Investments

6 Months Ended

Sep. 30, 2021

Equity Method Investments and Joint Ventures [Abstract]

The Company’s investments consist of equity method investments primarily related to investments in the StepStone Funds for which it serves as general partner or managing member but does not have a controlling financial interest. The Company’s equity interest typically does not exceed 1% in each fund. The Company’s share of the underlying net income or loss attributable to its equity interest in the funds is recorded in investment income in the condensed consolidated statements of income. Investment income attributable to investments in certain legacy Greenspring funds for which the Company has no economic interest are recorded in legacy Greenspring investment income in the condensed consolidated statements of income.

The Company’s equity method investments consist of the following:


	As of
	September 30, 2021		March 31, 2021
Investments in funds	$	90,325	$	74,379
Accrued carried interest allocations	1,215,919		896,523
Legacy Greenspring investments in funds and accrued carried interest allocations(1)	1,208,693		—
Total investments	$	2,514,937	$	970,902

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(1)Reflects investments in funds of $219.1 million and carried interest allocations of $989.6 million.

The Company recognized equity method income of the following:


	Three Months Ended September 30,				Six Months Ended September 30,
	2021		2020		2021		2020
Carried interest allocations	$	196,386	$	166,065	$	422,748	$	37,563
Investment income	7,187		4,325		13,611		1,147
Legacy Greenspring carried interest allocations(1)	—		—		—		—
Legacy Greenspring investment income(2)	—		—		—		—
Total equity method income	$	203,573	$	170,390	$	436,359	$	38,710

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(1)Reflects the net effect of gross realized carried interest allocations of $3.0 million and the reversal of such amounts in unrealized carried interest allocations for the period from September 20, 2021 to September 30, 2021.

(2)Reflects the net effect of gross realized investment income of $1.4 million and the reversal of such amounts in unrealized investment income for the period from September 20, 2021 to September 30, 2021.

The increase in carried interest allocations for the three and six months ended September 30, 2021 as compared to the three and six months ended September 30, 2020 was primarily attributable to unrealized appreciation in the fair value of the underlying investments in the Company’s private equity funds. See note 2 for a discussion of the Company’s accounting policy for investments on a three-month lag.

As of September 30, 2021, the Company’s investments in three SMAs each individually represented 10% or more of the total accrued carried interest allocations balance, and in the aggregate represented approximately 34% of the total accrued carried interest allocations balance as of that date. As of March 31, 2021, the Company’s investments in two SMAs each individually represented 10% or more of the total accrued carried interest allocations balance, and in the aggregate represented approximately 26% of the total accrued carried interest allocations balance as of that date. As of September 30, 2021, the Company’s investments in three commingled funds individually represented 10% or more of the total legacy Greenspring investments in funds and accrued carried interest allocations balance, and in the aggregate represented approximately 40% of the total legacy Greenspring investments in funds and accrued carried interest allocations balance as of that date.

Of the total accrued carried interest allocations balance as of September 30, 2021 and March 31, 2021, respectively, $638.8 million and $465.6 million were payable to affiliates and is included in accrued carried interest-related compensation in the condensed consolidated balance sheets. Of the total legacy Greenspring investments in funds and accrued carried interest allocations balance as of September 30, 2021, $989.6 million was payable to employees who are considered affiliates of the Company and is included in legacy Greenspring accrued carried interest-related compensation in the condensed consolidated balance sheets and $219.1 million is reflected as non-controlling interests in legacy Greenspring entities in the condensed consolidated balance sheets.

The Company evaluates each of its equity method investments to determine if any are considered significant as defined by the SEC. As of September 30, 2021 and March 31, 2021 and for the three and six months ended September 30, 2021 and 2020, no individual equity method investment held by the Company met the significance criteria. As a result, the Company is not required to provide separate financial statements for any of its equity method investments.