Michael Woolhouse

net or better.

That is, I think, what buyers in this market, and we would be part of that, are targeting for our investors at a deal level.

So to that end, that gives you some insight into what the general partner sees ahead of them.

When you look at them, the incentives, like do they really believe it, is an important question because we have to make our judgments.

In a typical CV deal, if you sort of think about it,

The general partner has the opportunity to take five times the money off the table.

That means a very meaningful carry check plus realizing five times on their GP commitment, their GP co-invest.

And they're making a proactive choice not to do that.

And, and.

If you really truly have that choice today, in other words, you could sell the business if you wish to, but you're choosing not to, when you put that money back on the table, in these deals, sponsors tend to roll 100% of the proceeds from the sell side of the deal.

The only way that's economically rational

is if they really believe that there is another three to four times the money from here.

And I think that range is generally speaking what the sponsor would say is on offer.

Most buyers would bring a skeptical lens to that and be more conservative in how they underwrite.

But I think as an upside case, that is certainly what most buyers in our market are looking for and more conservatively underwrite the investment into the 2X 20% range that I described.

This is still a relatively nascent market.

So we have yet to see a large number of realizations proving out what I just said.

That having been said, there are reports, industry reports that both Evercore and Morgan Stanley, those two groups in particular, put out there on a regular basis.

And what they have concluded so far as they look across the market is that continuation vehicles offer returns as high, if not higher than buyout.

with lower risk as measured by lower loss ratios.