The State of Wisconsin Investment Board has hired StepStone Group as an advisor to identify nontraditional private equity sectors where the state has not yet invested, but which are well positioned for the next fund cycle. StepStone, based in La Jolla, Calif., is expected to advise Wisconsin on commitments in $50 million increments.
“We’ll be looking more at smaller size funds, $750 million and under,” says StepStone CEO Monte Brem. Some of the areas Brem has his eye on are specialized distressed debt strategies, international markets, infrastructure and possible hybrid strategies involving private equity firms and hedge funds.
Scott Parish, Wisconsin’s private equity portfolio manager, singled out StepStone’s analytical approach to due diligence—the way the firm breaks down in detail how a particular fund has generated its returns—as one of the factors that put StepStone over the top. StepStone also advises the Los Angeles Fire and Police Pension System on its private equity program, among other clients.
The Wisconsin Investment Board invests the assets of the $87 billion Wisconsin Retirement System and on behalf of the Wisconsin State Investment Fund and other Wisconsin trust funds. The board manages $93 billion in assets.
The state has been investing in private equity since 1985, and has a target allocation of 5% to the asset class. —Joshua Payne