to detect and respond to cybersecurity events, including an incident response plan, an incident response team with dedicated roles and responsibilities for assessing and responding to a cybersecurity event, system logging and ongoing monitoring, and periodic training exercises simulating cybersecurity events that are designed to raise awareness and test our team’s response readiness capabilities. 86 Table of Contents The nature, scope and effectiveness of these controls are regularly reviewed through a series of internal and external processes.
Removed
We have processes to oversee and identify material risks associated with the use of third-party service providers, taking into account the nature of the services provided, the sensitivity and quantity of information processed, and the identity of the service provider.
Added
The Cybersecurity team performs both automated monitoring on a continuous basis and manual reviews of key controls. We also conduct annual assessments of our cybersecurity program using industry standard cybersecurity frameworks, such as the NIST Cybersecurity Framework, as benchmarks to perform our evaluation. This does not imply that we fully meet any particular industry standards, specifications or requirements.
Removed
The Chief Information Security Officer leads the Company’s cybersecurity team, which includes individuals dedicated to incident detection and response. This team is responsible for identifying threats that can impact the Company and designing controls to mitigate vulnerabilities before they are exploited and to detect and neutralize any threats that do materialize.
Added
In addition, independent reviews of our cybersecurity control effectiveness are conducted by TPG’s Internal Audit team on a periodic basis. We also engage external providers to conduct periodic external assessments, including penetration testing.
Removed
The Chief Information Security Officer and Chief Information Officer each have more than 20 years of experience in their fields. The Chief Information Security Officer and senior members of the cybersecurity team hold industry standard certifications. Our Audit Committee is briefed on cybersecurity risks at least once each year and as needed in connection with any potentially material cybersecurity incidents.
Added
The Cybersecurity team also regularly coordinates with other key stakeholders within the Firm, including Compliance, Human Resources, Internal Audit and Legal. The Chief Information Security Officer leads the Company’s Cybersecurity team, which is responsible for implementing, maintaining and enforcing our cybersecurity program.
Added
Our CISO previously held various leadership roles within the Technology Risk department of one of the world’s largest banking institutions over a 17-year period. He holds a Bachelor of Science in Electrical Engineering and Mathematics from the University of Texas at Arlington and is a Certified Information Systems Security Professional (CISSP).
Added
Our Cybersecurity team possesses a variety of cybersecurity skill sets and extensive expertise obtained through decades of experience, numerous industry certifications, and advanced degrees. The Cybersecurity team continues to take steps to maintain up-to-date knowledge of evolving cybersecurity threats and countermeasures. The Audit Committee of our Board of Directors has primary oversight over the Cybersecurity program.
Added
Ongoing or future attacks such as these could have impacts on TPG’s operations. For additional information on these ongoing risks please refer to “Part 1. Item 1A.
Added
Risk Factors — Failure to maintain the security of our information and technology networks or data security breaches could harm our reputation and have a material adverse effect on our results of operations, financial condition, and cash flow”.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeIncreased regulatory focus on the alternative asset industry or legislative or regulatory changes could result in additional burdens and expenses on our business.” We are not currently subject to any pending legal (including judicial, regulatory, administrative or arbitration) proceedings that we expect to have a material impact on our Consolidated Financial Statements.
Biggest changeIncreased regulatory focus on the alternative asset industry or legislative or regulatory changes could result in additional burdens and expenses on our business.” We are not currently subject to any pending legal (including judicial, regulatory, administrative or arbitration) proceedings that we expect to have a material impact on 87 Table of Contents our operations, financial position or cash flows.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 90 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 90 Item 6. [Removed and Reserved] 92 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 93 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 159 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 88 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 88 Item 6. [Removed and Reserved] 89 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 90 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 136 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeFor more information on DE, see “Item 7.—Management’s Discussion and Analysis of Financial Results of Operation—Non-GAAP Financial Metrics—Distributable Earnings.” Prior to the Sunset, any future determination as to the declaration and payment of dividends, if any, will be at the discretion of the board of directors and Executive Committee and will depend on a number of factors, including: • general economic and business conditions; • our strategic plans and prospects; • our business and investment opportunities; • our financial condition and operating results; • our available cash and current and anticipated cash needs; • our capital requirements; • contractual, legal, tax and regulatory restrictions and implications on the payment of dividends by us to our stockholders or by our subsidiaries (including payment obligations pursuant to the Tax Receivable Agreement) to us; and • such other factors as the board of directors and Executive Committee may deem relevant.
Biggest changeFor more information on DE, see “Item 7.—Management’s Discussion and Analysis of Financial Results of Operation—Non-GAAP Financial Measures—Distributable Earnings.” Prior to the Sunset, any future determination as to the declaration and payment of dividends, if any, will be at the discretion of the board of directors and Executive Committee and will depend on a number of factors, including: • general economic and business conditions; • our strategic plans and prospects; • our business and investment opportunities; • our financial condition and operating results; • our available cash and current and anticipated cash needs; • our capital requirements; • contractual, legal, tax and regulatory restrictions and implications on the payment of dividends by us to our stockholders or by our subsidiaries (including payment obligations pursuant to the Tax Receivable Agreement) to us; and • such other factors as the board of directors and Executive Committee may deem relevant. 88 Table of Contents In addition, the TPG Operating Group Limited Partnership agreements generally require that pro rata cash distributions be made to holders of Common Units, including us, at certain assumed tax rates, which we refer to as “tax distributions.” Further, subject to funds being legally available, we intend to cause the TPG Operating Group to make pro rata cash distributions to holders of Common Units, including us, that will enable us, when combined with the tax distributions we receive, to pay our taxes, make all payments required under the Tax Receivable Agreement and pay other expenses.
Dividend Policy Our current intention is to pay holders of our Class A common stock and nonvoting Class A common stock a quarterly dividend representing at least 85% of TPG Inc.’s share of DE attributable to the TPG Operating Group, subject to adjustment as determined by our board of directors and, until the Sunset, the Executive Committee of our board of directors to be necessary or appropriate to provide for the conduct of our business, to make appropriate investments in our business and funds, to comply with applicable law, any of our debt instruments or other agreements, or to provide for future cash 90 Table of Contents requirements such as tax-related payments and clawback obligations.
Dividend Policy Our current intention is to pay holders of our Class A common stock and nonvoting Class A common stock a quarterly dividend representing at least 85% of TPG Inc.’s share of DE attributable to the TPG Operating Group, subject to adjustment as determined by our board of directors and, until the Sunset, the Executive Committee of our board of directors to be necessary or appropriate to provide for the conduct of our business, to make appropriate investments in our business and funds, to comply with applicable law, any of our debt instruments or other agreements, or to provide for future cash requirements such as tax-related payments and clawback obligations.
We are a holding company, and our only material assets are Common Units representing 22% of the Common Units and 100% of the interests in certain intermediate holding companies.
We are a holding company, and our only material assets are Common Units representing 30% of the Common Units and 100% of the interests in certain intermediate holding companies.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Shares of our Class A common stock are listed on the Nasdaq Global Select Market under the symbol “TPG.” The number of holders of record of our common stock was 77 as of February 20, 2024.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Shares of our Class A common stock are listed on the Nasdaq Global Select Market under the symbol “TPG.” The number of holders of record of our Class A common stock was 59 as of February 14, 2025.
This does not include the number of stockholders that hold shares in “street-name” through banks or broker-dealers.
This does not include the number of stockholders that hold shares in “street-name” through banks or broker-dealers. The number of holders of record of our nonvoting Class A common stock and Class B common stock as of February 14, 2025 was one and four, respectively.
Removed
In addition, the TPG Operating Group Limited Partnership agreements generally require that pro rata cash distributions be made to holders of Common Units, including us, at certain assumed tax rates, which we refer to as “tax distributions.” Further, subject to funds being legally available, we intend to cause the TPG Operating Group to make pro rata cash distributions to holders of Common Units, including us, that will enable us, when combined with the tax distributions we receive, to pay our taxes, make all payments required under the Tax Receivable Agreement and pay other expenses.
Added
Holders of Promote Units will not be entitled to cash distributions from the TPG Operating Group, except for certain distributions of performance allocations received by the TPG Operating Group. Recent Sales of Unregistered Securities None. Issuer Purchases of Equity Securities Not Applicable.
Removed
Holders of Promote Units will not be entitled to cash distributions from the TPG Operating Group, except certain distributions of performance allocations received by the TPG Operating Group. 91 Table of Contents Recent Sales of Unregistered Securities In connection with the closing of the Angelo Gordon acquisition, on November 1, 2023 (“Closing”), the Angelo Gordon Parties received (i) 53.0 million Common Units, subject to certain adjustments, (ii) 8.4 million RSUs that, subject to the terms and conditions of the RSUs, will settle in shares of our Class A common stock, subject to certain adjustments and (iii) rights to an earnout payment of up to $400 million in value (the “Earnout Payment”), subject to the satisfaction of certain fee-related revenue targets during the period beginning on January 1, 2026 and ending on December 31, 2026.
Removed
The Earnout Payment is payable, at TPG Operating Group II, L.P.’s election, subject to certain limitations set forth in the Transaction Agreement, in cash, Common Units (and an equal number of shares of Class B common stock) (the “Earnout Equity Payment”).
Removed
On November 13, 2023, upon effectiveness of our Certificate of Amendment of the Amended and Restated Certificate of Incorporation, we issued to the Angelo Gordon Parties 53.0 million shares of Class B common stock.
Removed
The Common Units and shares of Class B common stock issued in connection with the Acquisition were not and will not be registered under the Securities Act, and were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act.
Removed
The Common Units and shares of Class B common stock are subject to the terms of our A&R Investor Rights Agreement, which sets forth certain transfer restrictions and customary registration rights with respect to the shares of Class A common stock, shares of Class B common stock and Common Units (including any Common Units received as part of the Earnout Equity Payment).
Removed
In particular, applicable Angelo Gordon Parties may not transfer or exchange (i) any shares of Class A common stock, shares of Class B common stock or Common Units prior to the first anniversary of Closing; (ii) from the first anniversary until the second anniversary of Closing, more than one third (1/3) of the number of shares of Class A common stock, shares of Class B common stock or Common Units owned, directly or indirectly, by the applicable Angelo Gordon Parties as of Closing; and (iii) between the second and third anniversary of Closing, more than two thirds (2/3) of the number of shares of Class A common stock, shares of Class B common stock or Common Units owned, directly or indirectly, by the applicable Angelo Gordon Parties as of Closing.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeSee “Item 1A.Risk Factors—Risks Related to Our Business—Our funds’ historical returns should not be considered as indicative of our or our funds’ future results or of any returns expected on an investment in our Class A common stock.” 144 Table of Contents The following tables reflect the performance of our selected funds as of December 31, 2023 ($ in millions): Fund Vintage Year (1) Capital Committed (2) Capital Invested (3) Realized Value (4) Unrealized Value (5) Total Value (6) Gross IRR (7) Gross MoM (7) Net IRR (8) Net MoM (9) Platform: Capital Capital Funds Air Partners 1993 $ 64 $ 64 $ 697 $ — $ 697 81 % 10.9x 73 % 8.9x TPG I 1994 721 696 3,095 — 3,095 47 % 4.4x 36 % 3.5x TPG II 1997 2,500 2,554 5,010 — 5,010 13 % 2.0x 10 % 1.7x TPG III 1999 4,497 3,718 12,360 — 12,360 34 % 3.3x 26 % 2.6x TPG IV 2003 5,800 6,157 13,733 — 13,733 20 % 2.2x 15 % 1.9x TPG V 2006 15,372 15,564 22,071 1 22,072 6 % 1.4x 5 % 1.4x TPG VI 2008 18,873 19,220 33,344 196 33,540 14 % 1.7x 10 % 1.5x TPG VII 2015 10,495 10,205 19,422 4,506 23,928 26 % 2.3x 20 % 1.9x TPG VIII 2019 11,505 10,737 3,264 15,438 18,702 37 % 1.7x 25 % 1.5x TPG IX 2022 12,014 4,662 — 5,225 5,225 225 % 1.2x 39 % 1.0x Capital Funds 81,841 73,577 112,996 25,366 138,362 23 % 1.9x 15 % 1.6x Asia Funds Asia I 1994 96 78 71 — 71 (3 %) 0.9x (10 %) 0.7x Asia II 1998 392 764 1,669 — 1,669 17 % 2.2x 14 % 1.9x Asia III 2000 724 623 3,316 — 3,316 46 % 5.3x 31 % 3.8x Asia IV 2005 1,561 1,603 4,089 — 4,089 23 % 2.6x 17 % 2.1x Asia V 2007 3,841 3,257 5,405 166 5,571 10 % 1.7x 6 % 1.4x Asia VI 2012 3,270 3,285 3,380 3,505 6,885 15 % 2.1x 11 % 1.7x Asia VII 2017 4,630 4,522 2,341 5,652 7,993 21 % 1.7x 14 % 1.4x Asia VIII 2022 4,319 2,022 — 2,375 2,375 686 % 1.2x 129 % 1.1x Asia Funds 18,833 16,154 20,271 11,698 31,969 20 % 2.0x 14 % 1.7x Healthcare Funds THP I 2019 2,704 2,405 840 2,978 3,818 33 % 1.6x 19 % 1.3x THP II 2022 3,576 1,093 — 1,294 1,294 339 % 1.3x 85 % 1.1x Healthcare Funds 6,280 3,498 840 4,272 5,112 35 % 1.5x 20 % 1.3x Continuation Vehicles TPG AAF 2021 1,317 1,314 2,720 — 2,720 43 % 2.1x 37 % 1.9x TPG AION 2021 207 207 — 182 182 (5 %) 0.9x (6 %) 0.9x Continuation Vehicles 1,524 1,521 2,720 182 2,902 37 % 1.9x 31 % 1.7x Platform: Growth Growth Funds STAR 2007 1,264 1,259 1,865 42 1,907 13 % 1.5x 6 % 1.3x Growth II 2011 2,041 2,185 4,734 598 5,332 22 % 2.5x 16 % 2.0x Growth III 2015 3,128 3,370 4,675 2,306 6,981 26 % 2.0x 18 % 1.7x Growth IV 2017 3,739 3,612 1,946 4,890 6,836 22 % 1.8x 15 % 1.5x Gator 2019 726 686 661 608 1,269 31 % 1.8x 25 % 1.6x Growth V 2020 3,558 3,225 403 4,375 4,778 29 % 1.5x 18 % 1.3x Growth VI 2023 1,112 144 — 144 144 NM NM NM NM Growth Funds 15,568 14,481 14,284 12,963 27,247 20 % 1.9x 14 % 1.6x Tech Adjacencies Funds TTAD I 2018 1,574 1,497 941 1,709 2,650 25 % 1.7x 20 % 1.5x TTAD II 2021 3,198 1,763 63 1,896 1,959 9 % 1.1x 4 % 1.0x Tech Adjacencies Funds 4,772 3,260 1,004 3,605 4,609 22 % 1.4x 16 % 1.3x TDM 2017 1,326 571 — 1,142 1,142 20 % 2.0x 16 % 1.7x LSI 2023 367 84 — 84 84 NM NM NM NM 145 Table of Contents Fund Vintage Year (1) Capital Committed (2) Capital Invested (3) Realized Value (4) Unrealized Value (5) Total Value (6) Gross IRR (7) Gross MoM (7) Net IRR (8) Net MoM (9) Platform: Impact The Rise Funds Rise I 2017 $ 2,106 $ 1,996 $ 1,318 $ 2,511 $ 3,829 21 % 1.9x 13 % 1.5x Rise II 2020 2,176 1,973 128 2,817 2,945 25 % 1.5x 16 % 1.3x Rise III 2022 2,700 1,103 5 1,261 1,266 98 % 1.2x (2 %) 1.0x The Rise Funds 6,982 5,072 1,451 6,589 8,040 22 % 1.6x 14 % 1.3x TSI 2018 333 133 368 — 368 35 % 2.8x 25 % 2.1x Evercare 2019 621 432 29 326 355 (5 %) 0.8x (10 %) 0.7x Rise Climate 2021 7,268 4,579 208 5,839 6,047 54 % 1.4x 27 % 1.2x TPG NEXT 2023 510 3 — 3 3 NM NM NM NM Platform: Real Estate TPG Real Estate Partners DASA RE 2012 1,078 576 1,069 — 1,069 21 % 1.9x 15 % 1.6x TREP II 2014 2,065 2,213 3,520 60 3,580 28 % 1.7x 18 % 1.5x TREP III 2018 3,722 4,151 2,630 2,606 5,236 14 % 1.3x 9 % 1.2x TREP IV 2022 6,820 1,708 208 1,481 1,689 (14 %) 0.9x (63 %) 0.5x TPG Real Estate Partners 13,685 8,648 7,427 4,147 11,574 21 % 1.5x 13 % 1.3x TAC+ 2021 1,797 916 98 815 913 (1 %) 1.0x (4 %) 0.9x TRECO 378 — — — — NM NM NM NM Platform: Market Solutions NewQuest Funds NewQuest I (11) 2011 390 291 767 — 767 48 % 3.2x 37 % 2.3x NewQuest II (11) 2013 310 342 646 115 761 25 % 2.3x 19 % 1.8x NewQuest III (11) 2016 541 543 412 450 862 13 % 1.6x 8 % 1.3x NewQuest IV (11) 2020 1,000 879 132 1,108 1,240 23 % 1.4x 13 % 1.2x NewQuest V (11) 2022 502 272 7 344 351 NM NM NM NM NewQuest Funds 2,743 2,327 1,964 2,017 3,981 35 % 1.8x 23 % 1.5x TGS (11) 2022 749 272 — 295 295 NM NM NM NM Platform: TPG Angelo Gordon Credit Solutions Credit Solutions Credit Solutions I 2019 1,805 1,801 1,475 1,156 2,631 17 % 1.5x 13 % 1.4x Credit Solutions I Dislocation A 2020 909 602 795 — 795 34 % 1.3x 27 % 1.3x Credit Solutions I Dislocation B 2020 308 176 211 — 211 28 % 1.2x 21 % 1.2x Credit Solutions II 2021 3,134 2,559 245 2,655 2,900 16 % 1.1x 11 % 1.1x Credit Solutions II Dislocation A 2022 1,310 868 5 1,001 1,006 34 % 1.2x 25 % 1.1x Credit Solutions 7,466 6,006 2,731 4,812 7,543 19 % 1.3x 14 % 1.2x Essential Housing Essential Housing I 2020 642 456 470 102 572 15 % 1.3x 12 % 1.2x Essential Housing II 2021 2,534 1,071 59 1,112 1,171 14 % 1.1x 10 % 1.1x Essential Housing 3,176 1,527 529 1,214 1,743 14 % 1.2x 11 % 1.1x Structured Credit & Specialty Finance ABC Fund 2021 1,005 653 29 709 738 17 % 1.1x 13 % 1.1x Structured Credit & Specialty Finance 1,005 653 29 709 738 17 % 1.1x 13 % 1.1x 146 Table of Contents Fund Vintage Year (1) Capital Committed (2) Capital Invested (3) Realized Value (4) Unrealized Value (5) Total Value (6) Gross IRR (7) Gross MoM (7) Net IRR (8) Net MoM (9) Middle Market Direct Lending (12) MMDL I 2015 $ 594 $ 572 $ 846 $ — $ 846 14 % 1.6x 10 % 1.4x MMDL II 2016 1,580 1,563 1,684 608 2,292 14 % 1.6x 11 % 1.5x MMDL III 2018 2,751 2,548 1,929 1,648 3,577 14 % 1.5x 10 % 1.4x MMDL IV 2020 2,671 2,522 457 2,713 3,170 16 % 1.3x 12 % 1.3x MMDL IV Annex 2021 797 672 69 700 769 15 % 1.2x 11 % 1.2x MMDL V 2022 1,972 603 6 668 674 18 % 1.2x 14 % 1.2x Middle Market Direct Lending 10,365 8,480 4,991 6,337 11,328 15 % 1.5x 11 % 1.4x U.S.
Biggest changeSee “Item 1A.Risk Factors—Risks Related to Our Business—Our funds’ historical returns should not be considered as indicative of our or our funds’ future results or of any returns expected on an investment in our Class A common stock.” 120 Table of Contents The following tables reflect the performance of our selected funds as of December 31, 2024 ($ in millions): Fund Vintage Year (1) Capital Committed (2) Capital Invested (3) Realized Value (4) Unrealized Value (5) Total Value (6) Gross IRR (7) Gross MoM (7) Net IRR (8) Net MoM (9) Platform: Capital Capital Funds Air Partners 1993 $ 64 $ 64 $ 697 $ — $ 697 81 % 10.9x 73 % 8.9x TPG I 1994 721 696 3,095 — 3,095 47 % 4.4x 36 % 3.5x TPG II 1997 2,500 2,554 5,010 — 5,010 13 % 2.0x 10 % 1.7x TPG III 1999 4,497 3,718 12,360 — 12,360 34 % 3.3x 26 % 2.6x TPG IV 2003 5,800 6,157 13,734 — 13,734 20 % 2.2x 15 % 1.9x TPG V 2006 15,372 15,564 22,074 — 22,074 6 % 1.4x 5 % 1.4x TPG VI 2008 18,873 19,220 33,360 155 33,515 14 % 1.7x 10 % 1.5x TPG VII 2015 10,495 10,215 21,153 3,762 24,915 26 % 2.4x 20 % 2.0x TPG VIII 2019 11,505 10,738 5,227 14,842 20,069 28 % 1.8x 19 % 1.5x TPG IX 2022 12,014 7,228 12 9,147 9,159 42 % 1.3x 21 % 1.1x Capital Funds 81,841 76,154 116,722 27,906 144,628 23 % 1.9x 15 % 1.6x Asia Funds Asia I 1994 96 78 71 — 71 (3 %) 0.9x (10 %) 0.7x Asia II 1998 392 764 1,669 — 1,669 17 % 2.2x 14 % 1.9x Asia III 2000 724 623 3,316 — 3,316 46 % 5.3x 31 % 3.8x Asia IV 2005 1,561 1,603 4,089 — 4,089 23 % 2.6x 17 % 2.1x Asia V 2007 3,841 3,257 5,438 118 5,556 10 % 1.7x 6 % 1.4x Asia VI 2012 3,270 3,285 4,061 2,453 6,514 13 % 2.0x 9 % 1.6x Asia VII 2017 4,630 4,582 3,545 4,306 7,851 17 % 1.7x 10 % 1.4x Asia VIII 2022 5,259 2,679 — 3,376 3,376 37 % 1.3x 11 % 1.1x Asia Funds 19,773 16,871 22,189 10,253 32,442 20 % 2.0x 14 % 1.6x Healthcare Funds THP I 2019 2,704 2,430 889 3,192 4,081 25 % 1.7x 15 % 1.4x THP II 2022 3,576 1,697 2 2,235 2,237 51 % 1.4x 24 % 1.2x Healthcare Funds 6,280 4,127 891 5,427 6,318 27 % 1.6x 16 % 1.3x Continuation Vehicles TPG AAF 2021 1,317 1,314 2,720 — 2,720 43 % 2.1x 37 % 1.9x TPG AION 2021 207 207 — 136 136 (12 %) 0.7x (12 %) 0.6x Continuation Vehicles 1,524 1,521 2,720 136 2,856 35 % 1.9x 29 % 1.7x Platform: Growth Growth Funds STAR 2007 1,264 1,259 1,895 — 1,895 12 % 1.5x 6 % 1.3x Growth II 2011 2,041 2,185 4,846 469 5,315 21 % 2.5x 15 % 2.0x Growth III 2015 3,128 3,377 4,782 2,236 7,018 25 % 2.0x 16 % 1.7x Growth IV 2017 3,739 3,624 3,185 4,540 7,725 21 % 2.1x 15 % 1.7x Gator 2019 726 686 770 479 1,249 26 % 1.8x 21 % 1.6x Growth V 2020 3,558 3,280 668 4,893 5,561 24 % 1.7x 16 % 1.4x Growth VI 2023 2,191 987 1 1,170 1,171 273 % 1.3x 72 % 1.1x Growth Funds 16,647 15,398 16,147 13,787 29,934 20 % 2.0x 14 % 1.6x Tech Adjacencies Funds TTAD I 2018 1,574 1,497 1,179 1,499 2,678 21 % 1.7x 16 % 1.5x TTAD II 2021 3,198 2,179 214 2,669 2,883 18 % 1.3x 13 % 1.2x TTAD III 381 — — — — NM NM NM NM Tech Adjacencies Funds 5,153 3,676 1,393 4,168 5,561 20 % 1.5x 15 % 1.4x TDM 2017 1,326 583 — 1,054 1,054 14 % 1.8x 11 % 1.6x LSI 2023 410 160 — 163 163 (16 %) 0.9x (58 %) 0.7x 121 Table of Contents Fund Vintage Year (1) Capital Committed (2) Capital Invested (3) Realized Value (4) Unrealized Value (5) Total Value (6) Gross IRR (7) Gross MoM (7) Net IRR (8) Net MoM (9) Platform: Impact The Rise Funds Rise I 2017 $ 2,106 $ 2,017 $ 1,543 $ 2,260 $ 3,803 17 % 1.8x 11 % 1.5x Rise II 2020 2,176 2,044 309 2,967 3,276 20 % 1.6x 13 % 1.4x Rise III 2022 2,700 1,783 41 2,349 2,390 48 % 1.4x 22 % 1.2x The Rise Funds 6,982 5,844 1,893 7,576 9,469 19 % 1.6x 12 % 1.4x Rise Climate Funds Rise Climate I 2021 7,268 5,483 1,077 6,339 7,416 29 % 1.4x 14 % 1.2x Rise Climate II (20) 4,659 — — — — NM NM NM NM Rise Climate Global South (20) 200 — — — — NM NM NM NM Rise Climate TI 1,308 — — — — NM NM NM NM Rise Climate Funds 13,435 5,483 1,077 6,339 7,416 29 % 1.4x 14 % 1.2x TSI 2018 333 133 368 — 368 35 % 2.8x 25 % 2.1x Evercare 2019 621 444 32 518 550 5 % 1.2x 1 % 1.0x TPG NEXT (11) 2023 554 7 — 7 7 NM NM NM NM Platform: Real Estate TPG Real Estate Partners TREP II 2014 2,065 2,213 3,555 18 3,573 28 % 1.7x 18 % 1.5x TREP III 2018 3,722 4,249 3,113 2,503 5,616 13 % 1.4x 9 % 1.3x TREP IV 2022 6,820 3,522 546 3,282 3,828 9 % 1.1x (8 %) 0.9x TPG Real Estate Partners 12,607 9,984 7,214 5,803 13,017 20 % 1.4x 11 % 1.2x TAC+ 2021 1,797 1,040 100 949 1,049 0 % 1.0x (1 %) 1.0x TRECO 2024 550 563 373 210 583 NM NM NM NM Platform: Market Solutions NewQuest Funds NewQuest I (11) 2011 390 291 767 — 767 48 % 3.2x 37 % 2.3x NewQuest II (11) 2013 310 342 667 89 756 24 % 2.3x 19 % 1.8x NewQuest III (11) 2016 541 543 503 362 865 12 % 1.6x 8 % 1.4x NewQuest IV (11) 2020 1,000 958 145 1,176 1,321 15 % 1.4x 8 % 1.2x NewQuest V (11) 2022 673 327 137 357 494 60 % 1.8x 42 % 1.5x NewQuest Funds 2,914 2,461 2,219 1,984 4,203 34 % 1.8x 21 % 1.5x TGS (11) 2022 1,864 359 — 521 521 NM 3.0x NM 3.2x Platform: TPG Angelo Gordon Credit Solutions Credit Solutions Credit Solutions I 2019 1,805 1,801 1,889 850 2,739 17 % 1.6x 13 % 1.4x Credit Solutions I Dislocation A 2020 909 602 795 — 795 34 % 1.3x 27 % 1.3x Credit Solutions I Dislocation B 2020 308 176 211 — 211 28 % 1.2x 21 % 1.2x Credit Solutions II 2021 3,134 2,730 712 2,773 3,485 17 % 1.3x 13 % 1.2x Credit Solutions II Dislocation A 2022 1,310 868 837 207 1,044 22 % 1.2x 16 % 1.2x Credit Solutions III 2024 2,211 — — 80 80 NM NM NM NM Credit Solutions 9,677 6,177 4,444 3,910 8,354 19 % 1.4x 14 % 1.3x Essential Housing Essential Housing I 2020 642 456 562 15 577 15 % 1.3x 12 % 1.2x Essential Housing II 2021 2,534 1,071 641 685 1,326 16 % 1.3x 12 % 1.2x Essential Housing III 2024 1,414 312 — 313 313 NM NM NM NM Essential Housing 4,590 1,839 1,203 1,013 2,216 16 % 1.3x 12 % 1.2x Hybrid Solutions 155 — — — — NM NM NM NM Structured Credit & Specialty Finance ABC Fund I 2021 1,005 864 95 995 1,090 18 % 1.3x 14 % 1.2x ABC Fund II 2024 393 — — (3) (3) NM NM NM NM Structured Credit & Specialty Finance 1,398 864 95 992 1,087 18 % 1.3x 14 % 1.2x 122 Table of Contents Fund Vintage Year (1) Capital Committed (2) Capital Invested (3) Realized Value (4) Unrealized Value (5) Total Value (6) Gross IRR (7) Gross MoM (7) Net IRR (8) Net MoM (9) Middle Market Direct Lending (12) MMDL I 2015 $ 594 $ 572 $ 846 $ — $ 846 14 % 1.6x 10 % 1.4x MMDL II 2016 1,580 1,563 1,747 591 2,338 14 % 1.7x 10 % 1.5x MMDL III 2018 2,751 2,547 2,347 1,319 3,666 13 % 1.6x 10 % 1.4x MMDL IV 2020 2,671 2,586 1,056 2,432 3,488 15 % 1.5x 11 % 1.4x MMDL IV Annex 2021 797 767 213 739 952 15 % 1.4x 11 % 1.3x MMDL V 2022 3,924 1,427 156 1,468 1,624 18 % 1.2x 14 % 1.2x Middle Market Direct Lending 12,317 9,462 6,365 6,549 12,914 14 % 1.5x 11 % 1.4x U.S.
Fees and other consists primarily of (i) management and incentive fees, (ii) monitoring fees, (iii) transaction fees, (iv) incentive fee income and (v) expense reimbursements from unconsolidated funds, portfolio companies and third parties.
Fees and other consists primarily of (i) management fees, (ii) monitoring fees, (iii) transaction fees, (iv) incentive fee income and (v) expense reimbursements from unconsolidated funds, portfolio companies and third parties.
Assets Under Management Assets Under Management (“AUM”) represents the sum of: i. fair value of the investments and financial instruments held by our private equity, credit and real estate funds (including fund-level asset-related leverage), other than as described below, as well as related co-investment vehicles managed or advised by us, plus the capital that we are entitled to call from investors in those funds and vehicles, pursuant to the terms of their respective capital commitments, net of outstanding leverage associated with subscription-related credit facilities, and including capital commitments to funds that have yet to commence their investment periods; ii. the gross amount of assets (including leverage where applicable) for our real estate investment trusts and BDCs; iii. the net asset value of certain of our hedge funds; iv. the aggregate par amount of collateral assets, including principal cash, for our collateralized loan obligation vehicles; and v.
Assets Under Management Assets Under Management (“AUM”) represents the sum of: i. fair value of the investments and financial instruments held by our private equity, credit and real estate funds (including fund-level asset-related leverage), other than as described below, as well as related co-investment vehicles managed or advised by us, plus the capital that we are entitled to call from investors in those funds and vehicles, pursuant to the terms of their respective capital commitments, net of outstanding leverage associated with subscription-related credit facilities, and including capital commitments to funds that have yet to commence their investment periods; ii. the gross amount of assets (including leverage where applicable) for our real estate investment trusts and BDCs; iii. the net asset value of certain of our hedge funds; and iv. the aggregate par amount of collateral assets, including principal cash, for our collateralized loan obligation vehicles.
FAUM is the sum of all the individual fee bases that are used to calculate our management fees and differs from AUM in the following respects: (i) assets and commitments from which we are not entitled to receive a management fee are excluded (e.g., assets and commitments with respect to which the firm is entitled to receive only performance allocations or are otherwise not currently entitled to receive a management fee) and (ii) certain assets, primarily in our credit and real estate funds, have different methodologies for calculating management fees that are not based on the fair value of the respective funds’ underlying investments.
FAUM is the sum of all the individual fee bases that are used to calculate our management fees and differs from AUM in the following respects: (i) assets and commitments from which we are not entitled to receive a management fee are excluded (e.g., assets and commitments with respect to which we are entitled to receive only performance allocations or are otherwise not currently entitled to receive a management fee) and (ii) certain assets, primarily in our credit and real estate funds, have different methodologies for calculating management fees that are not based on the fair value of the respective funds’ underlying investments.
GAAP in that it does not include (i) unrealized performance allocations and related compensation and benefit expense, (ii) unrealized investment income, (iii) equity-based compensation expense, (iv) net income (loss) attributable to non-controlling interests in consolidated entities, or (v) certain other items, such as contingent reserves. While we believe that the inclusion or exclusion of the aforementioned U.S.
GAAP in that it does not include (i) unrealized performance allocations and related compensation expense, (ii) unrealized investment income, (iii) equity-based compensation expense, (iv) net income (loss) attributable to non-controlling interests in consolidated entities, or (v) certain other items, such as contingent reserves. While we believe that the inclusion or exclusion of the aforementioned U.S.
(2) After the Reorganization, we retained an economic interest in performance allocations from the Growth III and Asia VI general partner entities, which entitles us to a performance allocation equal to 10%; however, we intend to allocate the full amount as performance allocation compensation expense.
(2) After the Reorganization, we retained an economic interest in performance allocations from the Growth III and Asia VI general partner entities, which entitles us to a performance allocation equal to 10%; however, we allocate the full amount as performance allocation compensation expense.
This is a result of the fact that the accounts of the consolidated entities being reflected on a gross basis, with intercompany transactions eliminated, while the allocable share of those amounts that are attributable to third parties are reflected as single line items.
GAAP. This is a result of the fact that the accounts of the consolidated entities being reflected on a gross basis, with intercompany transactions eliminated, while the allocable share of those amounts that are attributable to third parties are reflected as single line items.
Business Combinations We account for business combinations using the acquisition method under ASC Topic 805, Business Combinations (“ASC 805”) under which the purchase price of the acquisition is allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date.
Business Combinations We account for business combinations using the acquisition method under ASC Topic 805, Business Combinations (“ASC 805”) under which the purchase price of the acquisition is allocated to the assets acquired and liabilities assumed generally using the fair values determined by management as of the acquisition date.
Capital Raised Capital raised is the aggregate amount of subscriptions and capital raised by our investment funds and co-investment vehicles during a given period, as well as the senior and subordinated notes issued through the firm’s CLOs and equity raised through our perpetual vehicles.
Capital Raised Capital raised is the aggregate amount of subscriptions and capital raised by our investment funds and co-investment vehicles during a given period, as well as the senior and subordinated notes issued through our CLOs and equity raised through our perpetual vehicles.
After-tax Distributable Earnings (“After-tax DE”) is a non-GAAP performance measure of our distributable earnings after reflecting the impact of income taxes. We use it to assess how income tax expense affects amounts available to be distributed to our Class A common stock holders and Common Unit holders. After-tax DE differs from U.S. GAAP net income computed in accordance with U.S.
After-tax Distributable Earnings (“After-tax DE”) is a non-GAAP performance measure of our distributable earnings after reflecting the impact of income taxes. We use it to assess how income tax expense affects amounts available to be distributed to our Class A common stockholders and Common Unit holders. After-tax DE differs from U.S. GAAP net income computed in accordance with U.S.
Gross performance figures are presented after any investment-related expenses, a 1% annual management fee, net interest, other expenses and the reinvestment of dividends, and include any gains or losses from “new issue” securities. (16) Total Return includes onshore investors participating directly through the master fund and investors through the offshore vehicle. Total Return for the offshore vehicle was 4%.
Gross performance figures are presented after any investment-related expenses, a 1% annual management fee, net interest, other expenses and the reinvestment of dividends, and include any gains or losses from “new issue” securities. (17) Total Return includes onshore investors participating directly through the master fund and investors through the offshore vehicle. Total Return for the offshore vehicle was 4%.
The table below highlights performance allocations for the years ended December 31, 2023 and 2022, and separates the entities listed into two categories to reflect the Reorganization: (i) TPG general partner entities from which the TPG Operating Group Common Unit holders are expected to receive a 20% performance allocation and (ii) TPG general partner entities from which the TPG Operating Group Common Unit holders are not expected to receive any performance allocation.
The table below highlights performance allocations for the years ended December 31, 2024 and 2023, and separates the entities listed into two categories to reflect the Reorganization: (i) TPG general partner entities from which the TPG Operating Group Common Unit holders are expected to receive a 20% performance allocation and (ii) TPG general partner entities from which the TPG Operating Group Common Unit holders are not expected to receive any performance allocation.
Fund Performance Metrics Fund performance information for our investment funds as of December 31, 2023 is included throughout this discussion and analysis to facilitate an understanding of our results of operations for the periods presented. These fund performance metrics do not include co-investment vehicles, SMAs or certain other legacy or discontinued funds.
Fund Performance Metrics Fund performance information for our investment funds as of December 31, 2024 is included throughout this discussion and analysis to facilitate an understanding of our results of operations for the periods presented. These fund performance metrics do not include co-investment vehicles, SMAs or certain other legacy or discontinued funds.
We believe that our current sources of liquidity described below are sufficient to meet our projected capital needs and other obligations as they arise for at least the next 12 months. To the extent that our current liquidity is insufficient to fund future activities, we may need to raise additional funds.
We believe that our current sources of liquidity described below are sufficient to meet our projected capital needs and other obligations as they arise for at least the next twelve months. To the extent that our current liquidity is insufficient to fund future activities, we may need to raise additional funds.
In August 2023, the subsidiary extended the maturity date of the Subordinated Credit Facility from August 2024 to August 2025. The interest rate for borrowings under the Subordinated Credit Facility is calculated at a term Secured Overnight Financing Rate (“SOFR”) rate plus a 0.10% per annum adjustment and 2.25%.
In August 2024, the subsidiary extended the maturity date of the Subordinated Credit Facility from August 2025 to August 2026. The interest rate for borrowings under the Subordinated Credit Facility is calculated at a term Secured Overnight Financing Rate (“SOFR”) rate plus a 0.10% per annum adjustment and 2.25%.
(11) Unless otherwise specified, the fund performance information presented above for certain funds is, due to the nature of their strategy, as of September 30, 2023. (12) Each Middle Market Direct Lending fund is comprised of four vehicles: onshore levered, onshore unlevered, offshore levered and offshore unlevered.
(11) Unless otherwise specified, the fund performance information presented above for certain funds is, due to the nature of their strategy, as of September 30, 2024. (12) Each Middle Market Direct Lending fund is comprised of four vehicles: onshore levered, onshore unlevered, offshore levered and offshore unlevered.
Principal amounts outstanding under the amended Senior Unsecured Term Loan Agreement accrue interest, at the option of the borrower, either (i) at a base rate plus an applicable margin of 0.00% or (ii) at a term SOFR rate plus a 0.10% per annum adjustment and an applicable margin of 1.00%.
Principal amounts outstanding under the amended Senior Unsecured Term Loan Agreement accrued interest, at the option of the borrower, either (i) at a base rate plus an applicable margin of 0.00% or (ii) at a term SOFR rate plus a 0.10% per annum adjustment and an applicable margin of 1.00%.
The Net IRRs and Net MoMs for TPG AG Middle Market Direct Lending funds on a consolidated basis were: (i) for the onshore unlevered vehicles, 7% and 1.3x, (ii) for the offshore levered vehicles, 10% and 1.3x and (iii) for the offshore unlevered vehicles, 7% and 1.1x. (13) Japanese-Yen denominated fund.
The Net IRRs and Net MoMs for TPG AG Middle Market Direct Lending funds on a consolidated basis were: (i) for the onshore unlevered vehicles, 7% and 1.3x, (ii) for the offshore levered vehicles, 10% and 1.3x and (iii) for the offshore unlevered vehicles, 7% and 1.2x. (13) Japanese-Yen denominated fund.
The secured borrowings contain covenants and conditions customary in transactions of this nature, including negative pledge provisions, default provisions and financial covenants and limitations on certain consolidations, mergers and sales of assets. As of December 31, 2023, we were in compliance with these covenants and conditions.
The secured borrowings contain covenants and conditions customary in transactions of this nature, including negative pledge provisions, default provisions and financial covenants and limitations on certain consolidations, mergers and sales of assets. As of December 31, 2024, we were in compliance with these covenants and conditions.
(5) Reduction in Fee Base represents decreases in the fee basis for funds where the investment or commitment fee period has expired, and the fee base has reduced from commitment base to actively invested capital. It also includes reductions for funds that are no longer fee paying.
(4) Reduction in Fee Base represents decreases in the fee basis for funds where the investment or commitment fee period has expired, and the fee base has reduced from commitment base to actively invested capital. It also includes reductions for funds that are no longer fee paying.
Examples of critical estimates in valuing certain of the intangible assets we have acquired include, but are not limited to, future expected cash inflows and outflows, future fundraising assumptions, expected useful life, discount rates and income tax rates.
Examples of critical estimates in valuing certain of the intangible assets we have acquired include, but are not limited to, future expected cash inflows and outflows, future fundraising assumptions, expected useful lives, discount rates and income tax rates.
Risk-Free Rate (“RFR”) loans are denominated in Sterling and subject to a fixed interest rate computed daily as the Sterling Overnight Index Average (“SONIA”) in effect five business days prior to the date of borrowing, plus an applicable margin of between 151 Table of Contents 2.00% and 3.00%, depending on the term of the loan.
Risk-Free Rate (“RFR”) loans are denominated in Sterling and subject to a fixed interest rate computed daily as the Sterling Overnight Index Average (“SONIA”) in effect five business days prior to the date of borrowing, plus an applicable margin of between 2.00% and 3.00%, depending on the term of the loan.
The types of financial instruments generally classified in this category include 156 Table of Contents securities with less liquidity traded in active markets, securities traded in other than active markets, corporate bonds and loans, and government and agency securities. • Level III—Pricing inputs are unobservable for the financial instruments and include situations where there is little, if any, market activity for the financial instrument.
The types of financial instruments generally classified in this category include securities with less liquidity traded in active markets, securities traded in other than active markets, corporate bonds and loans, and government and agency securities. • Level III—Pricing inputs are unobservable for the financial instruments and include situations where there is little, if any, market activity for the financial instrument.
Depending on the facts and circumstances associated with the investment, different primary and secondary methodologies may be used including direct capitalization method, option value, contingent claims or scenario analysis, yield analysis, projected cash flow through maturity or expiration, probability weighted methods or recent round of financing. 157 Table of Contents Credit Investments .
Depending on the facts and circumstances associated with the investment, different primary and secondary methodologies may be used including direct capitalization method, option value, contingent claims or scenario analysis, yield analysis, projected cash flow through maturity or expiration, probability weighted methods or recent round of financing. Credit Investments .
Distributable Earnings (“DE”) is used to assess performance and amounts potentially available for distributions to partners. DE is derived from and reconciled to, but not equivalent to, its most directly comparable U.S. GAAP measure of net income. DE differs from U.S. GAAP net income computed in accordance with U.S.
Non-GAAP Financial Measures Distributable Earnings. Distributable Earnings (“DE”) is used to assess performance and amounts potentially available for distributions to partners. DE is derived from and reconciled to, but not equivalent to, its most directly comparable U.S. GAAP measure of net income. DE differs from U.S. GAAP net income computed in accordance with U.S.
Performance Generating AUM refers to 140 Table of Contents the AUM of funds we manage that are currently above their respective hurdle rate or preferred return, and profit of such funds are being allocated to, or earned by, us in accordance with the applicable limited partnership agreements or other governing agreements.
Performance Generating AUM refers to the AUM of funds we manage that are currently above their respective hurdle rate or preferred return, and profit of such funds are being allocated to, or earned by, us in accordance with the applicable limited partnership agreements or other governing agreements.
Changes in global economic conditions and regulatory or other governmental policies or actions can materially affect the values of funds managed by TPG, as well as our ability to source attractive investments and deploy the capital that we have raised.
Trends Affecting our Business Changes in global economic conditions and regulatory or other governmental policies or actions can materially affect the values of funds managed by TPG, as well as our ability to source attractive investments and deploy the capital that we have raised.
GAAP; 94 Table of Contents • the rights to an aggregate cash payment, payable in three payments of up to $50.0 million each, reflecting an aggregate of $150.0 million (the “Aggregate Annual Cash Holdback Amount”); and • the non-compensatory portion under U.S.
GAAP; • the rights to an aggregate cash payment, payable in three payments of up to $50.0 million each, reflecting an aggregate of $150.0 million (the “Aggregate Annual Cash Holdback Amount”); and • the non-compensatory portion under U.S.
Realized gains (losses) may be recognized when we redeem all or a portion of an investment interest or when we receive a distribution of capital. Unrealized gains (losses) result from the appreciation (depreciation) in the fair value of our investments.
Investment Income Net Gains (Losses) from Investment Activities . Realized gains (losses) may be recognized when we redeem all or a portion of an investment interest or when we receive a distribution of capital. Unrealized gains (losses) result from the appreciation (depreciation) in the fair value of our investments.
We account for our investment balances in the TPG funds, including performance allocations, under the equity method of accounting because we are presumed to have significant influence as the general partner or managing member; however, we do not have control as defined by Accounting Standards Codification (“ASC”) Topic 810, Consolidation .
We account for our investment balances in the TPG funds, including performance allocations, under the equity method of accounting because we are presumed to have significant influence as the general partner or managing member; however, we do not have control as defined by ASC Topic 810, Consolidation .
We use FRE to measure the ability of our business to cover compensation and operating expenses from fee revenues other than capital allocation-based income. The use of FRE without consideration of the related U.S. GAAP measures is not adequate due to the adjustments described herein. Fee-Related Revenues . Fee-related revenues is a component of FRE.
We use FRE to measure the ability of our business to cover compensation and operating expenses from fee revenues other than capital allocation-based income. The use of FRE without consideration of the related U.S. GAAP measures is not adequate due to the adjustments described herein. 102 Table of Contents Fee-Related Revenues . Fee-related revenues (“FRR”) is a component of FRE.
FAUM Subject to Step-Up as of December 31, 2023 relates primarily to TPG IX within the Capital platform, MMDL IV, MMDL V and Credit Solutions II within TPG AG Credit and Realty Value XI and Asia Realty V within TPG AG Real Estate.
FAUM Subject to Step-Up as of December 31, 2024 relates primarily to TPG IX within the Capital platform, Credit Solutions II and MMDL V within TPG AG Credit and Realty Value XI and Asia Realty V within TPG AG Real Estate.
Fee-related Performance Compensation The following table presents fee-related performance compensation for the years ended December 31, 2023 and 2022: Year Ended December 31, 2023 2022 ($ in thousands) TPG AG Credit $ 1,407 $ — TPG AG Real Estate (6) — Total Fee-related Performance Compensation $ 1,401 (1) $ — ___________ (1) Includes amounts from TPG Angelo Gordon from November 1, 2023, the date of the Acquisition, through December 31, 2023.
Fee-related Performance Compensation The following table presents fee-related performance compensation for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 ($ in thousands) TPG AG Credit $ 16,516 $ 1,407 TPG AG Real Estate — (6) Total Fee-related Performance Compensation $ 16,516 $ 1,401 (1) ___________ (1) Includes amounts from TPG Angelo Gordon from November 1, 2023, the date of the Acquisition, through December 31, 2023.
Performance allocations are generally realized when an underlying investment is profitably disposed of and the fund’s cumulative returns are in excess of the specific hurdle rates, as defined in the applicable governing documents.
Performance allocations are generally 133 Table of Contents realized when an underlying investment is profitably disposed of and the fund’s cumulative returns are in excess of the specific hurdle rates, as defined in the applicable governing documents.
The accounting policies we believe to reflect our more significant estimates, judgments and assumptions that are most critical to understanding and evaluating our reported financial results are: revenue recognition and fair value measurements. Revenues We recognize revenue in accordance with ASC 606.
The accounting policies we believe to reflect our more significant estimates, judgments and assumptions that are most critical to understanding and evaluating our reported financial results are: revenue recognition, fair value measurements, business combinations and intangible assets. Revenues We recognize revenue in accordance with ASC 606.
GAAP net income before income tax and includes the current payable under our Tax Receivable Agreement, which is recorded within other liabilities in our Consolidated Statements of Financial Condition.
GAAP net income before income tax and includes the current payable under our Tax Receivable Agreement, which is recorded within due to affiliates and other liabilities in our Consolidated Statements of Financial Condition.
The performance estimates are based on an investment in TPG Public Equity Partners, LP made on September 1, 2013, the date of TPEP’s inception, with the performance estimates for the period from January 1, 2016 to present being based on an investment in TPG Public Equity Partners Master Fund, L.P. made through TPG Public Equity Partners-A, L.P., the “onshore feeder.” As of December 31, 2023, TPEP Long/Short had estimated inception-to-date gross returns of 172% and net returns of 126%.
The performance estimates are based on an investment in TPG Public Equity Partners, LP made on September 1, 2013, the date of TPEP’s inception, with the performance estimates for the period from January 1, 2016 to present being based on an investment in TPG Public Equity Partners Master Fund, L.P. made through TPG Public Equity Partners-A, L.P., the “onshore feeder.” As of December 31, 2024, TPEP Long/Short had estimated inception-to-date gross returns of 191% and net returns of 138%.
Organization We are a holding company and our only business is to act as the owner of the entities serving as the general partner of the TPG Operating Group partnerships and our only material assets are Common Units representing approximately 22% of the legally outstanding Common Units and 100% of the interests in certain intermediate holding companies as of December 31, 2023.
Organization We are a holding company and our only business is to act as the owner of the entities serving as the general partner of the TPG Operating Group partnerships and our only material assets are Common Units representing approximately 30% of the outstanding Common Units and 100% of the interests in certain intermediate holding companies as of December 31, 2024.
These performance estimates represent performance for TPEP Long Only and are based on an investment in TPEP Long Only made on May 1, 2019, the date of TPEP Long Only’s inception, through TPG Public Equity Partners Long Opportunities-A, L.P., the “onshore feeder.” As of December 31, 2023, TPEP Long Only had estimated inception-to-date gross returns of 39% and net returns of 39%.
(16) These performance estimates represent performance for TPEP Long Only and are based on an investment in TPEP Long Only made on May 1, 2019, the date of TPEP Long Only’s inception, through TPG Public Equity Partners Long Opportunities-A, L.P., the “onshore feeder.” As of December 31, 2024, TPEP Long Only had estimated inception-to-date gross returns of 60% and net returns of 59%.
As of December 31, 2023, accrued performance allocations presented as investments in the Consolidated Statement of Financial Condition for Common Unit holders TPG Operating Group shared TPG general partner entities totaled $5.3 billion.
As of December 31, 2024, accrued performance allocations presented as investments in the Consolidated Statement of Financial Condition for Common Unit holders TPG Operating Group shared TPG general partner entities totaled $5.7 billion.
Associated with FAUM Subject to Step-Up, management fee rates on undrawn commitments for these respective underlying funds range between 0.05% and 1.70% and step-up to rates in the range of 0.25% and 1.75% after capital is invested or as a fund reaches a certain point in its life where the fee rate for certain investors increases.
Associated with FAUM Subject to Step-Up, management fee rates for these respective underlying funds range between 0.24% and 1.75% and step-up to rates in the range of 0.25% and 1.75% after capital is invested or as a fund reaches a certain point in its life where the fee rate for certain investors increases.
The fair value of the investments held by TPG funds is the primary input to the calculation of certain of our management fees, incentive fees, capital allocation based income, and performance allocation compensation. The TPG funds are accounted for as investment companies in accordance with U.S. GAAP guidance and reflect their investments, including majority-owned and controlled investments, at fair value.
The fair value of the investments held by TPG funds is the primary input to the calculation of certain of our management fees, incentive fees, capital allocation based income, and performance allocation compensation. The TPG funds are accounted for as investment companies in accordance with ASC 946 and reflect their investments, including majority-owned and controlled investments, at fair value.
The secured borrowings are separated into two tranches. Tranche A secured borrowings (the “Series A Securitization Notes”) were issued in May 2018 at a fixed rate of 5.33% with an aggregate principal balance of $200.0 million due June 20, 2038, with interest payable semiannually.
Tranche A secured borrowings (the “Series A Securitization Notes”) were issued in May 2018 at a fixed rate of 5.33% with an aggregate principal balance of $200.0 million due June 20, 2038, with interest payable semiannually.
Depreciation and amortization increased by $14.7 million for the year ended December 31, 2023 compared to the year ended December 31, 2022. This change was primarily due to the amortization of intangible assets resulting from the acquisition of Angelo Gordon in November 2023. Interest Expense.
Depreciation and amortization increased by $87.7 million for the year ended December 31, 2024 compared to the year ended December 31, 2023. This change was primarily due to the amortization of intangible assets resulting from the acquisition of TPG Angelo Gordon in November 2023. Interest Expense.
We utilize these measures to assess the unrealized value of our book assets after deducting for book liabilities as well as assess our indirect interest in accrued performance allocations from our TPG funds and our co-investments in TPG funds and third-party investments.
Additionally, the book assets, book liabilities and net book value include the tax assets and liabilities of TPG Inc. We utilize these measures to assess the unrealized value of our book assets after deducting for book liabilities as well as assess our indirect interest in accrued performance allocations from our funds and our co-investments in our funds and third-party investments.
Additional Contingent Obligations As of December 31, 2023 and December 31, 2022, if all investments held by the TPG funds were liquidated at their current unrealized fair value, there would be clawback of $58.3 million related to STAR, net of tax, for which a performance allocation reserve was recorded within other liabilities in the Consolidated Statements of Financial Condition.
Additional Contingent Obligations As of December 31, 2024 and December 31, 2023, if all investments held by the TPG funds were liquidated at their current unrealized fair value, there would be clawback of $5.5 million and $58.3 million, respectively, related to Asia V and STAR, respectively, for which a performance allocation reserve was recorded within other liabilities in the Consolidated Statements of Financial Condition.
(17) Total Returns for onshore funds only. Total Returns for the offshore vehicles were: (i) for the MVP Fund, 11% and (ii) for the Super Fund, 8%. (18) TCAP launched on January 1, 2023. Total Return includes AGTB Private BDC, which commenced operations on May 10, 2022 and merged with TCAP on January 1, 2023.
(18) Total Returns for onshore funds only. Total Returns for the offshore vehicles were: (i) for the MVP Fund, 11%, (ii) for ABC Evergreen, NM and (iii) for the Super Fund, 8%. (19) TCAP launched on January 1, 2023. Total Return includes AGTB Private BDC, which commenced operations on May 10, 2022 and merged with TCAP on January 1, 2023.
For the year ended December 31, 2022, annualized weighted average management fees as a percentage of FAUM, which represent annualized management fees divided by the average of each applicable period’s FAUM, were 1.35%.
For the year ended December 31, 2024, annualized weighted average management fees as a percentage of FAUM, which represent annualized management fees divided by the average of each applicable period’s FAUM, were 1.17%.
Fee-related revenue differs from revenue computed in accordance with U.S. GAAP in that it excludes certain reimbursement expense arrangements. Refer to “—Reconciliation to U.S. GAAP Measures” to the comparable line items on the combined statements of operations. 111 Table of Contents Fee-Related Expenses . Fee-related expenses is a component of FRE.
Fee-related revenues differs from revenue computed in accordance with U.S. GAAP in that it excludes certain reimbursement expense arrangements. Refer to “—Reconciliation to U.S. GAAP Measures” to the comparable line items on the Consolidated Statements of Operations. Fee-Related Expenses . Fee-related expenses is a component of FRE. Fee-related expenses differs from expenses computed in accordance with U.S.
We have built our firm through more than 30 years of successful innovation and growth, and believe that we have delivered attractive risk-adjusted returns to our clients and established a premier investment business focused on the fastest-growing segments of both the alternative asset management industry and the global economy.
We have built our firm through years of successful innovation and growth, and believe that we have delivered attractive risk-adjusted returns to our clients and established a premier investment business focused on the fastest-growing segments of the alternative asset management industry.
During the year ended December 31, 2023, cash used in financing activities primarily reflects the payments of dividends and distributions to our Class A common stockholders and to holders of non-controlling interests in subsidiaries and the redemption of the outstanding YTPG and AFTR Class A Ordinary Shares, which were funded by our Assets held in Trust Account.
Cash used in financing activities during the year ended December 31, 2023 primarily reflects the payments of dividends and distributions to our Class A common stockholders and to holders of non-controlling interests in subsidiaries and the redemptions of the outstanding shares of the Public SPACs, which were funded by our Assets held in Trust Account.
These increases were partially offset by an increase in compensation reimbursements related to services provided to certain fund and portfolio companies of $8.6 million.
These increases were partially offset by an increase in compensation reimbursements related to services provided to certain fund and portfolio companies of $16.1 million.
Fee-related expenses differs from expenses computed in accordance with U.S. GAAP in that it is net of certain reimbursement arrangements and does not include performance allocation compensation. Fee-related expenses is used in management’s review of the business. Refer to “—Reconciliation to U.S. GAAP Measures” to the comparable line items on the combined statements of operations.
GAAP in that it is net of certain reimbursement arrangements and does not include performance allocation compensation. Fee-related expenses is used in management’s review of the business. Refer to “—Reconciliation to U.S. GAAP Measures” to the comparable line items on the Consolidated Statements of Operations.
Transaction, monitoring and other fees, net increased by $3.8 million, or 4%, for the year ended December 31, 2023 compared to the year ended December 31, 2022, primarily attributable to an increase in fees received by our Market Solutions platform as a result of increased capital markets activity among our portfolio companies involving our broker-dealer.
Transaction, monitoring and other fees, net increased by $39.9 million, or 37%, for the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily attributable to an increase in fees received by our Market Solutions platform as a result of increased capital markets activity among our portfolio companies involving our broker-dealer.
Our Liquidity Needs We expect that our primary liquidity needs include cash required to: • support our working capital needs; • fund cash operating expenses, including compensation and contingencies, including for clawback obligations or litigation matters; • service debt obligations, including the payment of obligations at maturity, on interest payment dates or upon redemption, as well as any contingent liabilities that may give rise to future cash payments; • continue growing our businesses, including seeding new strategies, pursuing strategic investments or acquisitions, funding our capital commitments made to existing and future funds and co-investments, funding any net capital requirements of our broker-dealer and otherwise supporting investment vehicles that we sponsor; • pay amounts that may become due under the Tax Receivable Agreement; • pay earnouts and contingent cash consideration associated with our Acquisition; • pay cash dividends in accordance with our dividend policy for our Class A common stock; • warehouse investments in portfolio companies or other investments for the benefit of one or more of our funds or other investment pending contribution of committed capital by the investors in such vehicles and advance capital to them for other operational needs; • risk retention for CLOs • address capital needs of regulated and other subsidiaries, including our broker-dealer; and • exchange Common Units pursuant to the Exchange Agreement or repurchase or redeem other securities issued by us. 152 Table of Contents Contractual Obligations In the ordinary course of business, we enter into contractual arrangements that require future cash payments.
Our Liquidity Needs We expect that our primary liquidity needs include cash required to: • support our working capital needs; • fund cash operating expenses, including compensation and contingencies, including for clawback obligations or litigation matters; • service debt obligations, including the payment of obligations at maturity, on interest payment dates or upon redemption, as well as any contingent liabilities that may give rise to future cash payments; • continue growing our businesses, including seeding new strategies, pursuing strategic investments or acquisitions, funding our capital commitments made to existing and future funds and co-investments, meeting any net capital requirements of our broker-dealer or funding obligations of our capital markets business and otherwise supporting investment vehicles that we sponsor; • pay amounts that may become due under the Tax Receivable Agreement; • pay earnouts and contingent cash consideration associated with our Acquisition; • pay cash dividends in accordance with our dividend policy for our Class A common stock; • warehouse investments or seed portfolios for the benefit of one or more of our funds or other investment vehicles pending the expected contribution of committed capital by the investors in such vehicles and advance capital to them for other operational needs; • manage risk retention for CLOs; • address capital needs of regulated and other subsidiaries, including our broker-dealer; • settle tax withholding obligations in connection with net share settlements of equity-based awards; and 129 Table of Contents • exchange Common Units pursuant to the Exchange Agreement or repurchase or redeem other securities issued by us.
Cash and Cash Equivalents Our consolidated cash and cash equivalents totaled approximately $678.4 million at December 31, 2023. Credit Facilities Senior Unsecured Revolving Credit Facility In March 2011, TPG Holdings, L.P. entered into a $400.0 million credit facility (the “Senior Unsecured Revolving Credit Facility”).
Cash, Cash Equivalents and Restricted Cash Our consolidated cash, cash equivalents and restricted cash totaled approximately $821.2 million at December 31, 2024. Credit Facilities Senior Unsecured Revolving Credit Facility In March 2011, TPG Holdings, L.P. entered into a $400.0 million credit facility (the “Senior Unsecured Revolving Credit Facility”).
Date Declared Record Date Payment Date Dividend per Class A Common Share May 10, 2022 May 20, 2022 June 3, 2022 $ 0.44 August 9, 2022 August 19, 2022 September 2, 2022 0.39 November 9, 2022 November 21, 2022 December 2, 2022 0.26 February 15, 2023 February 27, 2023 March 10, 2023 0.50 Total 2022 Dividend Year $ 1.59 May 15, 2023 May 25, 2023 June 5, 2023 $ 0.20 August 8, 2023 August 18, 2023 September 1, 2023 0.22 November 7, 2023 November 17, 2023 December 1, 2023 0.48 February 13, 2024 February 23, 2024 March 8, 2024 0.44 Total 2023 Dividend Year (through Q4 2023) $ 1.34 Tax Receivable Agreement The future exchanges by owners of Common Units for cash from a substantially concurrent public offering, reorganization or private sale (based on the price per share of the Class A common stock on the day before the pricing of such public offering or private sale) or, at our election, for shares of our Class A common stock on a one-for-one basis (or, in certain cases, for shares of nonvoting Class A common stock) are expected to produce or otherwise deliver to us favorable tax attributes that can reduce our taxable income.
Date Declared Record Date Payment Date Dividend per Class A Common Share May 15, 2023 May 25, 2023 June 5, 2023 $ 0.20 August 8, 2023 August 18, 2023 September 1, 2023 0.22 November 7, 2023 November 17, 2023 December 1, 2023 0.48 February 13, 2024 February 23, 2024 March 8, 2024 0.44 Total 2023 Dividend Year (through Q4 2023) $ 1.34 May 8, 2024 May 20, 2024 June 3, 2024 $ 0.41 August 6, 2024 August 16, 2024 August 30, 2024 0.42 November 4, 2024 November 14, 2024 December 2, 2024 0.38 February 11, 2025 February 21, 2025 March 7, 2025 0.53 Total 2024 Dividend Year (through Q4 2024) $ 1.74 Tax Receivable Agreement The future exchanges by owners of Common Units for cash from a substantially concurrent public offering, reorganization or private sale (based on the price per share of the Class A common stock on the day before the pricing of such public offering or private sale) or, at our election, for shares of our Class A common stock on a one-for-one basis (or, in certain cases, for shares of nonvoting Class A common stock) are expected to produce or otherwise deliver to us favorable tax attributes that can reduce our taxable income.
Factors that could cause or contribute to these differences include, but are not limited to, those identified below and elsewhere in this report, particularly in “Cautionary Note Regarding Forward-Looking Statements,” “Item 1A.—Risk Factors” and “—Unaudited Pro Forma Condensed Consolidated Financial Information and Other Data.” We assume no obligation to update any of these forward-looking statements.
Factors that could cause or contribute to these differences include, but are not limited to, those identified below and elsewhere in this report, particularly in “Cautionary Note Regarding Forward-Looking Statements,” and “Item 1A.—Risk Factors”. We assume no obligation to update any of these forward-looking statements.
Since we only consolidate a limited portion of our TPG investment funds, the performance of the consolidated Public SPACs is not necessarily consistent with or representative of the aggregate performance trends of our TPG investment funds. Key Financial Measures Our key financial and operating measures are discussed below. Revenues Fees and Other .
The performance of the consolidated Public SPACs is not necessarily consistent with or representative of the aggregate performance trends of our TPG investment funds. Key Financial Measures Our key financial and operating measures are discussed below. Revenues Fees and Other .
These non-GAAP financial measures may differ from the calculations of other alternative asset managers and, as a result, may not be comparable to similar measures presented by other companies. Refer to “––Reconciliation to U.S.
These non-GAAP financial measures may differ from the calculations of other alternative asset managers and, as a result, may not be comparable to similar measures presented by other companies. Refer to “ — Reconciliation to U.S. GAAP Measures” for reconciliations of the Consolidated Statements of Financial Condition to the non-GAAP Balance Sheet.
Key drivers consisted of performance allocation and co-investment proceeds totaling $798.5 million and $1,567.7 million for the year ended December 31, 2023 and 2022, respectively. This was partially offset by changes in operating assets and liabilities for the year ended December 31, 2023 and 2022, respectively.
Key drivers consisted of performance allocation and co-investment proceeds totaling $1,460.5 million and $798.5 million for the years ended December 31, 2024 and 2023, respectively. This was partially offset by other changes in operating assets and liabilities for the years ended December 31, 2024 and 2023, respectively.
Interest, Dividends and Other . Interest income is recognized on an accrual basis to the extent that such amounts are expected to be collected using the effective interest method. Dividends and other investment income are recorded when the right to receive payment is established. Net Gains from Investment Activities of consolidated TPG Funds and Public SPACs .
Interest, Dividends and Other . Interest income is recognized on an accrual basis to the extent that such amounts are expected to be collected using the effective interest method. Dividends and other investment income are recorded when the right to receive payment is established. 93 Table of Contents Investment and Other Income of Consolidated Public SPACs.
As of December 31, 2023, our total liquidity was $1,544.2 million, comprised of $665.2 million of cash and cash equivalents, excluding $13.2 million of restricted cash, as well as $699.0 million and $30.0 million of incremental borrowing capacity under the Senior Unsecured Revolving Credit Facility and the Subordinated Credit Facility (each as defined herein), respectively and $150.0 million of the 364-day revolving credit facility.
As of December 31, 2024, our total liquidity was $2,136.0 million, comprised of $808.0 million of cash and cash equivalents, excluding $13.2 million of restricted cash, as well as $1,200.0 million and $30.0 million of incremental borrowing capacity under the Senior Unsecured Revolving Credit Facility and the Subordinated Credit Facility (each as defined herein), respectively and $98.0 million under the 364-Day Credit Facility.
Net IRR is the discount rate at which (i) the present value of all capital contributed by investors to the fund (which excludes, for the avoidance of doubt, any amounts borrowed by the fund in lieu of calling capital) is equal to (ii) the present value of all cash distributed to investors and the investors’ ending capital balances. 148 Table of Contents (9) Net MoM represents the multiple-of-money on contributions to the fund by investors.
Net IRR is the discount rate at which (i) the present value of all capital contributed by investors to the fund (which excludes, for the avoidance of doubt, any amounts borrowed by the fund in lieu of calling capital) is equal to (ii) the present value of all cash distributed to investors and the investors’ ending capital balances.
During January 2024, we drew $58.5 million under our Senior Unsecured Revolving Credit Facility. 150 Table of Contents Senior Unsecured Term Loan In December 2021, we entered into a credit agreement (the “Senior Unsecured Term Loan Agreement”) pursuant to which the lenders thereunder agreed to make term loans in a principal amount of up to $300.0 million during the period commencing on December 2, 2021 and ending on the date that is 30 days thereafter.
Senior Unsecured Term Loan In December 2021, we entered into a credit agreement (the “Senior Unsecured Term Loan Agreement”) pursuant to which the lenders thereunder agreed to make term loans in a principal amount of up to $300.0 million during the period commencing on December 2, 2021 and ending on the date that is 30 days thereafter.
The Company entered into an equity commitment letter in connection with the 364-Day Credit Facility, committing to provide capital contributions, if and when required, to the consolidated subsidiary throughout the life of the facility.
The Company entered into an equity commitment letter in connection with the 364-Day Credit Facility, committing to provide capital contributions, if and when required, to the consolidated subsidiary throughout the life of the facility. In April 2024, the consolidated subsidiary amended the 364-Day Credit Facility to extend the commitment termination date to April 11, 2025.
During the year ended December 31, 2023, the subsidiary did not borrow or make repayments on the Subordinated Credit Facility, resulting in a zero balance outstanding at December 31, 2023. 364-Day Credit Facility On April 14, 2023, a consolidated subsidiary of the Company entered into a 364-day revolving credit facility (the “364-Day Credit Facility”) with Mizuho Bank, Ltd., acting as administrative agent, to provide the subsidiary with revolving borrowings of up to $150.0 million.
During the year ended December 31, 2024, the subsidiary borrowed and made repayments of $60.0 million on the Subordinated Credit Facility, resulting in a zero balance outstanding at December 31, 2024. 128 Table of Contents 364-Day Credit Facility On April 14, 2023, a consolidated subsidiary of the Company entered into a 364-day revolving credit facility (the “364-Day Credit Facility”) with Mizuho Bank, Ltd., acting as administrative agent, to provide the subsidiary with revolving borrowings of up to $150.0 million.
During the year ended December 31, 2023, the subsidiary borrowed and made repayments of $150.0 million on the 364-Day Credit Facility, resulting in a zero balance outstanding at December 31, 2023.
During the year ended December 31, 2024, the subsidiary borrowed $270.0 million and made repayments of $218.0 million on the 364-Day Credit Facility, resulting in a $52.0 million balance outstanding at December 31, 2024.
The potential liquidation of STAR could require clawback payments. Additionally, if all remaining investments were deemed worthless, a possibility management views as remote, the amount of performance allocations subject to projected clawback as of December 31, 2023 and December 31, 2022 would be $1,910.2 million and $1,869.4 million, respectively.
Additionally, if all remaining investments were deemed worthless, a possibility management views as remote, the amount of performance allocations subject to potential clawback as of December 31, 2024 and December 31, 2023 would be $2,140.4 million and $1,910.2 million, respectively.
Realized Investment Income and Other, Net The following table presents realized investment income and other, net for the years ended December 31, 2023 and 2022: Year Ended December 31, 2023 2022 ($ in thousands) Investments in TPG funds $ 27,543 $ 82,174 Non-core income (expense) (74,784) (40,136) Total Realized Investment Income and Other, Net $ (47,241) (1) $ 42,038 ___________ (1) Includes amounts from TPG Angelo Gordon from November 1, 2023, the date of the Acquisition, through December 31, 2023.
Realized Investment Income and Other, Net The following table presents realized investment income and other, net for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 ($ in thousands) Investments in funds $ 27,882 $ 27,543 Non-core income (expense) (35,585) (74,784) Total Realized Investment Income and Other, Net $ (7,703) $ (47,241) (1) ___________ (1) Includes amounts from TPG Angelo Gordon from November 1, 2023, the date of the Acquisition, through December 31, 2023.
Performance Generating AUM totaled $150.8 billion and $85.3 billion as of December 31, 2023 and December 31, 2022, respectively. Across the investment funds that we manage, Performance Eligible AUM totaled $191.8 billion and $121.0 billion as of December 31, 2023 and December 31, 2022, respectively.
Performance Generating AUM totaled $163.4 billion and $150.8 billion as of December 31, 2024 and December 31, 2023, respectively. Across the investment funds that we manage, Performance Eligible AUM totaled $209.3 billion and $191.8 billion as of December 31, 2024 and December 31, 2023, respectively.
We are subject to U.S. federal and state income taxes, in addition to local and foreign income taxes, with respect to our allocable share of taxable income generated by the TPG Operating Group partnerships.
Income Tax Expense The Company is treated as a corporation for U.S. federal and state income tax purposes. We are subject to U.S. federal and state income taxes, in addition to local and foreign income taxes, with respect to our allocable share of taxable income generated by the TPG Operating Group partnerships.
Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 Fee-Related Revenues Fee-related revenues increased by $251.2 million, or 23%, for the year ended December 31, 2023 compared to the year ended December 31, 2022.
Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Fee-Related Revenues Fee-related revenues increased by $494.2 million, or 37%, for the year ended December 31, 2024 compared to the year ended December 31, 2023.
Fair Value of Investments or Instruments that are Exchange Traded Securities that are exchange traded and for which a quoted market exists will be valued at the closing price of such securities in the principal market in which the security trades, or in the absence of a principal market, in the most advantageous market on the valuation date.
TPG is required to measure certain financial instruments at fair value, including equity securities and derivatives. 134 Table of Contents Fair Value of Investments or Instruments that are Exchange Traded Securities that are exchange traded and for which a quoted market exists will be valued at the closing price of such securities in the principal market in which the security trades, or in the absence of a principal market, in the most advantageous market on the valuation date.
This change was primarily driven by a $9.6 million increase in transaction fees earned from portfolio companies in our Real Estate and Capital platforms and a $5.1 million increase in our Market Solutions platform as a result of increased capital markets activity among our portfolio companies involving our broker-dealer. Expense Reimbursements and Other .
This change was primarily driven by a $42.0 million increase in our Market Solutions platform as a result of increased capital markets activity among our portfolio companies involving our broker-dealer and a $18.8 million increase in monitoring fees earned from portfolio companies primarily in our Capital platform. Expense Reimbursements and Other .
As of December 31, 2023 and December 31, 2022, we had guarantees outstanding totaling $73.6 million and $100.8 million, respectively, related to employee guarantees primarily related to a third-party lending program which enables certain of our eligible employees to obtain financing for co-invest capital commitment obligations with a maximum potential exposure of $176.3 million and $163.7 million, respectively. 153 Table of Contents Dividends The table below presents information regarding the quarterly dividends on the Class A common stock, which were made at the sole discretion of our Executive Committee and Board of Directors.
As of December 31, 2024 and December 31, 2023, we had guarantees outstanding totaling $137.5 million and $73.6 million, respectively, related to a third-party lending program that enables certain of our eligible employees to obtain financing for capital contributions into TPG funds with a maximum potential exposure of $192.9 million and $176.3 million, respectively. 130 Table of Contents Dividends The table below presents information regarding the quarterly dividends on the Class A common stock, which were made at the sole discretion of our Executive Committee and Board of Directors.
Distributable Earnings The decrease in DE for the year ended December 31, 2023 compared to the year ended December 31, 2022 was primarily due to lower realized performance allocations, net, partially offset by a 34% increase in our Fee-Related Earnings.
Distributable Earnings The increase in Distributable Earnings for the year ended December 31, 2024 compared to the year ended December 31, 2023 was primarily due to a 26% increase in our Fee-Related Earnings and an increase in realized performance allocations, net, partially offset by an increase in interest expense, net.
AUM Subject to Fee Earning Growth AUM Subject to Fee Earning Growth represents capital commitments that when deployed have the ability to grow our fees through earning new management fees (AUM Not Yet Earning Fees) or when management fees can be charged at a higher rate as capital is invested or for certain funds as management fee rates increase during the life of a fund (FAUM Subject to Step-Up).
AUM Subject to Fee Earning Growth AUM Subject to Fee Earning Growth represents capital commitments that when deployed have the ability to grow our fees through earning new management fees (AUM Not Yet Earning Fees) or when management fees can be charged at a higher rate as capital is invested or for certain funds as management fee rates increase during the life of a fund (FAUM Subject to Step-Up). 116 Table of Contents AUM Not Yet Earning Fees represents the amount of capital commitments to TPG’s funds and co-investment vehicles that has not yet been invested or considered active, and as this capital is invested or activated, the fee-paying portion will be included in FAUM.
Capital allocation-based income (loss) is earned from the TPG funds when we have (i) a general partner’s capital interest and (ii) performance allocations which entitle us to a disproportionate 95 Table of Contents allocation of investment income or loss from investment funds.
These termination payments are recognized in the period in which the related transaction closes. 92 Table of Contents Capital Allocation-Based Income (Loss) . Capital allocation-based income (loss) is earned from our funds when we have (i) a general partner’s capital interest and (ii) performance allocations which entitle us to a disproportionate allocation of investment income or loss from investment funds.
Distributions of performance allocations in the legal form of equity made directly or indirectly to our partners and professionals are allocated and distributed, when realized, pro rata based on ownership percentages in the underlying investment partnership and are accounted for as distributions on the equity held by such partners rather than as compensation and benefits expense prior to the Reorganization and IPO.
Distributions of performance allocations in the legal form of equity made directly or indirectly to our partners and professionals are allocated and distributed, when realized, pro rata based on ownership percentages in the underlying investment partnership.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAn 159 Table of Contents immediate, hypothetical 10% decline in the fair value of investments would result in a decrease of performance allocations totaling $1,900.6 million, or $335.9 million net of accrued performance allocation compensation and other allocations. Effect on Investment Income Investment income is earned from our investments in TPG funds and other investments.
Biggest changeAn immediate, hypothetical 10% decline in the fair value of investments would result in a decrease of performance allocations totaling $2,101.7 million, or $394.7 million net of accrued performance allocation compensation and other allocations. Effect on Investment Income Investment income is earned from our investments in TPG funds and other investments.
We generally endeavor to minimize our risk of exposure by limiting the counterparties with which we enter into financial transactions to reputable financial institutions. In other circumstances, availability of financing from financial institutions may be uncertain due to market events, and we may not be able to access these financing markets. 160 Table of Contents
We generally endeavor to minimize our risk of exposure by limiting the counterparties with which we enter into financial transactions to reputable financial institutions. In other circumstances, availability of financing from financial institutions may be uncertain due to market events, and we may not be able to access these financing markets. 138 Table of Contents
The majority of our TPG funds are USD denominated and have functional currency in the USD. As such, our management fees are not significantly impacted by fluctuations in exchange rates. Interest Rate Risk Interest rate risk represents exposure we have to instruments whose values vary with the change in interest rates.
The majority of our TPG funds are USD denominated and have functional currency in the USD. As such, our management fees are not significantly impacted by fluctuations in exchange rates. 137 Table of Contents Interest Rate Risk Interest rate risk represents exposure we have to instruments whose values vary with the change in interest rates.
Key investment decisions are subject to approval by the investment committee, which generally includes one or more of the key members of management, one product leader, and one or more advisors and senior investment professionals associated with that particular fund.
Key investment decisions are subject to approval 136 Table of Contents by the investment committee, which generally includes one or more of the key members of management, one product leader, and one or more advisors and senior investment professionals associated with that particular fund.
An immediate, hypothetical 10% decline in the fair value of investments would result in a decrease of investment income totaling $91.7 million. Exchange Rate Risk Our investment funds hold investments that are denominated in non-USD currencies that may be affected by movements in the rate of exchange between the USD and non-USD currencies.
An immediate, hypothetical 10% decline in the fair value of investments would result in a decrease of investment income totaling $120.1 million. Exchange Rate Risk Our investment funds hold investments that are denominated in non-USD currencies that may be affected by movements in the rate of exchange between the USD and non-USD currencies.
Based on our debt obligations payable as of December 31, 2023, we estimate that interest expense relating to variable-rate debt would increase by approximately $2.9 million on an annual basis in the event interest rates were to have been one percentage point during the period.
Based on our debt obligations payable as of December 31, 2024, we estimate that interest expense relating to variable-rate debt would increase by approximately $1.6 million on an annual basis in the event interest rates were to have been one percentage point during the period.
We estimate that as of December 31, 2023, if the USD strengthened 10% against all foreign currencies, the impact on our consolidated results of operations for the year then ended would be as follows: (a) performance allocations would decrease by $446.3 million, or $59.9 million net of accrued performance allocation compensation and other allocations and (b) net gains from investments would decrease by $22.5 million.
We estimate that as of December 31, 2024, if the USD strengthened 10% against all foreign currencies, the impact on our consolidated results of operations for the year then ended would be as follows: (a) performance allocations would decrease by $318.0 million, or $51.8 million net of accrued performance allocation compensation and other allocations and (b) net gains from investments would decrease by $23.1 million.

Other TPG 10-K year-over-year comparisons