But like I say, I can’t predict. On the comp ratio point of view, yeah, we don’t provide specifics on compensation, but as you say, it differs by product. And obviously, there’s also discretionary elements in there. And – but remember that comp has deferrals in it. So some of the performance fees that we’ve recognized in 2023 has some tail into the future years as those comp deferrals come through. But again, that’s all built into guidance. It’s built into the table on LTI that we’ve given you at the back of the deck. So again, you can see that, and that’s built into that that lower comp guidance for 2024.
Operator: Our next question comes from John Dunn of Evercore ISI. John, please go ahead.
John Dunn: Thank you. Could you just frame how much cash is available cash? And then you mentioned seating, but just maybe a quick force rank of the rest of the capital management hierarchy.
Roger Thompson: Hey, John. So, yes, cash as it looks is about $1 billion. But within that there is a piece of rate capital and a piece of working capital that we need. So there is probably – it’s a few hundred million dollars of, you could call it surplus cash that we really have. In terms of seed, as I said, that’s also baked into that chart on Slide 12. And I said, if anything, that we’ll harvest some this year. We’ll invest some more that may go up a little bit in 2024. And then the hierarchy of needs, if you like, from a capital point of view, is very – hopefully very well understood. At Janus Henderson, we have rate [ph] capital that we need. We hold capital asides for other things. And then there’s really investment in the business, which is really, in this business, is either seed capital, which we talked about or M&A.
And if there isn’t an immediate need for cash for any of those benefits, we’d then consider returning excess cash to shareholders. And you’ve seen that over the last or since 2018, we’ve reduced the share count by 18.5%. So again, that, that hopefully is very well understood. We follow that pretty religiously.
John Dunn: Yes, I think you’re right. And then just maybe sometimes we skip over. But the Privacore relationship, can you just fill in a little more about it and just some of the milestones we should be looking for over the next two years?
Ali Dibadj: Sure. Look, we’re very excited about this relationship we have with Privacore. Just as a reminder, because we haven’t talked about it a lot as you say. It fills a really big need in the value chain for privates. You have a set of GPs [ph] who selectively have extraordinarily good performance and want to get access to the wealth channel, but can’t service that channel. These are not small GPs. These are some of the larger GPs as well. They’re not the top six or seven private GPs in the world. It’s really difficult for them to reach that channel with the right levels of service and understanding of products, et cetera. And then you have the wealth channel, wirehouses, RIAs, others who want to have access to differentiated, higher performing products than the kind of behemoth that are out there but can’t get access to them because they know that their advisors won’t be serviced and their clients won’t be serviced.
And so Privacore sits at that Nexus and really closes that gap of needs between those two pieces of the value chain. And we’ve been, I guess, surprised, maybe the wrong word, but pleased about the level of interest that we’ve had from both sides of that Nexus both the clients as well as the GPs, to broaden that relationship. So we’re pretty optimistic about that. We’ve talked about the market opportunity a little bit, but just to give you a sense of it, remember that this is a largely under allocated part of the wealth channel. The expectations are that, depending on who you’re talking to, 3 to 5x current allocations is what you should expect over the next, call it 5-ish to 10-ish years. And that suggests there’s trillions and trillions of dollars of opportunity here that we would love to be a part of as Janus Henderson to leverage our brand and our intermediate relationships along that way.
And that’s how we work with Privacore. We have a milestone, which is this quarter to launch our first product with Privacore in the channel. That seems to be going well, we look forward to giving you more details about what that product is and the successes of that product we hope on the – over the next earnings calls. We’re not quite there to talk about it publicly at this point.
Operator: Our final question comes from Bill Katz of TD Cowen. Bill, please go ahead.
Bill Katz: Thank you very much and thank you for taking the questions. So, Ali, just to sort of circle back, certainly great progress under your helm stewardship as you think about where we are in terms of the flow trajectory of sort of becoming more sustained to the positive. What’s sort of the timeline from here and the reason I’m asking, just so listening to all your commentary as well as reaction to QA, it really seems like passive and fixed income are the primary areas of growth. And just trying to understand like when do you think you can get to more of a positive net organic growth rate. Thank you.
Ali Dibadj: Look, it’s a step at a time. We think we’re definitely again, squarely on the right path. You’re seeing real improvements across the Board. You’re absolutely right, Bill, to point out that they’ve been so far focused on areas that are not yet on the equity side of things or the higher fee rate side of things overall. But as you can imagine, that’s certainly an area of focus for us. It’s tough for me to give you the timing for it. Look, we’re ahead of plan today, but I wouldn’t anticipate again the same type of results as in 2023 from a flow perspective in 2024. What we see from external expectations perspective is probably roughly in the right realm of things. But we’ll get some more sense of it as the year goes on. Improvement is clearly there, tons of progress is clearly there. And we’re not blind to exactly trying to broaden the success across broader piece of our palette of products, channels, geographies, et cetera.
Bill Katz: Okay. Just a follow-up, another big picture for you. Just as you think through the M&A model from here, and obviously you have great experience in your previous role, what is the right model in your mind? Just given sort of the blurring between traditional managers and alternative managers. You’ve mentioned insurance a couple of times. Is an Apollo or KKR model intriguing to you? Is a Blackstone model intriguing to you? Or is it more of some of your contemporary peers that are much larger in terms of traditional platform that sort of make the most sense in your mind? Thank you.
Ali Dibadj: Given the successes that Blackstone and Apollo have had, it certainly is something that’s intriguing to us on behalf of our shareholders and delivering for client results. We are open minded to how we can grow this business, again on behalf of shareholders and clients. We don’t close doors. We have a priority list of things which, again, some of which you’ve mentioned, some which we’ve talked about, some which you’ve seen our recent successes in different vehicles, for example. So we do have a priority list, but we’re not blind to opportunities that may arise that are more opportunistic in nature that we might want to tackle. Again, we’re going to continue to be very, very disciplined on culture, on valuation, our potential for growth, and most importantly, very, very client led in the way we bring things in-house or partner with different entities.
Operator: With that, I’ll hand back to the team for any closing remarks.
Ali Dibadj: Look, thanks, Jordan. Janus Henderson, at this point in this transformation is feeling squarely like we’re on the right path. We’re making tons of progress ahead of our expectations. I still don’t think we’re at our destination yet. So there’s lots of potential for shareholders, employees and other stakeholders and clients. And hopefully, this quarter starts to manifest some of those proof points. So thank you all for your interest in Janus Henderson today and have a nice rest of the day.
Operator: Ladies and gentlemen, this concludes today’s call. Thank you for joining. You may now disconnect your lines.
