KBRA Publishes Ratings for StepStone Group LP

KBRA publishes the issuer and senior unsecured ratings of A+ for StepStone Group LP ("StepStone" or "the firm"). These ratings were assigned on an unpublished basis on September 9, 2024 and subsequently affirmed on September 9, 2025. The rating Outlook is Stable.

Key Credit Considerations

The ratings are supported by StepStone’s solid performance and strong fundraising track record, which have driven consistent growth in asset under management (AUM), assets under advisement, revenues, and EBITDA. Expanding private market allocations by institutional investors and increasing participation from retail investors are expected to sustain long-term asset growth and related fee income. StepStone has expanded both organically and through strategic acquisitions, adding talent and AUM in targeted asset classes. Since inception, StepStone’s management of private equity portfolios and extensive client relationships have built a proprietary database spanning 50 years of private market history, covering general partners, funds, and investments. This information edge enables the firm to consistently identify top managers and funds, supporting its strong investment performance. The investor and client base is diverse by type, geography, and size, with many longstanding relationships spanning multiple funds. The leadership team includes key executives with deep industry experience and extensive sector knowledge, while firm employees have significant fund co-investments, ensuring strong alignment of interests between management and investors and fostering a conservative, long-term approach to investing. Revenues and EBITDA benefit from a high level of management fees, which have been growing, combined with a solid track record of realized carry generation based on a large, diversified pool of carried interest. Management fees are highly predictable and recurring in nature, while a variable cost structure allows for cost reductions in a down market. Leverage and interest coverage are forecast to remain at conservative levels, recognizing that there can be some variability in carry and EBITDA, particularly from quarter to quarter.

Rating Sensitivities

Given the Stable rating Outlook, an upgrade is not expected over the intermediate term. Over the longer term, there is potential for upward rating momentum if management achieves additional AUM and revenue growth and diversification by fund strategy with stronger fee level mix, generates EBITDA growth in line with forecasted levels, and maintains conservative leverage metrics. The ratings could become pressured in the event of an unforeseen decline in AUM or other financial issues which result in lower fee generation and cash flow. Materially higher than expected leverage metrics could also lead to negative rating implications.

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Methodologies