Cliffwater Company Profile

Background

Founded in 2004, Cliffwater LLC is an independent alternative investment adviser and fund manager dedicated to assisting investors in achieving their long-term objectives through alternative investments. The firm emphasizes integrity, innovation, and a commitment to advancing the alternatives landscape.

Key Strategic Focus

Cliffwater specializes in providing research, advisory services, and asset management across various alternative investment classes, including private debt, private equity, real estate, and real assets. The firm is renowned for its proprietary research and innovative fund offerings, aiming to enhance how both institutional and individual investors access private markets.

Financials and Funding

As of March 2025, Cliffwater manages approximately $29 billion in assets under management (AUM) and advises on an additional $83 billion in assets. The firm's revenue is estimated to be around $36 million annually, with a revenue per employee of approximately $231,000.

Pipeline Development

Cliffwater has developed several key investment funds:

Cliffwater Corporate Lending Fund (CCLFX): Launched in June 2019, CCLFX focuses on corporate middle market direct lending. As of July 31, 2024, it has over $21.2 billion in net assets and approximately $26.3 billion in total gross assets.

Cliffwater Enhanced Lending Fund (CELFX): Introduced in July 2021, CELFX invests across the private debt spectrum, including niche strategies. As of June 30, 2024, CELFX has $3.4 billion in net asset value and approximately $3.7 billion in total gross assets.

Cascade Private Capital Fund (CPEFX): In 2024, Cliffwater became the investment adviser of CPEFX, restructuring it as the first daily NAV, ticker symbol executed, comprehensive private capital interval fund.

Technological Platform and Innovation

Cliffwater distinguishes itself through several proprietary technologies and methodologies:

Cliffwater Direct Lending Index (CDLI): Established in 2015, CDLI is the first published direct lending index and serves as a widely accepted benchmark for the asset class.

Proprietary Research: The firm publishes industry-shaping research, including works by CEO Stephen Nesbitt, such as "Private Debt: Opportunities in Corporate Direct Lending" (2019) and its second edition, "Private Debt: Yield, Safety and the Emergence of Alternative Lending" (2023).

Leadership Team

Stephen Nesbitt: CEO and CIO, founder of Cliffwater in 2004. Recognized as one of the "30 Most Influential People in Private Debt" by Private Debt Investor in 2018.

Blake Nesbitt: Co-Head of Asset Management. Recognized as a Rising Star by Private Debt Investor in 2024.

Philip Huber: Head of Portfolio Solutions, joined in January 2024 to strengthen leadership in alternatives research and product for the wealth management channel.

Timothy Henn: Managing Director and Head of Private Equity Secondaries, joined in July 2024 to expand the firm's capabilities in private equity secondaries.

Leadership Changes

Recent significant appointments include:

Philip Huber: Appointed as Head of Portfolio Solutions in January 2024.

Timothy Henn: Appointed as Managing Director and Head of Private Equity Secondaries in July 2024.

Competitor Profile

Market Insights and Dynamics

The alternative investment industry has experienced significant growth, with increasing interest from both institutional and individual investors seeking diversification and enhanced returns. Cliffwater's focus on private debt and innovative fund structures positions it well within this expanding market.

Competitor Analysis

Key competitors include:

Lazard: A global financial advisory and asset management firm.

Apex Fund Services: Provides portfolio valuations and fund administration services.

ICICI Prudential: Offers a range of financial solutions.

Wellington Management Group: Provides investment management services.

Strategic Collaborations and Partnerships

Virtus Investment Partners: In 2013, Cliffwater partnered with Virtus to offer liquid alternative investments, establishing Cliffwater Investments LLC to subadvise a series of multi-strategy, multi-manager alternative mutual funds for retail investors.

TCG BDC: In 2020, Cliffwater formed a joint venture with TCG BDC to create Middle Market Credit Fund II LLC, enhancing balance sheet flexibility and capital deployment into attractive origination environments.

Operational Insights

Cliffwater's strategic focus on private debt and its development of proprietary indexes like the CDLI provide a competitive edge. The firm's commitment to research and innovation, coupled with strategic partnerships, enhances its market position and ability to deliver value to clients.

Strategic Opportunities and Future Directions

Cliffwater aims to continue expanding its offerings in private debt and alternative investments, leveraging its research capabilities and strategic partnerships. The firm is positioned to capitalize on the growing demand for alternative investment solutions among both institutional and individual investors.