Scott Beiser: Thanks a lot. So on the synergies between, obviously, we have a very large sponsor, set of sponsor relationships, and we do believe that our ability to offer them an integrated solution of advice ranges from primary, secondaries, directs, GP stakes, LP stakes, and financings in general is something that we really are feeling very good about the opportunity that lies ahead. Obviously, we need to execute on that, but we are feeling very good about that. In terms of the contribution of that particular group, that’s not something that we disclose.
James Yaro: Okay. Thanks a lot.
Operator: [Operator Instructions] We’ll go next now to Ryan Kenny with Morgan Stanley.
Ryan Kenny: Hi, good afternoon. So my question is on the M&A environment, specifically the comment in the press release around being realistic on the pace of recovery and the sluggish M&A environment. Can you just unpack that a bit? Is the realism more around the size of the pipeline? Is it more around the timing of the lag? Is it more around sponsors and strategics? Any color that would be helpful?
Scott Beiser: Yes, I think we did purposely think about the words that we wanted to use. We don’t believe that we are in a robust environment like we were probably a couple years ago, or else we’re not in a depressant environment. We’ve been kind of slugging it along. I’d say for the last year or two, we’ve continued to actually be able to grow the business in terms of headcount, in terms of quality of clients, in terms of number of mandates that were engaged on kind of average size. Everything is making, I would say, slow but sure progress. The one thing that we continually discussed that we could snap our fingers and change would probably be the time frame from when you get hired, when you get started on a mandate, and when you close it.
It is still taking longer than what we think is the normal time period. But almost all the measures that we look at are more positive today than they were a year or two ago. And we’re not yet in a robust environment. And when we think we are, I guess we’ll describe that to you as well. But we’re not where we were a year ago, when I think we kind of called the bottom and said that it was about as negative as the environment that we had seen.
Lindsey Alley: But Ryan, another way to think about it is the commentary was more macro than micro. I think us and probably many of our peers have seen activity levels improved, have seen reasonable momentum in their business. And yet we have this sluggish macro environment that makes deals getting closed much harder. And so, hard for us to control that, and so we are, and I think most of us thought we would have come out of it months or quarters ago. And it’s just taken longer than I think any of us expected. So I think we’re just being realistic that this year, things going to look better than last year, but is anyone’s guess just given the macro environment.
Ryan Kenny: On the macro, the Fed Fund Futures curve has moved meaningfully since the last call when the curve was pricing in six rate cuts this year. Now we’re at one or two. How are your clients thinking about that change? Is it having any impact on the pipeline or not really because there aren’t any hikes priced on?
Lindsey Alley: Yes, I mean, really it has been, I’ve said this many times, much more about the availability of capital than the cost of that capital. And today, capital is very available to our clients. And people are actually being aggressive about deploying it. That is a good thing. In terms of pricing, it obviously makes a difference in valuations, but it is really in terms of activity levels is much more about the availability than the cost of it.
Ryan Kenny: Great, thank you.
Operator: We’ll go next now to Steven Chubak of Wolfe Research.
Brendan O’Brien: Good afternoon. This is Brendan O’Brien filling in for Steven. I guess to start, so I’ll touch on sponsors. While activity has been subdued for much of the past couple years, one dynamic that is apparent from the data or publicly available data is that called one billion plus activity has been much stronger, more resilient relative to midcap. Know that you tend to be more focused on midcap activity, but just wanted to get a sense as to what might be driving this divergence and trends between these two buckets.
Scott Beiser: Yes. I think the way that we think about it is that globally there are a tremendous number of deals that take place around the world, and the vast, vast preponderance of those are midcap, and we still have a very small market share of that overall number of deals. And the fact that a relatively small handful of large-cap deals are getting done doesn’t impact the overall denominator, if you will, of the total number of M&A deals. And we are much more focused on total volume of deals than we are deal value in any given period of time.
Scott Beiser: And I think that’s probably the key point that we’d always want to make the press, at times maybe investors or the analysts, you’re focused on the dollar value of announced or completed transactions, and it sways your view of what may be more or less healthy in the marketplace. We’re much more focused on the number of transactions that gets done, and that has probably more of a trending importance to us. So, we don’t actually see or experience what you maybe describe, which is, at this juncture any meaningful difference between the healthiness, buoyancy, whatever you want to call it, of the larger-cap deals versus the mid-cap deals.
