Paul Taubman: Look, I think it is — clearly it’s a mixed bag. I can sit here and I could take a picture and talk about green shoots. And at all the reasons to be optimistic, I could also talk about the reasons why that may not come to fruition. I think the reality is, we’re dealing with a very challenging environment to get transactions done. Let’s just take antitrust, I think while there have been some well publicized victories, the fact remains that this administration is still committed to active enforcement. And as a result, it puts businesses at risk because of an extended periods of time between signing and closing and in a volatile macroeconomic backdrop, putting companies and targets in the crosshairs for a longer period of time, when they’re not integrated and they’re not yet acquired, and they’re just sort of sitting out there that has risk.
And that makes it more difficult for companies to get comfortable. So the mere fact that there is uncertainty, the mere fact that there is longer periods of time, between signing and closing, the fact that there are more regulatory jurisdictions around the globe, with many different agendas, and opportunities for intermediators were to get caught up in a broader geopolitical test of wills, that just weigh in on transactions. That doesn’t mean that it precludes all transactions, it just means at the margin, some transactions that would otherwise be presented to the market as a great deal never see the light of day. I think there’s no doubt that private equity firms are looking to create more monetization events with portfolio companies. As the IPO markets hopefully, open up a bit and one of the challenges will be just the sheer number of companies that would like to access the IPO market, that’s why you’re seeing greater interest and execution with fund continuation vehicles and the like as you look for ways to create more liquidity for companies.
Committed financing continues to be challenging for very large transactions, but you’re then seeing the growth in pools of private capital and direct lenders and more creative deal making. So we’re adjusting to this environment. But what gives me the most confidence is the simple fact that no matter how difficult it is to get deals done, companies’ desires to try and figure out a way to present deals and to move forward and the fact that we have an ever growing backlog of strategic initiatives that have not yet been able to be acted upon I think, is an accelerant. And as soon as some of these conditions, and some of these clouds start to lift, you could see a very strong movement activity to the upside. So we’re controlling what we control, which is making sure we have the right team on the field, making sure we have the right culture to get our team aligned with clients, making sure we have the right priorities, and trying to secure as many high quality mandates as possible.
So even if we don’t have as much as we’d like to present to our investors, on a quarterly basis, we’re at least positioning ourselves for the inevitable turn. And when it does, hopefully, that will be reflected in in stronger results.
Brian O’Brien: Thanks for taking my question.
Paul Taubman: Thank you.
Operator: Thank you. Our next question will come from Brennan Hawken with UBS. Please go ahead. And Brennan, your line is live. Please unmute, if you’re muted.
Brennan Hawken: Okay, sorry about that. Thanks for taking my questions. I wanted to start, Paul, with your expectation for the recruiting to continue to pressure margins. When you say that is that incremental pressure versus what you have been generating more recently or is that more saying that the pressure that you’ve seen recently will continue just trying to understand the implication there?
Paul Taubman: Well, I think it’s — I think I wouldn’t be telling you anything, you weren’t already aware of it saying that the current margins are lower than what they’ve been historically. And we would like to get back to where the margins were historically, but as long as we’re dealing with a subdued environment, and elevated recruiting, our ability to get back to those margins will be pressured.
