What changed in this filing

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Item 7. Management’s Discussion and Analysis

2023-02-24 compared with 2022-03-29 · 712 added, 695 removed, 1326 unchanged (51% of the section changed)

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Factors that could cause or contribute to these differences include, but are not limited to, those identified below and elsewhere in this report, particularly in “Cautionary Note Regarding Forward-Looking Statements,” “Item 1A.—Risk Factors” and “—Unaudited Pro Forma Condensed Consolidated Financial Information and Other Data.” We assume no obligation to update any of these forward-looking statements.

On January 12, 2022, we completed a corporate reorganization (the “Reorganization”), which included a corporate conversion of TPG Partners, LLC to a Delaware corporation named TPG Inc., in conjunction with an initial public offering (the “IPO”) of our Class A common stock.

The IPO closed on January 18, 2022.

Unless the context suggests otherwise, references in this report to “TPG”, “the Company”, “we”, “us” and “our” refer (i) prior to the completion of the Reorganization and IPO to TPG Group Holdings SBS, L.P.

and its consolidated subsidiaries and (ii) from and after the completion of the Reorganization and IPO to TPG Inc.

and its consolidated subsidiaries.

Business Overview

We are a leading global alternative asset manager with approximately $113.6 billion in AUM as of December 31, 2021.

We have built our firm through a 30-year history of successful innovation and organic growth, and we believe that we have delivered attractive risk-adjusted returns to our clients and established a premier investment business focused on the fastest-growing segments of both the alternative asset management industry and the global economy.

We believe that we have a distinctive business approach as compared to other alternative asset managers and a diversified, innovative array of investment platforms that position us well to continue generating sustainable growth across our business.

We are a leading global alternative asset manager with approximately $135.0 billion in assets under management (“AUM”) as of December 31, 2022.

We primarily invest in complex asset classes such as private equity, real estate and public market strategies.

We have built our firm over 30 years of successful innovation and organic growth, and we believe that we have delivered attractive risk-adjusted returns to our clients and established a premier investment business focused on the fastest-growing segments of both the alternative asset management industry and the global economy.

We believe that we have a distinctive business approach as compared to other alternative asset managers and a diversified, innovative array of multi-product investment platforms that position us well to continue generating sustainable growth across our business.

Trends Affecting our Business

Our business is affected by a variety of factors, including conditions in the financial markets and economic and political conditions.

Changes in global economic conditions and regulatory or other governmental policies or actions can materially affect the values of funds managed by TPG, as well as our ability to source attractive investments and completely deploy the capital that we have raised.

However, we believe our disciplined investment philosophy across our diversified investment platforms and our shared investment themes focus on attractive and resilient sectors of the global economy have historically contributed to the stability of our performance throughout market cycles.

During 2022, global economies experienced persistent, elevated volatility as they contended with rising consumer prices, tightening financial conditions, growth risks and geopolitical tensions.

Relative to the first three quarters of the year, the three months ended December 31, 2022, continued to see elevated volatility across asset classes, but benefited from improved sentiment as inflation appeared to peak in many countries, China relaxed COVID restrictions and hopes strengthened that the U.S.

Federal Reserve could successfully tighten financial conditions just enough to tame inflation without causing a recession.

Inflation was elevated throughout 2022 and rose persistently for most of the year, with consumer price growth hitting an over 40-year high of 9.1% year-over-year in June.

Consumer Price Index (“CPI”) readings in the fourth quarter of 2022 finally started to indicate that price pressures had peaked, with October, November and December data showing increases of 7.7%, 7.1% and 6.5% relative to the prior year.

Core Consumer Price Index, which excludes volatile energy and food prices, climbed 5.7% in December 2022 from a year earlier, easing from a 6.0% gain in the month prior and from the year’s high of 6.6% in September.

The Federal Reserve initiated a historic tightening cycle in 2022.

central bank raised the federal funds rate for seven consecutive meetings in 2022, beginning with a 25 basis point increase in March, ultimately increasing the rate by 400bps over the course of the year.

Data showing slowing inflation during the three months ended December 31, 2022, initiated a slowing in the pace of rate hikes, raising hopes for a near-term peak in the tightening cycle and providing support for risk assets in the quarter.

In the fourth quarter the Federal Reserve raised rates by 0.75% and 0.50% at its

November and December meetings, respectively, bringing the target rate up to 4.25% - 4.50%.

While December’s 50 basis point increase represented a slowdown from four consecutive 75 basis point hikes, Federal Reserve officials communicated that they expect to raise the rate to between 5.00% and 5.50% in 2023, a higher forecast relative to expectations communicated at the September meeting.

Treasury yield curve continued to invert in the fourth quarter of 2022, with yields at the short end of the curve rising while longer-dated yields remained relatively flat from the end of the prior quarter.

Across the curve, yields were significantly higher at the end of 2022 relative to at the end of 2021.

Benchmark 10-year Treasuries ended the quarter yielding 3.88%, up from 3.80% as of the end of the third quarter of 2022, and up from 1.51% as of the end of 2021.

2-year Treasury yields reached a high of 4.73% in the fourth quarter of 2022 and closed the year at 4.42%, up from 4.20% as of the end of the prior quarter and up from 0.73% as of the end of 2021.

Corporate bond prices were similarly weaker in 2022, with indices of Investment Grade and High Yield bonds falling 18.4% and 16.9% respectively for the year, though posted slight gains in the fourth quarter.

Spreads tightened modestly over the final three months of the year but widened 40 basis points and 171 basis points, respectively, on the year overall.

equities struggled throughout 2022 amid the backdrop of inflation, tightening financial conditions, recession fears and geopolitical conflict, with the S&P 500 and Nasdaq Composite recording their worst calendar years since 2008.

The majority of losses were concentrated in the first nine months of the year, with performance improving in the three months ended December 31, 2022 as inflation slowed modestly despite underlying economic fundamentals remaining strong, providing hope the Federal Reserve would slow its pace of rate increases.

The S&P 500, Dow Jones and Nasdaq Composite were +7.1%, +15.4% and (1.0%) respectively in the fourth quarter, cementing declines of 19.4%, 8.8% and 33.1%, respectively, for 2022.

Energy was by far the top performing S&P sector in 2022 and the only sector to gain year-over-year, rising 59.0%, followed by the Utilities and Consumer Staples sectors which posted annual declines of (1.4%) and (3.2%) respectively.

Communication Services and Consumer Discretionary were the worst performing sectors amid a general decline in growth stocks, declining (40.4%) and (37.6%) respectively for 2022.

Volatility, as measured by the CBOE Volatility Index, finished the year at 21.67, down from 31.62 as of the end of the three months prior but up from 17.22 as of the end of 2021.

labor market remained a key factor in the overall domestic economic picture.

December’s labor report published by the U.S.

Bureau of Labor Statistics indicated unemployment fell to 3.5% during the month, down from 3.7% in November.

Job growth slowed but remained relatively robust.

Employers added a seasonally adjusted 223,000 jobs in December, fewer than the 263,000 and 261,000 added in November and October, respectively.

Our portfolio appreciated 8% in 2022, compared to declines in public indices during the year, which we believe reflects the strong operating performance and value creation initiatives in our portfolio.

Our private portfolio increased in value and we were able to exit certain deals above their December 31, 2021 valuations, while our public portfolio experienced a decline in value.

In addition to these macroeconomic trends and market factors, our future performance is heavily dependent on our ability to attract new capital, generate strong, stable returns, source investments with attractive risk-adjusted returns and provide attractive investment products to a growing investor base.

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The capital we raise drives growth in our AUM, fee earning assets under management, or “FAUM,” management fees and performance fees.

Although our AUM, FAUM and fee-related revenues have grown significantly since our inception and in recent years, a significant deterioration in the returns we generate for our fund investors, adverse market conditions or an outflow of capital in the alternative asset management industry in general, or in the private equity segments in which we specialize, could negatively affect our future growth rate.

management industry in general, or in the private equity segments in which we specialize, could negatively affect our future growth rate.

In addition, market dislocations, contractions or volatility could adversely affect our returns in the future, which could in turn affect our fundraising abilities in the future, as both existing and prospective fund investors will consider our historical return profile in future asset allocations.

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Our ability to continue to grow our revenue is dependent on our continued ability to source attractive investments and efficiently deploy the capital that we have raised.

Although the capital deployed in any one quarter may vary significantly from

period to period due to the availability of attractive opportunities and the long-term nature of our investment strategies, we believe that our ability to efficiently and effectively invest our growing pool of fund capital puts us in a favorable position to maintain our revenue growth over time.

Although the capital deployed in any one quarter may vary significantly from period to period due to the availability of attractive opportunities and the long-term nature of our investment strategies, we believe that our ability to efficiently and effectively invest our growing pool of fund capital puts us in a favorable position to maintain our revenue growth over time.

Our ability to identify attractive investments and execute on those investments is dependent on a number of factors, including the general macroeconomic environment, market positioning, valuation, transaction size and the expected duration of such investment opportunities.

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Reorganization

On December 31, 2021, TPG undertook certain transactions as part of the Reorganization (as defined herein), which included transferring to RemainCo certain economic entitlements to performance allocations from certain of the TPG general partner entities as well as cash at the TPG Operating Group that related to those TPG general partner entities’ economic entitlements.

On December 31, 2021, we undertook certain transactions as part of the Reorganization, which included transferring to RemainCo certain economic entitlements to performance allocations from certain of the TPG general partner entities as well as cash at the TPG Operating Group that related to those TPG general partner entities’ economic entitlements.

We continue to consolidate these TPG general partner entities because we maintain control and have an implicit variable interest.

We also transferred the TPG Operating Group’s co-investment interests in consolidated TPG Funds (as defined herein) which led to the deconsolidation of those funds as of December 31, 2021.

We also transferred the TPG Operating Group’s co-investment interests in certain consolidated TPG Funds (“TPG Funds”) which led to the deconsolidation of those funds as of December 31, 2021.

Additionally, we transferred certain other economic entitlements associated with certain other investments, including our investment in certain TPG funds we do not consolidate, our former affiliate and other equity method investments.

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and completed the remainder of the Reorganization on January 12, 2022.

Following our incorporation, the Reorganization, and the IPO, we are a holding company and our only business is to act as the owner of the entities serving as the general partner of the TPG Operating Group partnerships and our only material assets are Common Units representing 25.6% of the Common Units and 100% of the interests in certain intermediate holding companies as of March 25, 2022.

Following our incorporation, the Reorganization and the IPO, we are a holding company and our only business is to act as the owner of the entities serving as the general partner of the TPG Operating Group partnerships and our only material assets are Common Units representing 25.6% of the Common Units and 100% of the interests in certain intermediate holding companies as of December 31, 2022.

In our capacity as the sole indirect owner of the entities serving as the general partner of the TPG Operating Group partnerships, we indirectly control all of the TPG Operating Group’s business and affairs.

From 2009 to May 2020, TPG and the former affiliate were in a strategic partnership in which the former affiliate served as the dedicated global credit and credit-related investing platform associated with TPG.

In May 2020, TPG and our former affiliate completed a transaction to become independent, unaffiliated businesses.

As part of the agreement, TPG reduced its previous interest in the former affiliate and retained a passive minority economic stake in the former affiliate.

On May 1, 2020, we deconsolidated the assets, liabilities and partners’ capital of our former affiliate from the consolidated financial statements, the impact of which is disclosed on the consolidated statements of cash flows.

Our interest in the former affiliate was transferred to RemainCo in connection with the Reorganization.

Basis of Accounting

TPG Group Holdings is considered the predecessor of TPG Inc.

for accounting purposes, and TPG Group Holdings’ consolidated financial statements are our historical financial statements.

is considered the successor of TPG Group Holdings for accounting purposes, and TPG Group Holdings’ consolidated financial statements are our historical financial statements.

Given the ultimate controlling partners of TPG Group Holdings control TPG Inc., who in turn controls the TPG Operating Group, we account for the acquisition of such continuing limited partners’ interests in our business, as part of the Reorganization, as a transfer of interests under common control.

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When an entity is consolidated, we reflect the accounts of the consolidated entity, including its assets, liabilities, revenues, expenses, investment income, cash flows and other amounts, on a gross basis.

While the consolidation of an entity does not impact the amounts of net income attributable to controlling interests, the consolidation does impact the financial statement presentation in accordance with GAAP.

This is a result of the fact that the accounts of the consolidated entities being reflected on a gross basis, with intercompany transactions eliminated, while the allocable share of those amounts that are attributable to third parties are reflected as single line items.

The single line items in which the accounts attributable to third parties are recorded are presented as non-controlling interests on the consolidated statements of financial condition and net income (loss) attributable to non-controlling interests on the consolidated statements of operations.

We are not required under GAAP to consolidate the majority of investment funds we advise in our consolidated financial statements because we do not have a more than insignificant variable interest.

Pursuant to GAAP and prior to the Reorganization, we consolidate certain TPG funds and SPACs, which we refer to collectively as the “consolidated TPG Funds and Public SPACs,” in our consolidated financial statements for certain of the periods we present.

We are not required under U.S.

GAAP to consolidate the majority of investment funds we advise in our consolidated financial statements because we do not have a more than insignificant variable interest.

Pursuant to U.S.

GAAP, we consolidate certain TPG funds and SPACs, which we refer to collectively as the “consolidated TPG Funds and Public SPACs,” in our consolidated financial statements for certain of the periods we present.

Management fees and performance allocations from the consolidated TPG Funds and Public SPACs are eliminated in the consolidated financial statements.

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In March 2020, the World Health Organization declared the outbreak of COVID-19 as a global pandemic.

Numerous countries, including the United States, instituted a variety of restrictive measures to contain the viral spread, including mandatory quarantines and travel restrictions, leading to significant disruptions and uncertainty in the global financial markets.

While many of the initial restrictions in the United States have been relaxed or removed, the risk of future outbreaks of COVID-19, or variants thereof, or of other public health crises remain.

Further, certain public health restrictions remain in place and lifted restrictions may be reimposed to mitigate risks to public health.

In 2021, the global economy began reopening, facilitating robust economic activity.

However, the economic recovery is only partially underway and has been gradual, uneven and characterized by meaningful dispersion across sectors and regions with uncertainty regarding its ultimate length and trajectory.

Further, the emergence of COVID-19 variants and related surges in cases have resulted in setbacks to the recovery, and subsequent surges could lead to renewed restrictions.

Many public health experts believe that COVID-19 could persist or reoccur for years, and even if the lethality of the virus declines, such reoccurrence could trigger increased restrictions on business operations.

The COVID-19 pandemic has evolved significantly and has impacted, and may continue to impact in the future, the U.S.

and global economy.

The emergence of COVID-19 variants has resulted in setbacks to the economic recovery, and subsequent surges could lead to renewed COVID-19 restrictions and could trigger increased restrictions on business operations.

The COVID-19 pandemic has affected, and will continue to affect, our business.

We continue to closely monitor developments related to COVID-19 and assess any potential negative impacts to our business.

In particular, our future results may be adversely affected by (i) decreases in the value of investments in certain industries that have been materially impacted by the COVID-19 pandemic and related governmental measures, (ii) slowdowns in fundraising activity and (iii)

reductions in our capital deployment pace.

See “See Item 1A—Risk Factors—Risks Related to Our Business—Significant setbacks in the reopening of the global economy or reinstatement of lockdowns or other restrictions as a result of the ongoing COVID-19 pandemic may negatively impact our business and our results of operations, financial condition and cash flow.”

Operating Segments

We operate our business as a single operating and reportable segment, which is consistent with how our CEO, who is our chief operating decision maker, reviews financial performance and allocates resources.

We operate collaboratively across platforms with a single expense pool.

See “Item 1A.—Risk Factors—Risks Related to Our Business—The COVID-19 pandemic caused severe disruptions in the U.S.

and global economies and has impacted, and may continue to negatively impact, our business and our results of operations, financial condition and cash flow.”

Key Financial Measures

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Fees and Other .

Fees and other consists primarily of (i) management and incentive fees for providing investment management services to unconsolidated funds, collateralized loan obligations and other vehicles;

Fees and other consists primarily of (i) management and incentive fees for providing investment management services to TPG Funds, limited partners and other vehicles;

(ii) monitoring fees for providing services to portfolio companies;

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These termination payments are recognized in the period in which the related transaction closes.

Capital Allocation-Based Income .

Capital allocation-based income is earned from the TPG funds when we have (i) a general partner’s capital interest and (ii) performance allocations which entitle us to a disproportionate allocation of investment income or loss from an investment fund’s limited partners.

Capital Allocation-Based Income (Loss) .

Capital allocation-based income (loss) is earned from the TPG funds when we have (i) a general partner’s capital interest and (ii) performance allocations which entitle us to a disproportionate allocation of investment income or loss from investment funds.

We are entitled to a performance allocation (typically 20%) based on cumulative fund or account performance to date, irrespective of whether such amounts have been realized.

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We account for our investment balances in the TPG Funds, including performance allocations, under the equity method of accounting because we are presumed to have significant influence as the general partner or managing member;

however, we do not have control as defined by Accounting Standards Codification Topic 810-Consolidation (“ASC 810”).

The Company accounts for its general partner interests in capital allocation-based arrangements as financial instruments under Accounting Standard Codification Topic 323-Investments – Equity Method and Joint Ventures (“ASC 323”) as the general partner has significant governance rights in the TPG funds in which it invests which demonstrates significant influence.

Accordingly, performance allocations are not deemed to be within the scope of Accounting Standards Codification Topic 606-Revenue from Contracts with Customers (“ASC 606”).

however, we do not have control as defined by Accounting Standards Codification (“ASC”) Topic 810, Consolidation .

The Company accounts for its general partner interests in capital allocation-based arrangements as financial instruments under ASC Topic 323, Investments – Equity Method and Joint Ventures as the general partner has significant governance rights in the TPG funds in which it invests which demonstrates significant influence.

Accordingly, performance allocations are not deemed to be within the scope of ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”).

Compensation and Benefits .

Compensation and benefits expense includes (i) base cash compensation consisting of salaries and wages, (ii) benefits and (iii) discretionary cash bonuses.

Performance allocation payments in the legal form of equity made directly or indirectly to our partners and professionals are distributed pro rata based on ownership percentages in the underlying investment partnership and are accounted for as distributions on the equity held by such partners rather than as compensation and benefits expense.

Compensation and benefits expense includes (i) cash-based compensation and benefits, (ii) equity based compensation and (iii) performance allocation compensation.

Bonuses are accrued over the service period to which they relate.

In addition, we have equity-based compensation arrangements that require certain TPG executives and employees to vest ownership of a portion of their equity interests over a service period of generally one to six years, which under U.S.

GAAP will result in compensation charges over current and future periods.

In connection with our IPO, we granted restricted stock units (“RSUs”) to executives and employees.

Distributions of performance allocations in the legal form of equity made directly or indirectly to our partners and professionals are allocated and distributed, when realized, pro rata based on ownership percentages in the underlying investment partnership and are accounted for as distributions on the equity held by such partners rather than as compensation and benefits expense prior to the Reorganization and IPO.

Subsequent to the Reorganization and IPO, we account for these distributions as performance allocation compensation.

General, Administrative and Other .

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Interest Expense .

Interest expense includes interest paid and accrued on our outstanding debt and along with the amortization of deferred financing costs.

Interest expense includes interest paid and accrued on our outstanding debt and the amortization of deferred financing costs.

Expenses of Consolidated TPG Funds and Public SPACs.

Expenses of consolidated TPG Funds and Public SPACs consists of interest expenses and other expenses related primarily to professional services fees, research expenses, trustee fees, travel expenses and other costs associated with organizing and offering these funds.

Expenses of consolidated TPG Funds and Public SPACs consist of interest expense and other expenses related primarily to professional services fees, research expenses, trustee fees, travel expenses and other costs associated with organizing and offering these entities.

Investment Income

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Fluctuations in net gains (losses) from investment activities between reporting periods are primarily driven by changes in the fair value of our investment portfolio and, to a lesser extent, the gains (losses) on investments disposed of during the period.

The fair value of, as well as the ability to recognize gains from, our investments is significantly impacted by the global financial markets.

The fair value of, as well as the ability to recognize gains (losses) from, our investments is significantly impacted by the global financial markets.

This impact affects the net gains (losses) from investment activities recognized in any given period.

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Unrealized Gains (Losses) on Derivative Liabilities of Consolidated Public SPACs .

Unrealized gains (losses) on derivative liabilities are changes in the fair value of derivative contracts entered into by our consolidated Public SPAC entities, which are included in current period earnings.

Unrealized gains (losses) on derivative liabilities of consolidated Public SPACs are changes in the fair value of derivative contracts entered into by our consolidated Public SPAC entities, which are included in current period earnings.

Interest, Dividends and Other of Consolidated TPG Funds and Public SPACs.

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Income Tax Expense

Income tax expense consists of taxes paid or payable by our operating subsidiaries.

We have been historically treated as a partnership for U.S.

As a result of the Reorganization, the Company is treated as a corporation for U.S.

federal and state income tax purposes.

As such, income generated by us flows through to its partners and is generally not subject to U.S.

federal or state income tax at the TPG Group Holdings level.

Certain consolidated subsidiaries are subject to taxation in the U.S.

(federal, state and local) and foreign jurisdictions as a result of each subsidiary’s respective entity classification utilized for tax reporting purposes.

We are taxed as a corporation for U.S.

federal and state income tax purposes and, as a result, we are subject to U.S.

federal and state income taxes, in addition to local and foreign income taxes, with respect to our allocable share of any taxable income generated by us.

We are subject to U.S.

federal and state income taxes, in addition to local and foreign income taxes, with respect to our allocable share of taxable income generated by the TPG Operating Group partnerships.

Prior to the Reorganization, the Company was treated as a partnership for U.S.

federal income tax purposes and therefore was not subject to U.S.

federal and state income taxes except for certain consolidated subsidiaries that were subject to taxation in the U.S.

(federal, state and local) and foreign jurisdictions as a result of their entity classification for tax reporting purposes.

Non-Controlling Interests

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2022 2021 2020

($ in thousands)

(dollars in thousands, except share and per share data)

Fees and other $ 1,246,635 $ 977,904 $ 883,366

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Compensation and benefits:

Cash-based compensation and benefits 473,696 579,698 522,715

Equity-based compensation 627,714 — —

Performance allocation compensation 416,556 — —

Total compensation and benefits 1,517,966 579,698 522,715

General, administrative and other 368,915 278,590 260,748

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Total expenses 1,944,799 916,566 817,556

Investment income

Income from investments:

Net gains (losses) from investment activities 353,219 (5,839) 71,694

Investment income (loss)

Income (loss) from investments:

Net (losses) gains from investment activities (110,131) 353,219 (5,839)

Gain on deconsolidation — — 401,695

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Interest, dividends and other 6,741 10,321 5,410

Total investment income 605,214 151,429 166,758

Income before income taxes 4,665,035 1,448,711 1,186,132

Total investment (loss) income (81,840) 605,214 151,429

(Loss) income before income taxes (23,752) 4,665,035 1,448,711

Income tax expense 32,483 9,038 9,779

Net income 4,655,997 1,438,932 1,180,443

Net income (loss) attributable to redeemable equity in Public SPACs 155,131 (195,906) (9,684)

Net income (loss) attributable to non-controlling interests in consolidated TPG Funds 19,287 (12,380) 58,055

Net (loss) income (56,235) 4,655,997 1,438,932

Net (loss) income attributable to redeemable equity in Public SPACs prior to Reorganization and IPO (517) 155,131 (195,906)

Net income attributable to non-controlling interests in consolidated TPG Funds prior to Reorganization and IPO — 19,287 (12,380)

Net income attributable to other non-controlling interests prior to Reorganization and IPO 966 2,455,825 719,640

Net income attributable to TPG Group Holdings prior to Reorganization and IPO 5,256 2,025,754 927,578

Net income attributable to redeemable equity in Public SPACs 15,165 — —

Net loss attributable to non-controlling interests in TPG Operating Group (180,824) — —

Net income attributable to other non-controlling interests 11,293 — —

Net income attributable to controlling interests $ 2,025,754 $ 927,578 $ 480,514

Disaffiliation of Former Affiliate

As a result of the disaffiliation agreement with our former affiliate, effective May 1, 2020, we no longer consolidated our former affiliate and began accounting for our remaining interest as an equity method investment.

Accordingly, prior to May 1, 2020, our historical financial statements include the consolidated results of our former

affiliate, including its revenues, expenses and operating activities.

Beginning May 1, 2020, the equity earnings related to this investment are included within investment income.

The impact of the deconsolidation is a key driver of certain fluctuations discussed herein when comparing the year ended December 31, 2021 to the year ended December 31, 2020, as well as the year ended December 31, 2020 to the year ended December 31, 2019.

Net income attributable to TPG Inc.

subsequent to Reorganization and IPO $ 92,426 $ — $ —

Year Ended December 31,

2022 2021 2020

(dollars in thousands, except share and per share data)

Net income (loss) per share data:

Net income (loss) available to Class A common stock per share

Basic $ 1.10 $ — $ —

Diluted $ (0.19) $ — $ —

Weighted-average shares of Class A common stock outstanding

Basic 79,255,411 — —

Diluted 308,908,052 — —

Year Ended December 31, 2022 Compared to Year Ended December 31, 2021

Revenues consisted of the following for the years ended December 31, 2021 and December 31, 2020:

Revenues consisted of the following for the years ended December 31, 2022 and 2021:

Year Ended December 31,

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Fees and other revenues increased by $268.7 million, or 27%, during the year ended December 31, 2022 compared to the year ended December 31, 2021.

The change is comprised of increases in transaction, monitoring and other fees, net of $37.4 million, an increase in management fees of $32.5 million, and increases in expense reimbursements and other of $24.6 million.

This change resulted from a $199.3 million increase in management fees, a $54.8 million increase in expense reimbursements and other and a $14.7 million increase in transaction, monitoring and other fees, net.

Management Fees .

The increase in management fees was primarily driven by additional management fees from Growth V of $54.3 million, which held its final close in the third quarter of 2021 and raised approximately $1.9 billion in 2021.

Additional management fees were also earned from Rise Climate of $40.5 million, which held its initial closings in 2021 and raised approximately $6.7 billion.

The acquisition of NewQuest also contributed an additional $13.7 million of management fees during the year ended December 31, 2021.

The increases were primarily offset by the deconsolidation of our former affiliate, which resulted in lower management fees of $73.4 million due to a partial year of fees earned for the year ended December 31, 2020 compared to no fees earned during the year ended December 31, 2021, as well as a decline in management fees of $22.2 million earned from Growth IV.

Certain management fees in the year ended December 31, 2021 were considered catch-up fees as a result of additional capital commitments from limited partners to Growth V and Rise II in the amounts of $9.2 million and $0.2 million, respectively.

Both funds had their initial closing in 2020.

Management fees increased by $199.3 million, or 27%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was primarily driven by fee earning capital raised resulting in additional management fees of $40.3 million from TPG IX, $22.0 million from Asia VIII, $19.4 million from Rise III and $10.4 million from TPH II, each of which were activated during the third quarter of 2022;

$76.2 million from TREP IV, which was activated during the first quarter of 2022;

and $65.4 million from Rise Climate, which was activated during the third quarter of 2021.

These increases were partially offset by a decrease in management fees of $29.9 million earned from TPG VII resulting from a decrease in fee earning AUM during the year ended December 31, 2022 compared to the year ended December 31, 2021.

Certain management fees in the year ended December 31, 2022 were considered catch-up fees as a result of additional capital commitments from limited partners to Rise Climate and TTAD II in the amount of $2.8 million.

Transaction, Monitoring and Other Fees, Net .

The change in transaction, monitoring and other fees, net was primarily driven by an increase in capital markets fees of $52.3 million due to increased debt and equity capital market transactions within the TPG portfolio companies during the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase was offset by $9.5 million of incentive fees earned by our former affiliate prior to its deconsolidation on May 1, 2020.

Transaction, monitoring and other fees, net increased by $14.7 million, or 16%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was primarily driven by a $9.6 million increase in transaction fees earned from portfolio companies in our Real Estate and Capital platforms and a $5.1 million increase in our Market Solutions platform as a result of increased capital markets activity among our portfolio companies involving our broker-dealer.

Expense Reimbursements and Other .

The change in expense reimbursements and other was largely driven by additional reimbursements from TPG funds of $13.7 million and additional services provided to our former affiliate and portfolio companies of $10.7 million.

Expense reimbursements and other increased by $54.8 million, or 35%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was primarily driven by a $18.4 million increase in additional reimbursements from TPG funds due to increased fundraising activities, $19.8 million in administrative service fees from RemainCo earned during the year ended December 31, 2022, and a $14.9 million increase in income from services rendered to TPG funds and Portfolio Companies.

Performance Allocations.

Performance allocations increased by $2,589.3 million, to $3,792.9 million for the year ended December 31, 2021, compared to $1,203.5 million for the year ended December 31, 2020.

The increase primarily resulted from realized and unrealized portfolio appreciation of 38% during the year ended December 31, 2021 compared to realized and unrealized appreciation of the portfolio of 18% during the year ended December 31, 2020.

Realized performance allocations for the years ended December 31, 2021 and 2020 totaled $1,956.2 million and $532.8 million, respectively.

Unrealized performance allocations for the years ended December 31, 2021 and 2020 totaled $1,836.7 million and $670.7 million, respectively.

Performance allocations decreased by $3,072.8 million to $720.1 million, or 81%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was primarily driven by an 8% appreciation of our realized and unrealized portfolio during the year ended December 31, 2022 compared to a 38% appreciation of our realized and unrealized portfolio during the year ended December 31, 2021.

Realized performance allocations for the year ended December 31, 2022 and 2021 totaled $1,409.8 million and $1,956.2 million, respectively.

The change in unrealized performance allocations for the year ended December 31, 2022 was a loss of $689.7 million.

Unrealized performance allocation gains for the year ended December 31, 2021 totaled $1,836.7 million.

The table below highlights performance allocations for the years ended December 31, 2022 and 2021, and separates the entities listed into two categories to reflect the Reorganization:

(1) TPG general partner entities from which the TPG Operating Group Common Unit holders are expected to receive a 20% performance allocation and (2) TPG general partner entities from which the TPG Operating Group Common Unit holders are not expected to receive any performance allocation.

(i) TPG general partner entities from which the TPG Operating Group Common Unit holders are expected to receive a 20% performance allocation and (ii) TPG general partner entities from which the TPG Operating Group Common Unit holders are not expected to receive any performance allocation.

Year Ended December 31,

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TPG VII $ 171,926 $ 902,941 $ (731,015) (81) %

TPG VIII 558,759 — 558,759 NM

TPG VIII 445,242 558,759 (113,517) (20) %

TPG IX 1,146 — 1,146 NM

(50,005) 381,295 (431,300) (113) %

Asia VII 9,400 426,270 (416,870) (98) %

THP 114,805 35,159 79,646 227 %

THP I 5,381 114,805 (109,424) (95) %

THP II 2,529 — 2,529 NM

TES 11,618 8,232 3,386 41 %

AAF 32,237 — 32,237 NM

AAF 135,098 32,237 102,861 319 %

Capital 732,335 2,424,539 (1,692,204) (70) %

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Growth IV 21,141 326,824 (305,683) (94) %

Growth V 82,612 — 82,612 NM

Growth V 68,890 82,612 (13,722) (17) %

TTAD I 455 108,458 (108,003) (100) %

TDM 33,305 54,325 (21,020) (39) %

Evercare 13,731 — 13,731 NM

Growth 75,960 636,330 (560,370) (88) %

Rise I (16,836) 142,938 (159,774) (112) %

Rise II 69,253 — 69,253 NM

Rise II 19,739 69,253 (49,514) (71) %

Impact 2,903 212,191 (209,288) (99) %

TREP III 152,658 — 152,658 NM

Real Estate 152,658 — 152,658 NM

TREP III 12,728 152,658 (139,930) (92) %

Real Estate $ 12,728 $ 152,658 $ (139,930) (92) %

Year Ended December 31,

2022 2021 Change %

($ in thousands)

TPEP 9,107 29,804 (20,697) (69) %

NewQuest 16,186 — 16,186 NM

Strategic Capital 2,793 — 2,793 NM

NewQuest 784 16,186 (15,402) (95) %

Strategic Capital (2,793) 2,793 (5,586) (200) %

Market Solutions 7,098 48,783 (41,685) (85) %

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Asia V (42,864) 74,956 (117,820) (157) %

MMI 1,333 — 1,333 NM

MMI 117 1,333 (1,216) (91) %

TPG TFP (750) 201 (951) (473) %

Capital (63,871) 113,531 (177,402) (156) %

Year Ended December 31,

2021 2020 Change %

($ in thousands)

Growth II 8,977 45,141 (36,164) (80) %

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Biotech III (34,974) 30,681 (65,655) (214) %

Biotech IV 1,977 — 1,977 NM

Biotech IV (533) 1,977 (2,510) (127) %

Biotech V — (4,095) 4,095 100 %

STAR — 11,809 (11,809) (100) %

Growth (14,596) 138,529 (153,125) (111) %

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TSI 124 14,523 (14,399) (99) %

Evercare (13,731) 13,731 (27,462) (200) %

Impact (13,607) 28,254 (41,861) (148) %

Former affiliate funds — (111,149) 111,149 100 %

Other — (111,149) 111,149 100 %

Total TPG Operating Group Excluded (2)

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As such, net income available to controlling interest holders is zero for each of these funds following the Reorganization.

(2) The TPG Operating Group Excluded entities’ performance allocations is not a component of net income attributable to TPG following the Reorganization;

(2) The TPG Operating Group Excluded entities’ performance allocations are not a component of net income attributable to TPG following the Reorganization;

however, the TPG general partner entities continue to be consolidated by us.

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See “—Unaudited Pro Forma Condensed Consolidated Financial Information and Other Data” which reflects the projected impact of the Reorganization.

The increase in total performance allocations for the year ended December 31, 2021 compared to the year ended December 31, 2020 was primarily generated by realized and unrealized appreciation in TPG VII, TPG VIII, Asia VI, Asia VII, THP, Growth IV, TREP III, TPG VI, and Asia V.

As of December 31, 2021, accrued performance allocations for Common Unit holders TPG Operating Group shared TPG general partner entities totaled $4.1 billion.

As of December 31, 2021, accrued performance allocations for Common Unit holders TPG Operating Group excluded TPG general partner entities totaled $1.3 billion.

Capital Interest.

Capital interest income increased by $177.7 million to $205.6 million for the year ended December 31, 2021 from $28.0 million for the year ended December 31, 2020.

The increase was primarily driven by income from our investments in the Capital and Real Estate platforms.

Compensation and Benefits.

Compensation and benefits expense increased by $57.0 million, or 11%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase was primarily driven by a $73.5 million increase in bonuses and one time payments, which is reduced by the impact of our former affiliate in the amount of $22.9 million for the year ended December 31, 2020.

The increase was also driven by a $19 million increase in salaries and benefits by an increase in headcount, which is reduced by the impact of our former affiliate in the amount of $22.1 million for the year ended December 31, 2020.

The decrease in total performance allocations for the year ended December 31, 2022 compared to the year ended December 31, 2021 was primarily driven by lower realized and unrealized appreciation in TPG VII, Asia VI, Asia VII, Growth III, Growth IV, THP I, Rise I and TREP III.

For the year ended December 31, 2022, our investments have generated realized and unrealized portfolio appreciation of 8% compared to 38% for the year ended December 31, 2021.

As of December 31, 2022, accrued performance allocations presented as investments in the Consolidated Statement of Financial Condition for Common Unit holders TPG Operating Group shared TPG general partner entities totaled $4.1 billion.

As of December 31, 2022, accrued performance allocations presented as investments in the Consolidated Statement of Financial Condition for Common Unit holders TPG Operating Group excluded TPG general partner entities totaled $0.6 billion.

Capital Interests .

Capital interests income decreased by $169.5 million, or 82%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was primarily driven by a decrease in income from our investments in TPG VII, TPG VIII, Asia VI and Asia VII in our Capital platform, TRTX in our Real Estate platform, Growth III, Growth IV and TTAD I in our Growth platform, and Rise I in our Impact platform.

These decreases were partially offset by an increase in income from our investment in AAF in our Capital platform.

Cash-Based Compensation and Benefits.

Cash-based compensation and benefits expense decreased by $106.0 million, or 18%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was primarily driven by a $127.7 million decrease in bonuses for senior professionals for the year ended December 31, 2022 which, following our Reorganization and IPO, are recorded in performance allocation compensation expense.

This decrease was partially offset by increases in salaries and benefits and accrued bonuses of $29.8 million and $11.0 million, respectively, driven by an increase in headcount for the year ended December 31, 2022.

Equity-Based Compensation.

Equity-based compensation expense increased by $627.7 million for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was primarily attributable to the Reorganization and IPO, which resulted in $550.0 million of expense associated with unvested units granted prior to or in conjunction with the IPO to certain of our employees at TPG Partner Holdings, RemainCo, and the TPG Operating Group as well as $77.7 million of expense associated with RSUs granted to TPG employees and certain of our executives upon completion of our IPO in January 2022.

We had no such expense during the year ended December 31, 2021.

Performance Allocation Compensation.

Performance allocation compensation increased by $416.6 million for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was primarily attributable to the recognition of partnership distributions to our partners and professionals as compensation expense following our IPO.

We had no such expense during the year ended December 31, 2021 as we were a private partnership.

General, Administrative and Other.

General and administrative expenses increased by $90.3 million, or 32%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The increase was primarily driven by a $31.0 million increase in professional fees, which is reduced by the impact of our former affiliate in the amount of $18.2 million for the year ended December 31, 2020.

This increase was also driven by a $21.6 million increase in office overhead

and other, which is reduced by the impact of our former affiliate in the amount of $30.1 million for the year ended December 31, 2020.

The increase was also driven by an increase in reimbursable expenses incurred on behalf of TPG funds of $13.7 million.

This change was primarily driven by a $18.4 million increase in expenses related to our fundraising activities that are ultimately reimbursable from TPG funds, a $28.8 million increase in office overhead and other, inclusive of a $20.6 million insurance policy purchased in connection with the IPO and a $26.5 million increase of other administrative expenses.

Depreciation and Amortization.

Depreciation and amortization increased by $14.1 million, or 197%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase is primarily due to the amortization of intangible assets of $14.2 million during the year ended December 31, 2021, related to the acquisition of NewQuest on July 1, 2021.

Depreciation and amortization increased by $11.8 million for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was primarily due to the amortization of intangible assets resulting from the acquisition of NewQuest in July 2021.

Interest Expense.

Interest expense decreased by $2.7 million, or 14%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

This decrease was primarily driven by a reduction in debt outstanding during the period due to repayment of the Revolving Credit Facility to Affiliate in March of 2021 (as defined herein) in August 2021.

Interest expense increased by $5.3 million, or 33%, for the year ended December 31, 2022 compared to the year ended December 31, 2021 primarily due to higher interest rates on certain borrowings.

Expenses of Consolidated TPG Funds and Public SPACs.

Expenses of consolidated TPG Funds and Public SPACs increased by $12.8 million, or 161%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase was primarily due to additional professional services expenses in our consolidated Public SPAC entities as a result of closing three SPAC initial public offerings and business combinations associated with our consolidated Public SPACs.

Net Gains from Investment Activities.

Net gains from investment activities increased by $359.1 million, to a gain of $353.2 million from a loss of $5.8 million, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase of net gains from investment activities was primarily driven by the deconsolidation of two of our Public SPACs and the associated business combination with Nerdy, Inc.

and Vacasa, Inc., which resulted in gains of $232.5 million.

We recognized a net gain of $95.0 million associated with our step acquisition of NewQuest.

The increase was also driven by other equity method investments in which the Company has significant influence of $137.0.

Gain on Deconsolidation .

The $401.7 million gain on deconsolidation for the year ended December 31, 2020, resulted from the disaffiliation of our former affiliate in May 2020 and the subsequent step-up to fair value of the retained equity method investment.

Expenses of consolidated TPG Funds and Public SPACs decreased by $17.4 million, or 84%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was primarily driven by a reduction in non-recurring professional services expenses as a result of business combinations associated with TPG PACE Tech Opportunities Corp.

(“PACE”) and TPG Pace Solutions Corp.

(“TPGS”) during the year ended December 31, 2021.

Net (Losses) Gains from Investment Activities.

Net losses from investment activities for the year ended December 31, 2022 were $110.1 million compared to a gain of $353.2 million for the year ended December 31, 2021.

This change was primarily attributable to a gain of $122.7 million recognized on the deconsolidation of PACE, a gain of $109.9 million on the deconsolidation of TPGS, and a gain of $95.0 million recognized on the acquisition of NewQuest during the year ended December 31, 2021.

Additionally, we incurred losses of $80.4 million and $25.1 million from our investments in Vacasa, Inc.

and Nerdy Inc, respectively, during the year ended December 31, 2022.

Following the Reorganization, we no longer recognize net gains or losses from certain strategic investments that were transferred to RemainCo on December 31, 2021.

Interest, Dividends and Other.

Interest, dividends and other investment gains decreased by $1.7 million, or 20%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The decrease was driven by a reduction of dividend income of $3.4 million due to the deconsolidation of our former affiliate.

The decrease was partially offset by an increase of interest income of $1.7 million due to a larger cash balance in the year ended December 31, 2021 compared to the year ended December 31, 2020.

Net (Losses) Gains from Investment Activities of consolidated TPG Funds and Public SPACs.

Net (losses) gains from investment activities of consolidated TPG Funds and Public SPACs increased by $42.1 million to a gain of $23.4 million from a loss of $18.7 million, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase was primarily related to the fair value changes of the underlying investments of TPEP of $34.4 million.

Unrealized (Losses) Gains on Derivative Liabilities of Public SPACs .

The $211.8 million unrealized gain and $239.3 million of unrealized loss on derivative instruments recognized during the year ended December 31, 2021 and 2020, respectively, were attributable to warrants issued by the consolidated Public SPAC entities and forward purchase agreements held by third parties.

Interest, dividends and other increased by $2.7 million, or 42%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

Net Gains (Losses) from Investment Activities of Consolidated TPG Funds and Public SPACs.

Net gains (losses) from investment activities of consolidated TPG Funds and Public SPACs had no activity during the year ended December 31, 2022 compared to a net gain of $23.4 million for the year ended December 31, 2021.

Following certain Reorganization activities, we no longer consolidate TPEP as we do not have a controlling financial interest.

Unrealized Gains on Derivative Liabilities of Public SPACs .

The $12.4 million and $211.8 million of unrealized gain on derivative instruments recognized during the year ended December 31, 2022 and 2021, respectively, were attributable to warrants issued by the consolidated Public SPAC entities and forward purchase agreements held by third parties.

The warrants held by public investors and forward purchase agreements are treated as liability instruments rather than equity instruments and subject to mark-to-market adjustments each period.

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Interest, Dividends and Other of Consolidated TPG Funds and Public SPACs.

Interest, dividends and other of consolidated TPG Funds and Public SPACs increased by $4.9 million, or 91%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

This increase was primarily related to an expense reimbursement of EUR 15.0 million, on the termination of a proposed business combination, recognized by TPG Pace Beneficial Finance Corp.

during the year ended December 31, 2021 compared to no such reimbursement during the year ended December 31, 2020.

Interest, dividends and other of consolidated TPG Funds and Public SPACs decreased by $3.6 million, or 35%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was primarily related to an expense reimbursement of EUR 15.0 million on the termination of a proposed business combination, recognized by TPG Pace Beneficial Finance Corp.

during the year ended December 31, 2021.

These decreases were partially offset by increased interest income resulting from higher interest rates on the balance of assets held in Trust Accounts by Consolidated Public SPACs.

Income Tax Expense.

Income tax expense decreased by 0.7 million, or 8%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

Income tax expense increased by $23.4 million for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was due to the Company now being treated as a corporation for U.S.

federal and state income taxes in connection with the Reorganization and IPO, beginning in January of 2022.

Year Ended December 31, 2021 Compared to Year Ended December 31, 2020

Disaffiliation of Former Affiliate

Accordingly, prior to May 1, 2020, our historical financial statements include the consolidated results of our former affiliate, including its revenues, expenses and operating activities.

Beginning May 1, 2020, the equity earnings related to this investment are included within investment income.

The impact of the deconsolidation is a key driver of certain fluctuations discussed herein when comparing the year ended December 31, 2021 to the year ended December 31, 2020.

Revenues consisted of the following for the years ended December 31, 2021 and December 31, 2020:

10 unchanged sentences

Total revenues $ 4,976,387 $ 2,114,838 $ 2,861,549 135 %

Fees and other revenues decreased by $148.5 million or 14% during the year ended December 31, 2020, compared to the year ended December 31, 2019.

The decrease primarily consists of reductions in management fees of $101.1 million, incentive fees of $24.9 million and expense reimbursements and other of $34.9 million, which was partially offset by an increase of $16.7 million in transaction fees, net.

Fees and other revenues increased by $94.5 million, or 11% during the year ended December 31, 2021, compared to the year ended December 31, 2020.

Management Fees .

The reduction in management fees was driven by the deconsolidation of our former affiliate, which resulted in lower management fees of $137.9 million due to a partial year of fees earned for the year ended December 31, 2020 compared to a full-year during the year ended December 31, 2019.

Partially offsetting this decrease were additional management fees earned from Rise II of $27.5 million, which held its final close in the year ended December 31, 2020 and raised a total of $2.2 billion, and TPEP of $12.2 million, which raised additional funds totaling $1.4 billion through its long-only equity strategy during the years ended December 31, 2019 and 2020.

Catch-up management fees of $6.9 million were recognized for the year ended December 31, 2019 stemming from additional capital commitments from limited partners to Asia VII, which had its first close in 2017.

The increase in management fees was primarily driven by additional management fees from Growth V of $54.3 million, which was activated in the third quarter of 2020, Rise Climate of $40.5 million, which was activated in the third quarter of 2021, TRTX of $10.4 million and TPG VIII of $8.5 million.

The acquisition of NewQuest also contributed an additional $13.7 million of management fees during the year ended December 31, 2021.

Both funds were activated in 2020.

Transaction, Monitoring and Other Fees, Net .

The reduction in transaction, monitoring and other fees, net was driven by deconsolidation of our former affiliate, which resulted in lower transaction and incentive fees of $12.0 million as only a partial year was reflected during the year ended December 31, 2020 compared to a full-year during the year ended December 31, 2019.

The increase was offset by $9.5 million of incentive fees earned by our former affiliate prior to its deconsolidation on May 1, 2020.

Expense Reimbursements and Other .

The reduction in expense reimbursements and other was largely driven by expense reimbursement decreases from TPG funds totaling $31.8 million and a reduction of professional services provided to TPG funds and portfolio companies of $6.3 million.

This decrease was driven by certain one-time transaction cost reimbursements in the year ended December 31, 2019 of $13.3 million related to assuming the management of Evercare, partially offset by other income of $16.6 million related to operational services provided to our former affiliate.

Performance Allocations.

Performance allocations increased by $299.9 million, or 33%, for the year ended December 31, 2020, compared to $903.6 million in the year ended December 31, 2019.

The increase primarily resulted from realized and unrealized portfolio appreciation of 18% in the year ended December 31, 2020 compared to realized and unrealized appreciation of the portfolio of 11% in the year ended December 31, 2019 across the TPG funds.

Performance allocations increased by $2,589.3 million, to $3,792.9 million for the year ended December 31, 2021, compared to $1,203.5 million for the year ended December 31, 2020.

Realized performance allocations for the years ended December 31, 2021 and 2020 totaled $1,956.2 million and $532.8 million, respectively.

Unrealized performance allocations for the years ended December 31, 2021 and 2020 totaled $1,836.7 million and $670.7 million, respectively.

The table below highlights performance allocations for the years ended December 31, 2021 and 2020, and separates the entities listed into two categories to reflect the Reorganization:

(1) TPG general partner entities from which the TPG Operating Group Common Unit holders are expected to receive a 20% performance allocation and (2) general partner entities from which the TPG Operating Group Common Unit holders are expected to receive any performance allocation.

Year Ended December 31,

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TPG VII $ 902,941 $ 541,513 $ 361,428 67 %

Asia VII 90,080 — 90,080 NM

TPG VIII 558,759 — 558,759 NM

381,295 51,189 330,106 645 %

THP 35,159 — 35,159 NM

Asia VII 426,270 90,080 336,190 373 %

THP I 114,805 35,159 79,646 227 %

TES 8,232 (3,257) 11,489 353 %

AAF 32,237 — 32,237 NM

Capital 2,424,539 714,684 1,709,855 239 %

1 unchanged sentence

64,111 290,365 (226,254) (78) %

Growth IV 102,949 — 102,949 NM

Growth IV 326,824 102,949 223,875 217 %

Growth V 82,612 — 82,612 NM

TTAD I 108,458 71,827 36,631 51 %

2 unchanged sentences

Rise I 142,938 131,495 11,443 9 %

Rise II 69,253 — 69,253 NM

Impact 212,191 131,495 80,696 61 %

TREP III 152,658 — 152,658 NM

Real Estate 152,658 — 152,658 NM

TPEP 29,804 1,426 28,378 1990 %

NewQuest 16,186 — 16,186 NM

Strategic Capital 2,793 — 2,793 NM

Market Solutions 48,783 1,426 47,357 3321 %

6 unchanged sentences

Asia V 74,956 (10,134) 85,090 840 %

MMI 1,333 — 1,333 NM

TPG TFP 201 133 68 51 %

1 unchanged sentence

Growth II 45,141 42,472 2,669 6 %

Growth II Gator 51,913 — 51,913 NM

Growth II Gator 65,167 51,913 13,254 26 %

Biotech II (342) 256 (598) (234) %

7 unchanged sentences

Real Estate 38,046 6,871 31,175 454 %

Year Ended December 31,

2021 2020 Change %

($ in thousands)

TSI 14,523 14,470 53 — %

Evercare 13,731 — 13,731 NM

Impact 28,254 14,470 13,784 95 %

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however, the TPG general partner entities continue to be consolidated by us.

We transferred the rights to the performance

allocations the TPG Operating Group historically would have received to RemainCo on December 31, 2021.

We transferred the rights to the performance allocations the TPG Operating Group historically would have received to RemainCo on December 31, 2021.

As such, net income available to controlling interest holders will be zero for each of the TPG Operating Group Excluded entities beginning January 1, 2022.

See “—Unaudited Pro Forma Condensed Consolidated Financial Information and Other Data” which reflects the projected impact of the Reorganization.

The increase in total performance allocations for the year ended December 31, 2020 compared to the year ended December 31, 2019 was primarily generated by realized and unrealized appreciation in TPG VII, Growth II, Growth III, Growth IV, STAR and Rise I.

This increase was partially offset by unrealized fair value depreciation in TPEP, Asia VI, TPG VI and former affiliate funds.

As of December 31, 2020, accrued performance allocations for Common Unit holder shared TPG general partner entities totaled $2.4 billion.

As of December 31, 2020, accrued performance allocations for Common Unit holders excluded TPG general partner entities totaled $1.1 billion.

As of December 31, 2021, accrued performance allocations for Common Unit holders of the TPG Operating Group shared TPG general partner entities totaled $4.1 billion.

As of December 31, 2021, accrued performance allocations for Common Unit holders of the TPG Operating Group excluded TPG general partner entities totaled $1.3 billion.

Capital Interest.

Capital interest income decreased by $24.4 million, or 47%, to $28.0 million for the year ended December 31, 2020 from $52.4 million for the year ended December 31, 2019.

The decrease was primarily driven from TPEP and the effect of the deconsolidation of our former affiliate.

The decrease was partially offset by increased income from our investments in the Capital and Growth platforms.

Capital interest income increased by $177.7 million to $205.6 million for the year ended December 31, 2021 from $28.0 million for the year ended December 31, 2020.

The increase was primarily driven by income from our investments in the Capital and Real Estate platforms.

Compensation and Benefits.

Compensation and benefits expense decreased by $62.5 million, or 11%, for the year ended December 31, 2020 compared to the year ended December 31, 2019.

The decrease was primarily driven by the deconsolidation of our former affiliate, which resulted in a $76.5 million reduction in compensation and benefit expenses, and decrease in one-time payments of $5.9 million, partially offset by an increase of $20.6 million in salaries and bonuses driven by an increase in headcount and bonuses.

Compensation and benefits expense increased by $57.0 million, or 11%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

General, Administrative and Other.

General and administrative expenses decreased by $86.7 million, or 25%, for the year ended December 31, 2020 compared to the year ended December 31, 2019.

The reduction was primarily due to a $80.2 million impact related to the deconsolidation of our former affiliate as well as a $6.4 million reduction in office overhead, professional fees and travel expenses due to certain public health restrictions and travel restrictions implemented as a result of the COVID-19 pandemic.

General and administrative expenses increased by $17.8 million, or 7%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

This increase was also driven by a $21.6 million increase in office overhead and other, which is reduced by the impact of our former affiliate in the amount of $30.1 million for the year ended December 31, 2020.

The increase was also driven by an increase in reimbursable expenses incurred on behalf of TPG funds of $13.7 million.

Depreciation and Amortization.

Depreciation and amortization decreased by $1.6 million, or 18%, for the year ended December 31, 2020 compared to the year ended December 31, 2019.

The reduction was primarily due to the effect of the deconsolidation of our former affiliate.

Depreciation and amortization increased by $14.1 million, or 197%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase is primarily due to the amortization of intangible assets of $14.2 million during the year ended December 31, 2021, related to the acquisition of NewQuest on July 1, 2021.

Interest Expense.

Interest expense increased by $3.5 million, or 22%, for the year ended December 31, 2020 compared to the year ended December 31, 2019.

This increase was primarily driven by an increase in gross debt outstanding during the period due to (i) amounts borrowed in March 2020 under the Revolving Credit Facility to Affiliate, which carries a variable interest rate of LIBOR plus 1.75%, and (ii) the full-year impact of the issuance of the 4.75% fixed-rate Series B Securitization Notes (as defined herein) in October 2019.

Interest expense decreased by $2.7 million, or 14%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

Expenses of Consolidated TPG Funds and Public SPACs.

Expenses of consolidated TPG Funds and Public SPACs decreased by $3.6 million, or 31%, for the year ended December 31, 2020 compared to the year ended December 31, 2019.

The decrease was primarily due to a reduction of professional services expenses in our consolidated Public SPAC entities and TPEP.

Expenses of consolidated TPG Funds and Public SPACs increased by $12.8 million, or 161%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

Net Gains from Investment Activities.

Net gains from investment activities decreased by $77.5 million, or 108%, for the year ended December 31, 2020 compared to the year ended December 31, 2019.

The reduction of net gain from investment activities was primarily caused by a depreciation of equity securities owned directly by TPG.

The increase of net gains from investment activities was primarily driven by the deconsolidation of two of our Public SPACs and the associated business combination with Nerdy, Inc.

and Vacasa, Inc., which resulted in gains of $232.5 million.

We recognized a net gain of $95.0 million associated with our step acquisition of NewQuest.

The increase was also driven by other equity method investments in which the Company has significant influence of $137.0 million.

Gain on Deconsolidation .

The $401.7 million gain on deconsolidation resulted from the disaffiliation of our former affiliate in May 2020 and the subsequent step-up to fair value of the retained equity method investment.

Interest, Dividends and Other.

Interest, dividends and other investment gains decreased by $1.7 million, or 20%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The decrease was driven by decreases in both interest income and dividend income.

The reduction of interest income of $5.4 million was primarily caused by a decreased cash balance related to the deconsolidation of our former affiliate and generally lower interest rates

in the year ended December 31, 2020 compared to the year ended December 31, 2019.

The reduction of dividend income of $5.4 million was primarily caused by the deconsolidation of our former affiliate.

The decrease was driven by a reduction of dividend income of $3.4 million due to the deconsolidation of our former affiliate.

The decrease was partially offset by an increase of interest income of $1.7 million due to a larger cash balance in the year ended December 31, 2021 compared to the year ended December 31, 2020.

Net (Losses) Gains from Investment Activities of Consolidated TPG Funds and Public SPACs.

Net losses from investment activities of consolidated TPG Funds and Public SPACs totaled $18.7 million for the year ended December 31, 2020 compared to $75.2 million in gains for the year ended December 31, 2019.

The change was primarily related to the fair value changes of the underlying investments of TPEP.

Unrealized Losses on Derivative Liabilities of Public SPACs .

The $239.3 million and $15.3 million unrealized loss on derivative instruments recognized during the years ended December 31, 2020 and 2019, respectively, was attributable to warrants issued by the consolidated Public SPAC entities and forward purchase agreements held by third parties.

The increase was primarily related to the fair value changes of the underlying investments of TPEP of $34.4 million.

Unrealized (Losses) Gains on Derivative Liabilities of Public SPACs .

The warrants held by public investors and forward purchase agreements are treated as liability instruments rather than equity instruments and subject to mark-to-market adjustments each period.

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Interest, Dividends and Other of Consolidated TPG Funds and Public SPACs.

Interest, dividends and other of consolidated TPG Funds and Public SPACs decreased by $10.8 million, or 67%, for the year ended December 31, 2020 compared to the year ended December 31, 2019.

This decline was primarily related to the reduction of interest and dividend income in TPEP and the consolidated Public SPAC entities as a result of the generally lower interest rate environment during the year ended December 31, 2020 compared to the year ended December 31, 2019.

Interest, dividends and other of consolidated TPG Funds and Public SPACs increased by $4.9 million, or 91%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

This increase was primarily related to an expense reimbursement of EUR 15.0 million, on the termination of a proposed business combination, recognized by TPG Pace Beneficial Finance Corp.

during the year ended December 31, 2021 compared to no such reimbursement during the year ended December 31, 2020.

Income Tax Expense.

Income tax expense increased by $4.1 million, or 72%, for the year ended December 31, 2020 compared to the year ended December 31, 2019.

The effective tax rate during the years ended December 31, 2020 and 2019 was 0.68% and 0.48%, respectively.

The increase was primarily related to a general increase in taxes paid in non-U.S.

subsidiaries.

Condensed Consolidated Statements of Financial Condition (GAAP basis)

Income tax expense decreased by $0.7 million, or 8%, for the year ended December 31, 2021 compared to the year ended December 31, 2020.

Unaudited Condensed Consolidated Statements of Financial Condition (U.S.

December 31, 2022 December 31, 2021

($ in thousands)

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Total assets $ 7,941,738 $ 8,962,013

Liabilities, Redeemable Equity and Partners' Capital

Liabilities, Redeemable Equity and Equity

Debt obligations $ 444,566 $ 444,444

Due to affiliates 139,863 826,999

Accrued performance allocation compensation 3,269,889 —

Other liabilities 324,261 372,597

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Redeemable equity from consolidated Public SPACs $ 653,635 $ 1,000,027

Partners' capital

Class A common stock $0.001 par value, 2,340,000,000 shares authorized (79,240,058 and 0 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively) $ 79 $ —

Class B common stock $0.001 par value, 750,000,000 shares authorized (229,652,641 and 0 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively) 230 —

Preferred stock, $0.001 par value, 25,000,000 shares authorized (0 issued and outstanding as of September 30, 2022 and December 31, 2021, respectively) — —

Additional paid-in-capital 506,639 —

Retained earnings 2,724 —

Partners’ capital controlling interests — 1,606,593

Non-controlling interests in consolidated TPG Funds — 204,548

Other non-controlling interests 2,576,199 4,654,821

Total partners' capital $ 6,261,414 $ 4,720,702

Total liabilities, redeemable equity and partners' capital $ 8,962,013 $ 7,000,551

Cash and cash equivalents increased $114.5 million primarily due to $1,474.8 million of net cash provided by operating activities offset by $1,322.6 million of net cash used in financing activities and $37.7 million of net cash used in investing activities.

As part of the Reorganization, we transferred $75.0 million of cash on hand to RemainCo.

This transfer reduced controlling and non-controlling interests by $63.4 million and $11.6 million, respectively.

Investments increased $1,562.8 million as of December 31, 2021.

For the year ended December 31, 2021, our investments have generated value creation of 38%.

As part of the Reorganization, we transferred $738.9 million of economic entitlements associated with certain other investments, including our investment in our former affiliate and certain TPG Funds, to RemainCo.

This transfer reduced controlling and non-controlling interests by $629.0 and $109.9 million, respectively.

Following this transfer, the Company no longer holds more than an insignificant economic interest in the TPG Funds that have been historically consolidated and as a result, deconsolidated those respective TPG Funds.

In December 2021, TPG Operating Group II, L.P.

entered into the Senior Unsecured Term Loan Agreement which increased our debt obligations as of December 31, 2021.

As of December 31, 2021, $200.0 million was outstanding under the Senior Unsecured Term Loan Agreement.

As part of the Reorganization, we transferred certain performance allocation economic entitlements to RemainCo, which resulted in an increase of $1,012.1 million of non-controlling interests.

Certain owners of the Company’s parent exchanged their interests for an interest in the TPG Operating Group resulting in an increase to non-controlling interests totaling $16.6 million and a related decrease in controlling interests.

Total equity 3,085,871 6,261,414

Total liabilities, redeemable equity and equity $ 7,941,738 $ 8,962,013

Cash and cash equivalents increased $134.8 million primarily due to proceeds of $770.9 million net of $34.2 million of offering costs and purchases of partnership interests of $379.6 million from our IPO in January 2022.

Investments generated net capital allocation-based income of $756.3 million which was offset by net realized proceeds of $1,424.5 million, resulting in a decrease of $779.2 million during the year ended December 31, 2022.

For the year ended December 31, 2022, our investments have generated realized and unrealized portfolio appreciation of 8%.

Accrued performance allocation compensation totaled $3,269.9 million for the year ended December 31, 2022 following our IPO.

Subsequent to the Reorganization and IPO, distributions of performance allocations in the legal form of equity made directly or indirectly to our partners and professionals are accounted for as accrued performance allocation compensation liability.

Redeemable equity from consolidated Public SPACs decreased $346.4 million primarily due to the redemption of Class A ordinary shares of TPGY.

See Note 1 6 , “Redeemable equity attributable to consolidated Public SPACs,” to our Consolidated Financial Statements.

Total equity decreased $3,175.5 million primarily due to the Reorganization and our IPO in January 2022, which transferred certain investments to RemainCo, reclassified certain performance allocations historically reflected as non-controlling interests to performance allocation compensation liabilities, and resulted in the issuance of approximately 79.1 million shares of Class A common stock and net proceeds of $793.4 million.

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION AND OTHER DATA

Defined terms included below shall have the same meaning as terms defined and included elsewhere in this Form 10-K.

The following unaudited pro forma condensed consolidated statement of financial condition as of December 31, 2021 gives pro forma effect to the Reorganization, the consummation of the initial public offering (the “IPO”) and our use of proceeds therefrom after deducting the underwriting discounts and commissions and other costs of the IPO (see transactions described under Note 1, “Organization” in the notes to the financial statements), as though such transactions had occurred as of December 31, 2021.

The following unaudited pro forma Condensed Consolidated Statement of Operations for the years ended December 31, 2021 and 2020 present our consolidated results of operations and gives pro forma effect to the Reorganization, the consummation of the IPO and other impacts of the IPO (see transactions described under Note 1 , “Organization,” to our Consolidated Financial Statements), as if they had occurred January 1, 2020.

The owners of the TPG Operating Group completed a series of actions during the year ended December 31, 2021 and on January 12, 2022 as part of the Reorganization, in conjunction with the IPO that was completed on January 18, 2022.

The unaudited pro forma condensed consolidated statements of operations for the years ended December 31, 2021 and 2020 present our consolidated results of operations giving pro forma effect to the transactions described above as if they had occurred as of January 1, 2020.

An unaudited pro forma condensed combined balance sheet is not presented because the Reorganization, IPO and the related transactions are fully reflected in the Company’s Consolidated Statement of Financial Condition as of December 31, 2022 included elsewhere in this Annual Report on Form 10-K.

The following unaudited pro forma condensed consolidated financial information has been prepared in accordance with Article 11 of Regulation S-X, as amended by the final rule, Release No.

33-10786 “Amendments to Financial Disclosure about Acquired and Disposed Businesses.”

The pro forma adjustments are based on available information and upon assumptions that management believes are reasonable in order to reflect, on a pro forma basis, the effect of this transaction on the historical financial information of TPG.

The pro forma adjustments are based on available information and upon assumptions that management believes are reasonable in order to reflect, on a pro forma basis, the effect of the Reorganization, IPO and related transactions on the historical financial information of TPG.

The Company’s historic operations consist of multiple consolidated entities formed to provide asset management services under a single controlling entity, TPG Group Holdings.

The historical periods presented in the unaudited pro forma financial information reflect the operating results of TPG Group Holdings.

The historical period presented in the unaudited pro forma financial information reflects the operating results of TPG Group Holdings.

Immediately following the Reorganization, the TPG Operating Group and its subsidiaries are controlled by the same parties and as such, we account for the Reorganization as a transfer of interests under common control.

Accordingly, we have carried forward the existing value of the members’ interests in the assets and liabilities in the TPG Operating Group’s financial statements prior to the IPO into our financial statements following the IPO.

The unaudited pro forma condensed consolidated statement of financial condition and unaudited pro forma condensed consolidated statement of operations may not be indicative of the results of operations or financial position that would have occurred had the Reorganization or the IPO and the related transactions, as applicable, taken place on the dates indicated, or that may be expected to occur in the future.

The adjustments are described in the notes to the unaudited pro forma condensed consolidated statement of operations and the unaudited pro forma condensed consolidated statement of financial condition.

The unaudited pro forma condensed consolidated financial information and other data should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and the related notes included elsewhere in this Form 10-K.

The unaudited pro forma Condensed Consolidated Statement of Operations may not be indicative of the results of operations that would have occurred had the Reorganization or the IPO and related transactions, as applicable, taken place on the dates indicated, or that may be expected to occur in the future.

The adjustments are described in the notes to the unaudited pro forma Condensed Consolidated Statement of Operations.

The unaudited pro forma Condensed Consolidated Financial Information and other data should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our Consolidated Financial Statements and the related notes included elsewhere in this Annual Report on Form 10-K.

The pro forma adjustments in the “Reorganization and Other Transaction Adjustments” column principally give effect to certain of the Reorganization and other transactions including:

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• The TPG Operating Group transferred to RemainCo the economic entitlements associated with certain other investments that are part of the Excluded Assets.

• The transfer of certain investments in TPG Funds (as defined herein) to RemainCo resulted in the deconsolidation of those TPG Funds that have been consolidated in our historical combined financial statements with the exception of our Public SPACs.

• The transfer of certain investments in TPG Funds to RemainCo resulted in the deconsolidation of those TPG Funds that have been consolidated in our historical combined financial statements with the exception of our Public SPACs.

• Adjustments to sharing percentages of future profits between controlling and non-controlling interests of the TPG Operating Group related to the Specified Company Assets.

• The deconsolidation of our former affiliate.

The pro forma adjustments in the “Offering Transaction Adjustments” column principally give effect to the consummation of the IPO, including the corporate conversion.

We have not made any pro forma adjustments relating to any incremental reporting, compliance or investor relations costs that we may incur as a public company, as estimates of such expenses are not determinable.

The unaudited pro forma condensed consolidated financial information should be read together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the historical financial statements and related notes included elsewhere in this Form 10-K.

The unaudited pro forma condensed consolidated financial information is included for informational purposes only and does not purport to reflect the results of operations or financial position of TPG that would have occurred had the transactions described above transpired on the dates indicated or had we operated as a public entity during the periods presented or for any future period or date.

The unaudited pro forma condensed consolidated financial information should not be relied upon as being indicative of our future or actual results of operations or financial condition had the Reorganization and IPO transactions described under “Organizational Structure” and the other transactions described above occurred on the dates assumed.

The unaudited pro forma condensed consolidated financial information also does not project our results of operations or financial position for any future period or date.

Unaudited Pro Forma Condensed Consolidated Statement of Financial Condition

As of December 31, 2021

($ in thousands) TPG Group Holdings Historical Reorganization and Other Transaction Adjustments Offering Transaction and Other Adjustments TPG Inc.

Cash and cash equivalents $ 972,729 $ (27,200) (1) $ 820,721 (3) $ 1,376,746

(380,143) (3)

Restricted cash 13,135 — — 13,135

Due from affiliates 185,321 — — 185,321

Investments 6,109,046 — — 6,109,046

Right-of-use assets 157,467 — — 157,467

Other assets, net 499,850 — (23,988) (8) 475,862

Assets of consolidated TPG Funds and Public SPACs:

Cash and cash equivalents 5,371 — — 5,371

Assets held in Trust Account 1,000,027 — — 1,000,027

Investments — — — —

Due from affiliates 74 — — 74

Other assets, net 18,993 — — 18,993

Total assets $ 8,962,013 $ (27,200) $ 407,229 $ 9,342,042

Liabilities and Partners' Capital

Accounts payable and accrued expenses $ 134,351 $ — $ — $ 134,351

Due to affiliates 826,999 (203,286) (1) 10,611 (6) 634,324

Secured borrowings, net 244,950 — — 244,950

Senior unsecured term loan 199,494 — — 199,494

Accrued performance allocation compensation — 3,848,126 (2) 3,848,126

Operating lease liability 177,003 — — 177,003

Other liabilities, net 61,243 — (24,171) (8) 37,072

Liabilities of consolidated TPG Funds and Public SPACs:

Accounts payable and accrued expenses 8,484 — — 8,484

Derivative liabilities of Public SPACs 13,048 — — 13,048

Deferred underwriting 35,000 — — 35,000

Total liabilities 1,700,572 3,644,840 (13,560) 5,331,852

Commitments and contingencies

Redeemable equity attributable to consolidated Public SPACs 1,000,027 — — 1,000,027

Class A common stock — — 79 (4) 79

Class B common stock — — 230 (5) 230

Additional paid-in-capital — — 498,251 (7) 498,251

Partners’ capital controlling interests 1,606,593 (439,196) (1) (1,167,397) (9) —

Retained earnings — — — —

Total partners' /stockholders' equity attributable to TPG Inc.

1,606,593 (439,196) (668,837) 498,560

Non-controlling interests in consolidated TPG Funds — — —

Other non-controlling interests 4,654,821 615,282 (1) 1,089,626 (9) 2,511,603

(3,848,126) (2)

Total equity 6,261,414 (3,672,040) 420,789 3,010,163

Total liabilities, redeemable equity, and equity $ 8,962,013 $ (27,200) $ 407,229 $ 9,342,042

Notes to the Unaudited Pro Forma Condensed Consolidated Statement of Financial Condition

1) The TPG Operating Group transferred to RemainCo certain performance allocation economic entitlements from certain of the TPG general partner entities that are defined as Excluded Assets, as well as certain cash and due to affiliate amounts at the TPG Operating Group that relate to these TPG general partner entities’ economic entitlements.

We continue to consolidate these TPG general partner entities because we maintain control and have an implicit variable interest.

These transfers resulted in the reduction of cash of $27.2 million and due to affiliate amounts of $203.3 million, which increased partners’ capital by $148.5 million and non-controlling interests of $27.6 million.

In addition, the transfer of performance allocation economic entitlements resulted in a transfer of $587.7 million from partners' capital to non-controlling interests.

2) This adjustment relates to accrued performance allocation amounts owed to our partners and professionals.

Prior to the Reorganization and the IPO, the entities that comprise the consolidated financial statements of TPG Group Holdings have been partnerships or limited liability companies, and our senior professionals were part of the ownership group of those entities.

As such, their share of accrued performance allocations was reflected within “other non-controlling interests” on the TPG Group Holdings consolidated statement of financial condition, as these interests existed through the individuals’ ownership interests, and the income attributable to these performance allocation rights were included in “net income attributable to other non-controlling interests” on the TPG Group Holdings consolidated statement of operations.

Additionally, we have adjusted the sharing percentages associated with certain performance allocations between our controlling and non-controlling interest holders, which resulted in an increase to amounts attributable to our historic non-controlling interest holders and a further increase to accrued performance allocation compensation.

As of December 31, 2021, the carrying value of these performance allocations totaled approximately $3,848.1 million.

An adjustment has been recorded to reclassify this balance from other non-controlling interests to a liability on the unaudited pro forma condensed consolidated statement of financial condition.

Subsequent to the Reorganization, the amounts owed to our senior professionals will be treated as compensatory profit-sharing arrangements and reflected as a liability on our unaudited pro forma condensed consolidated statement of financial condition.

3) The adjustment reflects i) proceeds, net of estimated underwriting discounts, of $820.7 million from the IPO based on the issuance of 30,085,604 shares of Class A common stock at the IPO price of $29.50 per share, with a corresponding increase to additional paid-in capital and (ii) of the proceeds noted above, we intend to use approximately $380.1 million to purchase Common Units from certain existing owners of the TPG Operating Group (none of whom is an active TPG partner or Founder), at the IPO price of $29.50 per share paid by the public for shares of our Class A common stock in the IPO.

4) Reflects 70,811,664 shares of Class A common stock and 8,258,901 shares of nonvoting Class A common stock with a par value of $0.001 outstanding immediately after the IPO.

This includes 30,085,604 shares of our Class A common stock issued in the IPO to new investors and 40,726,060 shares of Class A common stock and 8,258,901 shares of nonvoting Class A common stock received in exchange for Common Units by the holders of Common Units (other than TPG Inc.).

5) In connection with the IPO, we issued 229,652,641 shares of Class B common stock with a par value of $0.001 to the TPG Operating Group owners, other than us or our wholly-owned subsidiaries, on a one-to-one basis with the number of Common Units they own across each of the three TPG Operating Group entities.

Each share of our Class B common stock will entitle its holder to ten votes.

As part of the IPO and pursuant to the Exchange Agreement, each Common Unit that is not held by us or our wholly-owned subsidiaries is exchangeable for either (i) cash equal to the value of one share of Class A common stock from a substantially concurrent public offering or private sale based on the closing price per share of the Class A common stock on the day before the pricing of such public offering or private sale (taking into account customary brokerage commissions or underwriting discounts actually incurred);

or (ii) at our election, for one share of our Class A common stock (or, in certain cases, for shares of nonvoting Class A common stock).

We are reflecting the TPG Operating Group Common Units held by our affiliates as non-controlling interests on the unaudited pro forma condensed consolidated statement of financial condition since they relate to equity in the TPG Operating Group that is not attributable to us.

6) In connection with the IPO, we entered into the Tax Receivable Agreement with certain of our pre-IPO owners that provides for the payment by us (or our subsidiary) to such pre-IPO owners of 85% of cash tax savings, if any, that we actually realize, or we are deemed to realize (calculated using certain assumptions) as a result of the Covered Tax Items.

We will retain the benefit of the remaining 15% of these net cash tax savings under the Tax Receivable Agreement.

Pursuant to the Corporate Conversion and the IPO, $10.6 million was recognized in due to affiliates for the Tax Receivable Agreement, which assumes:

(i) only exchanges associated with the IPO, (ii) a share price equal to $29.50 per share less any underwriting discounts and commissions, (iii) a constant U.S.

federal and state income tax rate of 23.0% (iv) no material changes in tax law, (v) the ability to utilize tax attributes, (vi) no adjustment for potential remedial allocations and (vii) future Tax Receivable Agreement payments.

The impact of the Tax Receivable Agreement liability is reflected within additional paid-in capital.

7) The computation of the pro forma additional paid-in capital is shown below:

($ in thousands) Offering Transaction Adjustments

Proceeds from offering net of underwriting discounts and unpaid offering costs $ 820,721

Exchange of Common Units for Class A common stock and nonvoting Class A common stock (a)

Reclassification of Partners' Capital to Additional paid-in capital 1,167,397

Due to affiliates for Tax Receivable Agreement (10,611)

Other liabilities, net for deferred tax liability 23,988

Par value of Class A common stock and nonvoting Class A common stock (79)

Par value of Class B common stock (230)

Non-controlling interests in TPG Operating Group (b)

Additional paid-in capital $ 498,251

(a) The exchange of Common Units for Class A common stock and nonvoting Class A common stock represents the 40,726,060 shares of Class A common stock and 8,258,901 shares of nonvoting Class A common stock issued by us in exchange for Common Units held by certain of our existing owners.

(b) Non-controlling interest in the TPG Operating Group represents the reallocation of net assets of the TPG Operating Group between TPG Inc.

and other non-controlling interest holders.

8) We are deferring certain costs associated with this offering, including certain legal, accounting and other related expenses, which have been recorded in other assets, net in our unaudited pro forma condensed consolidated statement of financial condition.

Upon completion of the IPO, we incurred approximately $31.8 million of offering costs that will be reflected as a reduction to additional paid-in capital, of which $24.2 million was recorded to other assets, net as of December 31, 2021.

The remaining $9.4 million of unpaid offering costs are presented as an offset to proceeds from the IPO.

We may incur additional costs through the completion of this offering which we expect to be settled in cash with the proceeds from this offering.

9) Following the IPO, we hold approximately 25.6% of the Common Units and 100% of the interests in certain intermediate holding companies.

As a result, we continue to consolidate the financial results of the TPG Operating Group and report non-controlling interests related to the interests held by the other partners of the TPG Operating Group, which represents a majority of the economic interest in the TPG Operating Group on our consolidated statement of financial condition.

The computation of the pro forma adjustments to non-controlling interests is below:

($ in thousands) Offering Transaction Adjustments

Exchange of Common Units for Class A common stock (a)

$ (1,260,695)

Non-controlling interests in TPG Operating Group (b)

Non-controlling interests $ 1,089,626

(b) Non-controlling interest in the TPG Operating Group represents the reallocation of net assets of the TPG Operating Group between TPG Inc.

and other non-controlling interest holders.

The unaudited pro forma condensed consolidated financial information is included for informational purposes only and does not purport to reflect the results of operations of TPG that would have occurred had the transactions described above transpired on the dates indicated or had we operated as a public entity during the period presented or for any future period or date.

The unaudited pro forma condensed consolidated financial information should not be relied upon as being indicative of our future or actual results of operations had the Reorganization and IPO transactions and the other transactions described above occurred on the dates assumed.

The unaudited pro forma condensed consolidated financial information also does not project our results of operations for any future period or date.

Unaudited Pro Forma Condensed Consolidated Statement of Operations and Other Data

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Compensation and benefits:

Cash-based compensation and benefits 579,698 (140,278) (5) — 439,420

Equity-based compensation — — 428,687 (6) 500,607

Performance allocation compensation — 2,538,505 (5) — 2,538,505

Total compensation and benefits 579,698 2,398,227 500,607 3,478,532

General, administrative and other 278,590 — — 278,590

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Income from investments:

Net gains (losses) from investment activities 353,219 (92,860) (1) — 260,359

Net gains from investment activities 353,219 (92,860) (1) — 260,359

Interest, dividends and other 6,460 — — 6,460

Investment income of consolidated TPG Funds and Public SPACs:

Net gains (losses) from investment activities 23,392 (23,392) (1) —

Unrealized losses on derivative liabilities of Public SPACs 211,822 — — 211,822

Net gains from investment activities 23,392 (23,392) (1) — —

Unrealized gains on derivative liabilities of Public SPACs 211,822 — — 211,822

Interest, dividends and other 10,321 (4,029) (1) — 6,292

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Net income 4,655,997 (2,507,976) (569,548) 1,578,473

Net income (loss) attributable to redeemable equity in Public SPACs 155,131 — 155,131

Net income (loss) attributable to non-controlling interests in consolidated TPG Funds 19,287 (19,287) (1) — —

Net income (loss) attributable to other non-controlling interests 2,455,825 127,140 (1) 226,650 (10) 1,191,994

Net income attributable to redeemable equity in Public SPACs 155,131 — — 155,131

Net income attributable to non-controlling interests in consolidated TPG Funds 19,287 (19,287) (1) — —

Net income attributable to other non-controlling interests 2,455,825 127,140 (1) 226,650 (10) 1,191,994

(2,516,546) (5)

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$ 2,025,754 $ (998,208) $ (796,198) (11) $ 231,348

TPG Group Holdings Historical Reorganization and Other Transaction Adjustments Offering Transaction Adjustments TPG Inc.

Pro forma net income per share data:

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Compensation and benefits:

Cash-based compensation and benefits 522,715 (45,088) (1) — 363,930

(113,697) (5)

Equity-based compensation — — 579,207 (6) 657,042

Performance allocation compensation — 721,097 (5) — 721,097

Total compensation and benefits 522,715 562,312 657,042 1,742,069

General, administrative and other 260,748 (33,885) (1) 19,496 (8) 246,359

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Interest expense 18,993 (612) (1) — 22,372

Expenses of consolidated TPG Funds and Public SPACs:

Expenses of consolidated entities:

Interest expense 722 (722) (1) — —

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Income from investments:

Net (losses) gains from investment activities (5,839) 5,839 (1) — —

Net losses from investment activities (5,839) 5,839 (1) — —

Gain on deconsolidation 401,695 (401,695) (1)

Interest, dividends and other 8,123 (3,114) (1) — 5,009

Investment income of consolidated TPG Funds and Public SPACs:

Net (losses) gains from investment activities (18,691) 18,691 (1) — —

Unrealized losses on derivative liabilities of Public SPACs (239,269) — — (239,269)

Investment income of consolidated entities:

Net gains from investment activities (18,691) 18,691 (1) — —

Unrealized gains on derivative liabilities (239,269) — — (239,269)

Interest, dividends and other 5,410 (5,399) (1) — 11

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Net income 1,438,932 (822,810) (699,718) (83,596)

Net loss attributable to redeemable equity in Public SPACs (195,906) — (195,906)

Net (loss) income attributable to non-controlling interests in consolidated TPG Funds (12,380) 12,380 (1) — —

Net income (loss) attributable to other non-controlling interests 719,640 8,672 (1) (359,307) (10) 28,239

Net loss attributable to redeemable equity in consolidated entities (195,906) — — (195,906)

Net income attributable to non-controlling interests in consolidated TPG Funds (12,380) 12,380 (1) — —

Net income attributable to other non-controlling interests 719,640 8,672 (1) (359,307) (10) 28,239

(703,376) (5)

2 unchanged sentences

TPG Group Holdings Historical Reorganization and Other Transaction Adjustments Offering Transaction Adjustments TPG Inc.

Pro forma net income (loss) per share data:

Pro forma net income per share data:

Weighted-average shares of Class A common stock outstanding

1 unchanged sentence

Diluted 308,907,578

Net income (loss) available to Class A common stock per share

Net income available to Class A common stock per share

Diluted $ (0.42)

2 unchanged sentences

Impact of changes in economics of certain TPG general partner interests in TPG Funds:

The TPG Operating Group transferred to RemainCo certain performance allocation economic entitlements from certain of the TPG general partner entities that are defined as Excluded Assets, as well as certain cash and amounts due to affiliates at the TPG Operating Group that relate to these TPG general partner entities’ economic entitlements.

The TPG Operating Group transferred to RemainCo certain performance allocation economic entitlements from certain of the TPG general partner entities that are defined as Excluded Assets, as well as certain cash and amounts due to affiliates of the TPG Operating Group that relate to these TPG general partner entities’ economic entitlements.

We continue to consolidate these TPG general partner entities because we maintain control and have an implicit variable interest.

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The TPG Operating Group also transferred the economic entitlements associated with certain other investments, including our investment in our former affiliate.

For the year ended December 31, 2021, the impact results in the exclusion of total revenues of $8.7 million and investment income of $92.9 million with a reduction to net income attributable to controlling interests of $85.6 million and non-controlling interest of $16.0 million.

For the year ended December 31, 2021, the impact results in the exclusion of total revenues of $8.7 million and the exclusion of investment income of $92.9 million with a reduction to net income attributable to controlling interests of $85.6 million and non-controlling interest of $16.0 million.

For the year ended December 31, 2020, the impact results in the exclusion of total revenues of $74.7 million, expenses of $80.0 million and investment income of $399.0 million with a reduction to net income attributable to controlling interests of $231.2 million and non-controlling interest of $13.4 million.

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Interest expense — — — (612) — (612)

Expenses of consolidated TPG Funds:

Expenses of consolidated TPG Funds and Public SPACs:

Interest expense — (740) (740) — (722) (722)

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Income from investments:

Net gains (losses) from investment activities (92,860) (92,860) 5,839 — 5,839

Net losses (gains) from investment activities (92,860) — (92,860) 5,839 5,839

Gain on deconsolidation — — — (401,695) (401,695)

Interest, dividends and other — — — (3,114) — (3,114)

Investment income of consolidated TPG Funds:

Investment income of consolidated TPG Funds and Public SPACs:

Net gains (losses) from investment activities — (23,392) (23,392) — 18,691 18,691

Unrealized losses on derivative liabilities — — — — — —

Unrealized gains (losses) on derivative liabilities Public SPACs — — — — — —

Interest, dividends and other — (4,029) (4,029) — (5,399) (5,399)

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Subject to certain exceptions, we expect RemainCo to be entitled to between 10% and 15% of these Specified

Company Assets’ related performance allocations, which we will treat as non-controlling interests, and to allocate generally between 65% and 70% indirectly to our partners and professionals through performance allocation vehicles and Promote Units, with the remaining 20% available for distribution to the TPG Operating Group Common Unit holders.

Company Assets’ related performance allocations, which we treat as non-controlling interests, and to allocate generally between 65% and 70% indirectly to our partners and professionals through performance allocation vehicles and Promote Units, with the remaining 20% available for distribution to the TPG Operating Group Common Unit holders.

RemainCo’s entitlement to performance allocations associated with future funds will step down over time.

See “Certain Relationships and Related Party Transactions—Proposed Transactions—RemainCo Performance Earnings Agreement.” In conjunction with allocating between 65% and 70% of performance allocations associated with the Specified Company Assets to our partners and professionals, we will reduce the amount of cash-based bonuses historically paid to these individuals as further described in Note 5 below.

In conjunction with allocating between 65% and 70% of performance allocations associated with the Specified Company Assets to our partners and professionals, we have reduced the amount of cash-based bonuses historically paid to these individuals as further described in Note 5 below.

The primary impact of this is a reallocation from income attributable to controlling interests to income attributable to non-controlling interests.

Specifically, this adjustment reflects reclassifications of $896.3 million and $360.6 million for the years ended December 31, 2021 and 2020, respectively, from net income attributable to controlling interests to net income attributable to other non-controlling interests.

3) This amount reflects an administrative services fee that we will receive for managing the Excluded Assets to be transferred to RemainCo that will not be part of the TPG Operating Group.

3) This amount reflects an administrative services fee that we receive for managing the Excluded Assets transferred to RemainCo that are not part of the TPG Operating Group.

The fee is based on 1% of the net asset value of RemainCo.

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The Senior Unsecured Term Loan carries an interest rate of LIBOR plus 1.00% and matures in December 2024.

The impact of the adjustment is an increase to interest expense of $4.0 million with a corresponding impact to net income attributable to controlling interests and non-controlling interest holders, for the years ended December 31, 2021 and 2020.

5) Reflects the reclassification of performance allocation amounts owed to senior professionals from other non-controlling interests to performance allocation compensation.

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As described in Note 2 above, we have adjusted our performance allocation sharing percentage and in conjunction with allocating between 65% and 70% of performance allocations associated with the Specified Company Assets to certain of our people, we are reducing the amounts of cash-based bonuses and increasing the performance allocation compensation expense.

For the year ended December 31, 2021, the impact to the unaudited pro forma condensed consolidated statement of operations included additional performance allocation compensation of $2,398.2 million with a corresponding reduction to net income attributable to non-controlling interest and a reduction of $140.3 million from compensation and benefits with a corresponding increase to net income attributable to controlling and non-controlling interest of $118.3 million and $22.0 million, respectively.

For the year ended December 31, 2021, the impact to the unaudited pro forma Condensed Consolidated Statement of Operations included additional performance allocation compensation of $2,398.2 million with a corresponding reduction to net income attributable to non-controlling interest and a reduction of $140.3 million from cash-based compensation and benefits with a corresponding increase to net income attributable to controlling and non-controlling interest of $118.3 million and $22.0 million, respectively.

Amounts have been derived based upon our historical results.

For the year ended December 31, 2020, the impact to the unaudited pro forma condensed consolidated statement of operations included additional increase to performance allocation compensation of $607.4 million with a corresponding reduction to net income attributable to non-controlling interest and a reduction of $113.7 million from compensation with a corresponding increase to net income attributable to controlling and non-controlling interest of $96.0 million and $17.7 million, respectively.

For the year ended December 31, 2020, the impact to the unaudited pro forma Condensed Consolidated Statement of Operations included additional performance allocation compensation of $607.4 million with a corresponding reduction to net income attributable to non-controlling interest and a reduction of $113.7 million from cash-based compensation and benefits with a corresponding increase to net income attributable to controlling and non-controlling interest of $96.0 million and $17.7 million, respectively.

Amounts have been derived based upon our historical results.

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No changes were made to the terms of the unvested units.

TPG Partner Holdings and RemainCo will both be presented as non-controlling interest holders within our consolidated financial statements.

We intend to account for the TPG Partner Holdings units and indirect economic interests in RemainCo as compensation expense in accordance with Accounting Standards Codification Topic 718 Compensation – Stock Compensation.

TPG Partner Holdings and RemainCo are both presented as non-controlling interest holders within our Consolidated Financial Statements.

We account for the TPG Partner Holdings units and indirect economic interests in RemainCo as compensation expense in accordance with ASC Topic 718, Compensation – Stock Compensation.

The unvested TPG Partner Holdings units and unvested indirect economic interests in RemainCo will be charged to compensation and benefits as they vest over the remaining requisite service period on a straight-line basis.

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Therefore, we have allocated these expense amounts to our non-controlling interest holders.

See “Certain Relationships and Related Party Transactions—Proposed Transactions—The TPG Operating Group Limited Partnership Agreements” for additional details on RemainCo.

7) In connection with the IPO, we granted to certain of our people RSUs with respect to approximately 9,280,000 shares of Class A common stock (although we are authorized to grant up to 4% of our shares of Class A common stock, measured on a fully-diluted, as converted basis, which would be 12,277,912 shares of Class A common stock).

7) At IPO, we granted to certain of our people RSUs with respect to approximately 9,280,000 shares of Class A common stock (although we are authorized to grant up to 4% of our shares of Class A common stock, measured on a fully-diluted, as converted basis, which would be 12,277,912 shares of Class A common stock).

Of these RSUs, we granted 8,229,960 shares of Class A common stock immediately following the completion of the IPO.

These RSUs generally vest over four years in three equal installments on the second through fourth anniversaries of the grant date (with some grants vesting on shorter alternate vesting schedules), subject to the recipient’s continued provision of services to the Company or its affiliates through the vesting date.

In addition, under the TPG Inc.

Omnibus Equity Incentive Plan, which was approved by our board of directors on December 7, 2021 (the “Omnibus Plan”), (refer to Exhibit 10.21 within Form 10-K), we granted immediately following the IPO long-term performance incentive awards to certain of our key executives in the form of RSUs (certain of which have performance-vesting criteria) with respect to a total of 2,203,390 shares of Class A common stock.

In addition, under TPG Inc.’s Omnibus Equity Incentive Plan, which was approved by our board of directors on December 7, 2021 and our shareholders on December 20, 2021 (the “Omnibus Plan”), we granted immediately following the IPO long-term performance incentive awards to certain of our key executives in the form of RSUs (certain of which have performance-vesting criteria) with respect to a total of 2,203,390 shares of Class A common stock.

Furthermore, we have currently named two of our three independent directors, and granted RSUs to the two named independent directors with respect to 20,340 shares of Class A common stock, immediately following the IPO.

This adjustment reflects compensation expense associated with the grants described above had they occurred at the beginning of the period presented.

This adjustment reflects compensation expense associated with the grants described above had they occurred at January 1, 2020.

The grants of such RSUs results in recognition of compensation expense for the years ended December 31, 2021 and 2020 in the amount of $71.9 million and $77.8 million, respectively.

These expenses are non-cash in nature and allocated to the Common Unit holders.

Not included in the above Offering Transaction Adjustment are RSUs (which are part of the RSUs with respect to approximately 9,280,000 shares of Class A common stock referred to above) with respect to 1,050,040 shares that will be granted in 2022 after the IPO, including those to people hired for new roles created in connection with the IPO.

Not included in the above Offering Transaction Adjustment are RSUs (which are part of the RSUs with respect to approximately 9,280,000 shares of Class A common stock referred to above) with respect to 1,050,040 shares that were granted in 2022 after the IPO, including those to people hired for new roles created in connection with the IPO.

In addition, we plan to grant RSUs of 10,170 shares to our third independent director when named.

These additional grants will have similar vesting terms and conditions as the RSUs mentioned above.

8) We have estimated we will incur approximately $19.5 million in additional non-recurring transaction and Reorganization related costs in connection with the IPO.

8) We incurred approximately $19.5 million in additional non-recurring transaction and Reorganization related costs in connection with the IPO.

These amounts are not directly related to the issuance of securities in the IPO but are related to the Reorganization and have been reflected as an adjustment in the unaudited pro forma condensed consolidated statement of operations for the year ended December 31, 2020.

9) The TPG Operating Group partnerships have been and are expected to continue to be treated as partnerships for U.S.

9) The TPG Operating Group partnerships continue to be treated as partnerships for U.S.

federal and state income tax purposes.

Following the IPO, we are subject to U.S.

federal income taxes, in addition to state, local and foreign income taxes with respect to our allocable share of any taxable income generated by the TPG Operating Group that will flow through to its interest holders, including us.

federal income taxes, in addition to state, local and foreign income taxes with respect to our allocable share of any taxable income generated by the TPG Operating Group that flows through to its interest holders, including us.

As a result, the unaudited pro forma Condensed Consolidated Statement of Operations reflects adjustments to our income tax expense to reflect a blended statutory tax rate of 23% at TPG, which was calculated assuming the U.S.

federal rates currently in effect and the statutory rates applicable to each state, local and foreign jurisdiction where we estimate our income will be apportioned.

The following table summarizes the impact for the periods presented:

The following table summarizes the impact for the period presented:

Year Ended December 31, 2021 Year Ended December 31, 2020

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($ in thousands) Offering Transaction Adjustment

Income (loss) before provision for income taxes $ 1,656,452 $ (50,334)

Income before provision for income taxes $ 1,656,452 $ (50,334)

Provision for local and foreign income taxes 9,038 10,082

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As a result, we consolidate the financial results of the TPG Operating Group and its consolidated subsidiaries and report non-controlling interests related to the interests held by the other partners of the TPG Operating Group and its consolidated subsidiaries in our consolidated statements of operations.

Following the IPO, TPG owns 25.6% of the Common Units, and the other partners of the TPG Operating Group will own the remaining 74.4%, excluding the equity-based compensation expense related to our partners’ unvested TPG Partner Holdings units and indirect economic interests in RemainCo, which has been allocated only to non-controlling interest holders.

Net income attributable to non-controlling interests will represent 74.4% of the consolidated income before taxes of the TPG Operating Group.

Following the IPO, TPG owns 25.6% of the Common Units, and the other partners of the TPG Operating Group own the remaining 74.4%, excluding the equity-based compensation expense related to our partners’ unvested TPG Partner Holdings units and indirect economic interests in RemainCo, which has been allocated only to non-controlling interest holders.

Net income attributable to non-controlling interests represent 74.4% of the consolidated income before taxes of the TPG Operating Group.

Promote Units are not included in this calculation of ownership interest.

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Provision for local and foreign income taxes 9,038 10,082

Net income (loss) attributable to redeemable interest in Public SPACs 155,131 (195,906)

Net (loss) income attributable to redeemable interest in Public SPACs 155,131 (195,906)

Allocable Income 1,992,890 812,028

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($ in thousands) Offering Transaction Adjustment

Income (loss) before provision for income taxes $ 1,656,452 $ (50,334)

Income before provision for income taxes $ 1,656,452 $ (50,334)

Provision for local and foreign income taxes 77,979 33,262

Net income (loss) attributable to redeemable interest in Public SPACs 155,131 (195,906)

Net (loss) income attributable to redeemable interest in Public SPACs 155,131 (195,906)

Allocable Income 1,423,342 112,310

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11) Pro forma basic net income per share is computed by dividing net income available to Class A common stockholders by the weighted-average shares of Class A common stock outstanding during the period.

The weighted-average shares outstanding excludes shares of Class A common stock reserved for issuance under the Omnibus Plan equal to 10% of our shares of Class A common stock, measured on a fully-diluted, as converted basis, including that we intend to grant up to 4% to certain of our people in connection with the IPO, as well as certain long-term performance incentive awards and awards to our independent directors.

We anticipate that a portion of the RSUs we intend to grant to certain of our people in connection with the offering will be granted immediately following the effectiveness of the IPO and a portion may be granted thereafter in 2022 in relation to the IPO, including to people hired for new roles created in connection with the IPO.

The weighted-average shares outstanding excludes shares of Class A common stock reserved for issuance under the Omnibus Plan equal to 10% of our shares of Class A common stock, measured on a fully-diluted, as converted basis, including that we granted up to 4% to certain of our people in connection with the IPO, as well as certain long-term performance incentive awards and awards to our independent directors.

We anticipate that a portion of the RSUs we granted to certain of our people in connection with the offering were granted immediately following the effectiveness of the IPO and a portion may be granted thereafter in 2022 in relation to the IPO, including to people hired for new roles created in connection with the IPO.

Pro forma diluted net income per share is computed by adjusting the net income available to Class A common stockholders and the weighted-average shares of Class A common stock outstanding to give effect to potentially dilutive securities.

The calculation of diluted earnings per share excludes Class B common stock, which may only be held by the TPG Operating Group owners other than us

or our wholly-owned subsidiaries and their respective permitted transferees, and are therefore not included in the computation of pro forma basic or diluted net income per share.

The calculation of diluted earnings per share excludes Class B common stock, which may only be held by the TPG Operating Group owners other than us or our wholly-owned subsidiaries and their respective permitted transferees, and are therefore not included in the computation of pro forma basic or diluted net income per share.

12) The following table sets forth a reconciliation of the numerators and denominators used to compute pro forma basic and diluted net income per share.

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Pro forma basic net income per share:

Net income (loss) $ 1,578,473 $ (83,596)

Net income $ 1,578,473 $ (83,596)

Net income attributable to participating securities 23,089 8,513

Net income (loss) attributable to redeemable interests in Public SPACs 155,131 (195,906)

Net (loss) income attributable to redeemable interests in Public SPACs 155,131 (195,906)

Net income attributable to interests in other non-controlling interest 1,169,357 20,132

Net income (loss) attributable to Class A common stockholders – Basic $ 230,896 $ 83,665

Net income attributable to Class A common stockholders – Basic $ 230,896 $ 83,665

Shares of Class A common stock outstanding – Basic 79,360,700 79,254,937

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Pro forma diluted net income per share:

Net income (loss) attributable to Class A common stockholders – Basic $ 230,896 $ 83,665

Reallocation of net income (loss) assuming exchange of Common Units to Class A common stocks 324,052 (212,355)

Net income (loss) attributable to Class A common stockholders – Diluted $ 554,948 $ (128,690)

Net income attributable to Class A common stockholders – Basic 230,896 83,665

Reallocation of net income assuming exchange of Common Units to Class A common stock 324,052 (212,355)

Net income attributable to Class A common stockholders – Diluted $ 554,948 $ (128,690)

Weighted-average shares of Class A common stock outstanding – Basic 79,360,700 79,254,937

Vesting of restricted share awards — —

Exchange of Common Units to Class A common stocks 229,652,641 229,652,641

Exchange of Common Units to Class A common stock 229,652,641 229,652,641

Weighted-average shares of Class A common stock outstanding – Diluted 309,013,341 308,907,578

Diluted net income (loss) per share:

Diluted net income per share:

$ 1.80 $ (0.42)

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Unaudited Pro Forma Non-GAAP Financial Measures

The following table sets forth our non-GAAP and pro forma non-GAAP financial measures after Offering Transaction Adjustments for the year ended December 31, 2021:

The following table sets forth our non-GAAP and pro forma non-GAAP financial measures after Reorganization and Offering Transaction Adjustments for the years ended December 31, 2021 and 2020:

Year Ended December 31, 2021 Year Ended December 31, 2020

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1) The difference in other income between non-GAAP and pro forma non-GAAP financial measures is attributable to:

(i) removing the other income associated with the other investments that were transferred to RemainCo and (ii) an administrative services fee that we will receive for managing the Excluded Assets transferred to RemainCo that are not part of the TPG Operating Group.

(i) removing the other income associated with the other investments that were transferred to RemainCo and (ii) an administrative services fee that we receive for managing the Excluded Assets transferred to RemainCo that are not part of the TPG Operating Group.

The fee is based on 1% of the net asset value of RemainCo.

2) This adjustment reflects the reduction of our cash-based bonuses we historically paid to our partners and professionals within compensation and benefits, net.

2) This adjustment reflects the expected reduction of our cash-based bonuses relative to what we historically paid to our partners and professionals within compensation and benefits, net.

Through the Reorganization, we have increased certain of our people’s share of performance allocations associated with the Specified Company Assets from approximately 50% to between 65% and 70%.

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3) Realized performance allocations, net only include the amounts the TPG Operating Group is entitled to after gross realized performance allocations has been reduced by realized performance allocation compensation and non-controlling interests.

Following the Reorganization, the TPG Operating Group will receive approximately 20% of the future performance allocations associated with the general partner entities that retained an economic interest in.

This adjustment to our sharing percentage was made to allow us to reduce cash-based bonuses paid to our partners.

Following the Reorganization, the TPG Operating Group receives approximately 20% of the future performance allocations associated with the general partner entities that we retained an economic interest in.

This adjustment to our sharing percentage was made to allow us to reduce amounts we would expect to pay out as discretionary cash bonuses in the future paid to our partners.

The impact of this adjustment is a decrease in realized performance allocations, net of $794.9 million and $272.7 million for the years ended December 31, 2021 and 2020, respectively.

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The distribution was made with $200.0 million proceeds from the senior unsecured term loan issuance.

Senior Unsecured Term Loan carries an interest rate of LIBOR plus 1.00% and matures in December 2024.

The Senior Unsecured Term Loan carries an interest rate of LIBOR plus 1.00% and matures in December 2024.

The impact of the adjustment is an increase to interest expense of $4.0 million for the years ended December 31, 2021 and 2020.

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Additionally, the book assets, book liabilities and net book value include the tax assets and liabilities of TPG Inc.

Following the Reorganization and the IPO, we plan to utilize these measures to assess the unrealized value of our book assets after deducting for book liabilities and as well as assess our indirect interest in accrued performance allocations from our TPG Funds and our co-investments in TPG Funds and third-party investments.

We believe these measures will be useful to investors as they will provide additional insight into the net assets of the TPG Operating Group on a deconsolidated basis.

These non-GAAP financial measures should not be considered as a substitute for, or superior to, similar financial measures calculated in accordance with GAAP.

We utilize these measures to assess the unrealized value of our book assets after deducting for book liabilities as well as assess our indirect interest in accrued performance allocations from our TPG Funds and our co-investments in TPG Funds and third-party investments.

We believe these measures are useful to investors as they provide additional insight into the net assets of the TPG Operating Group on a deconsolidated basis.

These non-GAAP financial measures should not be considered as a substitute for, or superior to, similar financial measures calculated in accordance with U.S.

These non-GAAP financial measures may differ from the calculations of other alternative asset managers and, as a result, may not be comparable to similar measures presented by other companies.

The following table sets forth our pro forma non-GAAP book assets, book liabilities and book value after the IPO transaction adjustments as of December 31, 2021:

Certain comparative amounts for the prior fiscal period have been reclassified to conform to the below presentation as of December 31, 2022.

Refer to “––Reconciliation to U.S.

GAAP Measures” for reconciliations of the Condensed Consolidated Statement of Financial Condition to the non-GAAP Balance Sheet.

The following table sets forth our pro forma non-GAAP book assets, book liabilities and book value after the IPO transaction adjustments as of December 31, 2022 and 2021:

Year Ended December 31, 2021

(in thousands) Non-GAAP Pro Forma Non-GAAP

($ in thousands) December 31, 2022 Non-GAAP Pro Forma Non-GAAP

Cash and cash equivalents $ 691,687 $ 242,370 $ 646,387 (1), (2)

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Notes to the Unaudited Pro Forma Non-GAAP Balance Sheet Measures

1) The difference between non-GAAP and Pro Forma non-GAAP balance sheet measures relates to the transfer of Excluded Assets, which consist of rights to future performance allocations related to certain general partner entities as described in Note 1 in the Notes to the Unaudited Pro Forma Condensed Consolidated Statement of Financial Condition.

1) The difference between non-GAAP and pro forma non-GAAP balance sheet measures relates to the transfer of Excluded Assets, which consist of rights to future performance allocations related to certain general partner entities.

Additionally, certain of our other investments and investments into TPG Funds have been excluded, because such interests are not part of the TPG Operating Group.

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2) Includes $431.2 million of proceeds, net of estimated underwriting discounts and unpaid offering costs of $31.8 million, of which $24.0 million was previously capitalized and accrued in other assets, net and accounts payable, accrued expenses and other, respectively.

3) Following the Reorganization, the TPG Operating Group and Common Unit holders are expected to receive approximately 20% of the future performance allocations associated with the general partner entities that we retain an economic interest in as described in Note 2 above in the Notes to the Unaudited Pro Forma Condensed Consolidated Statement of Financial Condition.

3) Following the Reorganization, the TPG Operating Group and Common Unit holders received approximately 20% of the future performance allocations associated with the general partner entities that we retain an economic interest in as described in Note 1 above.

This adjustment reduces our share of accrued performance allocations by $575.1 million.

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5) Represents the impact to the net book value of the TPG Operating Group after the IPO transaction adjustments.

Reconciliations to GAAP Measures

The following table reconciles the most directly comparable financial measures calculated and presented in the Unaudited Pro Forma GAAP Statement of Operations to our Unaudited Non-GAAP Pro Forma financial measures for the years ended December 31, 2021 and 2020.

Reconciliations to U.S.

GAAP Measures

The following table reconciles the most directly comparable financial measures calculated and presented in the Unaudited Pro Forma U.S.

GAAP Statement of Operations to our Unaudited Non-GAAP Pro Forma financial measures for the years ended December 31, 2021 and 2020.

Year Ended December 31,

($ in thousands) 2021 2020

Total Pro Forma GAAP Net Income (loss) $ 1,578,473 $ (83,596)

Net income (loss) attributable to redeemable equity in Public SPACs (155,131) 195,906

Total Pro Forma GAAP Net Income $ 1,578,473 $ (83,596)

Net loss (income) attributable to redeemable equity in Public SPACs

(155,131) 195,906

Net income attributable to other non-controlling interests (756,925) (395,032)

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Unrealized investment income (232,988) (15,542)

Unrealized loss on derivatives (20,626) 9,570

Unrealized gains on derivatives (20,626) 9,570

Income tax expense 44,565 17,935

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Total Pro Forma Fee-Related Earnings $ 326,113 $ 226,566

The following tables provide reconciliations of Unaudited Pro Forma Assets and Liabilities measures to our Unaudited Non-GAAP Pro Forma Book Assets and Liabilities as of December 31, 2021.

($ in thousands) Year ended December 31, 2021

Total Pro Forma GAAP Assets $ 9,342,042

Impact of consolidated TPG Funds and Public SPACs (1,024,465)

Impact of other consolidated entities (5,306,966)

Impact of Promote Units (517,352)

Total Pro Forma Book Assets $ 2,493,259

Total Pro Forma GAAP Liabilities $ 5,331,852

Impact of consolidated TPG Funds and Public SPACs (56,532)

Accrued performance allocation compensation (3,848,126)

Impact of other consolidated entities (674,329)

Total Pro Forma Book Liabilities $ 752,865

Total Pro Forma GAAP Redeemable equity from consolidated Public SPACs $ 1,000,027

Impact of consolidated TPG Funds and Public SPACs (1,000,027)

Total Pro Forma GAAP Redeemable equity from consolidated Public SPACs $ —

Total Pro Forma GAAP Equity $ 3,010,163

Impact of consolidated TPG Funds and Public SPACs 32,094

Accrued performance allocation compensation 3,848,126

Impact of other consolidated entities (4,632,637)

Impact of Promote Units (517,352)

Total Pro Forma Net Book Value $ 1,740,394

Non-GAAP Financial Measures

Distributable Earnings.

DE is used to assess performance and amounts potentially available for distributions to partners.

DE is derived from and reconciled to, but not equivalent to, its most directly comparable GAAP measure of net income.

DE differs from GAAP net income computed in accordance with GAAP in that it does not include (i) unrealized performance allocations and related compensation and benefit expense, (ii) unrealized investment income, (iii) equity-based compensation expense, (iv) net income (loss) attributable to non-controlling interests in consolidated entities, or (v) certain non-cash items, such as contingent reserves.

While we believe that the inclusion or exclusion of the aforementioned GAAP income statement items provides investors with a meaningful indication of our core operating performance, the use of DE without consideration of the related GAAP measures is not adequate due to the adjustments described herein.

This measure supplements GAAP net income and should be considered in addition to and not in lieu of the results of operations presented accordance with GAAP discussed further under “—Key Components of our Results of Operations—Results of Operations” prepared in accordance with GAAP.

Distributable Earnings (“DE”) is used to assess performance and amounts potentially available for distributions to partners.

DE is derived from and reconciled to, but not equivalent to, its most directly comparable U.S.

GAAP measure of net income.

DE differs from U.S.

GAAP net income computed in accordance with U.S.

GAAP in that it does not include (i) unrealized performance allocations and related compensation and benefit expense, (ii) unrealized investment income, (iii) equity-based compensation expense, (iv) net income (loss) attributable to non-controlling interests in consolidated entities, or (v) certain non-cash items, such as contingent reserves.

While we believe that the inclusion or exclusion of the aforementioned U.S.

GAAP income statement items provides investors with a meaningful indication of our core operating performance, the use of DE without consideration of the related U.S.

GAAP measures is not adequate due to the adjustments described herein.

This measure supplements U.S.

GAAP net income and should be considered in addition to and not in lieu of the results of operations presented accordance with U.S.

GAAP discussed further under “—Key Components of our Results of Operations—Results of Operations” prepared in accordance with U.S.

After-Tax Distributable Earnings .

After-tax Distributable Earnings (“After-tax DE”) is a non-GAAP performance measure of our distributable earnings after reflecting the impact of income tax expense.

We use it to assess how income tax expense effects amounts available to be distributed to our partners.

After-tax DE differs from GAAP net income computed in accordance with GAAP in that it does not include the items described in the definition of DE herein;

however, unlike DE it does reflect the impact of income tax expense.

We believe that while the inclusion or exclusion of the aforementioned GAAP income statement items provides investors with a meaningful indication of our core operating performance, the use of After-tax DE without consideration of the related GAAP measures is not adequate due to the adjustments described herein.

This measure supplements GAAP net income and should be considered in addition to and not in lieu of the results of operations presented in accordance with GAAP discussed further under “—Key Components of our Results of Operations-Results of Operations.”

After-tax Distributable Earnings (“After-tax DE”) is a non-GAAP performance measure of our distributable earnings after reflecting the impact of income taxes.

We use it to assess how income tax expense affects amounts available to be distributed to our Class A common stock holders and Common Unit holders.

After-tax DE differs from U.S.

GAAP net income computed in accordance with U.S.

GAAP in that it does not include the items described in the definition of DE herein;

however, unlike DE, it does reflect the impact of income taxes.

Income taxes, for purposes of determining After-tax DE, represent the total U.S.

GAAP income tax expense adjusted to include only the current tax expense (benefit) calculated on U.S.

GAAP net income before income tax and includes the current payable under our Tax Receivable Agreement, which is recorded within other liabilities in our Consolidated Statement of Financial Condition.

Further, the current tax expense (benefit) utilized when determining After-tax DE reflects the benefit of deductions available to the Company on certain expense items that are excluded from the underlying calculation of DE, such as equity-based compensation charges.

We believe that including the amount currently payable under the Tax Receivable Agreement and utilizing the current income tax expense (benefit), as described above, when determining After-tax DE is meaningful as it increases comparability between periods and more accurately reflects earnings that are available for distribution to shareholders.

We believe that while the inclusion or exclusion of the aforementioned U.S.

GAAP income statement items provides investors with a meaningful indication of our core operating performance, the use of After-tax DE without consideration of the related U.S.

GAAP measures is not adequate due to the adjustments described herein.

This measure supplements U.S.

GAAP net income and should be considered in addition to and not in lieu of the results of operations presented in accordance with U.S.

GAAP discussed further under “—Key Components of our Results of Operations-Results of Operations.”

Fee-Related Earnings .

FRE is a supplemental performance measure and is used to evaluate our business and make resource deployment and other operational decisions.

FRE differs from net income computed in accordance with GAAP in that it adjusts for the items included in the calculation of DE and also adjusts to exclude (i) realized performance allocations and related compensation expense, (ii) realized investment income from investments and financial instruments, (iii) net interest (interest expense less interest income), (iv) depreciation, (v) amortization and (vi) certain non-core income and expenses.

Fee-Related Earnings (“FRE”) is a supplemental performance measure and is used to evaluate our business and make resource deployment and other operational decisions.

FRE differs from net income computed in accordance with U.S.

GAAP in that it adjusts for the items included in the calculation of DE and also adjusts to exclude (i) realized performance allocations and related compensation expense, (ii) realized investment income from investments and financial instruments, (iii) net interest (interest expense less interest income), (iv) depreciation, (v) amortization and (vi) certain non-core income and expenses.

We use FRE to measure the ability of our business to cover compensation and operating expenses from fee revenues other than capital allocation-based income.

The use of FRE without consideration of the related GAAP measures is not adequate due to the adjustments described herein.

The use of FRE without consideration of the related U.S.

GAAP measures is not adequate due to the adjustments described herein.

Fee-Related Revenues .

1 unchanged sentence

Fee-related revenues is comprised of (i) management fees, (ii) transaction, monitoring and other fees, net, and (iii) other income.

Fee-related revenue differs from revenue computed in accordance with GAAP in that it excludes certain reimbursement expense arrangements.

Refer to “—Reconciliation to GAAP Measures” to the comparable line items on the combined statements of operations.

Fee-related revenue differs from revenue computed in accordance with U.S.

GAAP in that it excludes certain reimbursement expense arrangements.

Refer to “—Reconciliation to U.S.

GAAP Measures” to the comparable line items on the combined statements of operations.

Fee-Related Expenses .

Fee-related expenses is a component of FRE.

Fee-related expenses differs from expenses computed in accordance with GAAP in that it is net of certain reimbursement arrangements.

Fee-related expenses differs from expenses computed in accordance with U.S.

GAAP in that it is net of certain reimbursement arrangements.

Fee-related expenses is used in management’s review of the business.

Refer to “—Reconciliation to GAAP Measures” to the comparable line items on the combined statements of operations.

Refer to “—Reconciliation to U.S.

GAAP Measures” to the comparable line items on the combined statements of operations.

Fee-related revenues and fee-related expenses are presented separately in our calculation of non-GAAP measures in order to better illustrate the profitability of our FRE.

The use of fee-related revenues and FRE without consideration of the related GAAP measures is not adequate due to the adjustments described herein.

The use of fee-related revenues and FRE without consideration of the related U.S.

GAAP measures is not adequate due to the adjustments described herein.

Our calculations of DE, FRE, fee-related revenue and fee-related expenses may differ from the calculations of other investment managers.

19 unchanged sentences

After-Tax Distributable Earnings $ 700,263 $ 1,239,863 $ 441,467

Within our GAAP Results of Operations, our former affiliate is presented as an equity method investment beginning May 1, 2020 and was consolidated prior to such date.

For comparability purposes across all periods presented, the historical non-GAAP financial measures presented in the table above reflect our former affiliate business as being deconsolidated and its net earnings are included within Other Income.

Please refer to “—Reconciliation of GAAP Measures.”

Year Ended December 31, 2022 Compared to Year Ended December 31, 2021

Fee-Related Revenues

Fee-related revenues increased by $151.0 million for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase was primarily due to higher management fees of $94.7 million and transaction, monitoring and other fees, net of $52.6 million, and other income of $3.8 million.

Fee-related revenues increased by $218.9 million, or 25% for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The increase was primarily due to additional management fees of $211.5 million and transaction, monitoring and other fees, net of $7.0 million.

Management Fees

3 unchanged sentences

Capital $ 382,992 $ 335,376

Growth 142,388 110,551

Impact 179,742 106,096

Real Estate 153,908 70,442

Growth 141,735 142,388

Market Solutions 71,483 64,062

Total Management Fees $ 929,860 $ 718,364

The increase in management fees of $94.7 million for the year ended December 31, 2021 compared to the year ended December 31, 2020 was largely due to additional management fees of $42.3 million earned from the Impact platform, primarily as a result of the launch of Rise Climate during the third quarter of 2021.

Management fees generated from the Growth platform increased $31.8 million, primarily driven by Growth V, TTAD I, and TDM which generated $49.7 million, $5.2 million, and $3.0 million, respectively, in additional management fees, partially offset by lower fees generated from Growth IV of $21.9 million.

Market Solutions also contributed $20.3 million to the overall management fee increase primarily due to the acquisition of the NewQuest funds during the year.

Both funds had their initial close in 2020.

Management fees increased by $211.5 million, or 29%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was largely due to fee earning capital raised resulting in additional management fees of $83.5 million earned from the Real Estate platform, primarily as a result of the activation of TREP IV during the first quarter of 2022.

Management fees generated from the Impact platform increased $73.6 million, due to the activation of Rise Climate in the third quarter of 2021, and Rise III in the second quarter of 2022.

The Capital platform had an increase of $47.6 million in management fees, largely from the activation of both TPG IX and Asia VIII in the third quarter of 2022, partially offset by a decrease of $30.0 million in TPG VII.

The Market Solutions platform also contributed $7.4 million to the overall management fee increase primarily due to the acquisition of NewQuest in July 2021.

Certain management fees earned during the year ended December 31, 2022 were considered catch-up fees as a result of additional capital commitments from limited partners to Rise Climate and TTAD II in the amount of $2.8 million.

Transaction, Monitoring and Other Fees, Net

3 unchanged sentences

Market Solutions $ 91,426 $ 91,737

Capital 5,545 9,058

Impact 6,730 4,264

Growth 495 560

Real Estate 5,181 —

Capital 5,094 5,545

Growth 647 495

Total Transaction, Monitoring and Other Fees, Net $ 109,078 $ 102,041

The increase in transaction, monitoring and other fees, net of $52.6 million for the year ended December 31, 2021 as compared to the year ended December 31, 2020 was primarily attributable to the Market Solutions platform as a result of higher levels of participation by our broker-dealer in the debt and equity capital markets activities of our portfolio companies.

The increase was partially offset by decreased transaction fees earned from portfolio companies in TPG VII of the Capital platform.

Transaction, monitoring and other fees, net increased by $7.0 million, or 7%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This increase was primarily attributable to the Real Estate platform driven by TRTX incentive fees.

The following table presents other income for the years ended December 31, 2022 and 2021:

2 unchanged sentences

Former affiliate funds $ 27,915 $ 38,942

Other investments 5,161 7,186

Other income 19,154 2,570

Other investments — 5,161

Total Other Income (1)

$ 47,069 $ 46,673

(1) Includes other income of $13.5 million and $5.8 million during the years ended December 31, 2021 and 2020, respectively, generated by certain other investments that were transferred to RemainCo as Excluded Assets on December 31, 2021.

The increase in other income of $3.8 million for the year ended December 31, 2021 as compared to the year ended December 31, 2020 was primarily driven by appreciation from our investment in our former affiliate resulting in $4.8 million of additional income.

(1) Includes other income of $13.5 million during the year ended December 31, 2021, generated by certain other investments that were transferred to RemainCo as Excluded Assets on December 31, 2021.

Accordingly, there was no impact for the year ended December 31, 2022.

Total other income increased by $0.4 million, or 1%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change primarily resulted from an increase in income earned from RemainCo under the RemainCo administrative agreement, offset by the transfer of certain of our strategic investments to RemainCo on December 31, 2021.

Fee-Related Expenses

Fee-related expenses increased by $73.9 million for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase was primarily comprised of additional compensation and benefits, net of $80.2 million, partially offset by decreased operating expenses, net of $6.2 million.

Fee-related expenses decreased by $56.4 million, or 8%, for the year ended December 31, 2022 compared to the year ended December 31, 2021, comprised primarily of lower compensation and benefits, net of $128.4 million partially offset by increased operating expenses, net of $72.1 million.

Compensation and Benefits, Net

2 unchanged sentences

($ in thousands)

Salaries and benefits $ 169,552 $ 158,967

Salaries $ 197,587 $ 169,552

196,083 342,276

2 unchanged sentences

Total Compensation and Benefits, Net $ 392,968 $ 521,413

(1) Includes bonus compensation of $138.6 million and $113.7 million during the year ended December 31, 2021 and 2020, respectively, for TPG senior professionals that we anticipate being paid as performance allocation rather than discretionary bonus beginning in 2022.

The increase in compensation and benefits, net of $80.2 million for the year ended December 31, 2021 compared to the year ended December 31, 2020 was primarily due to increased bonuses of $64.2 million, benefits and other of $10.1 million, and salaries and benefits of $10.6 million as a result of additional headcount and merit increases driven by growth in fee-related revenues and the consolidation of NewQuest.

The increase was partially offset by additional compensation reimbursements related to services provided to certain funds and portfolio companies.

(1) Includes bonus compensation of $140.3 million during the year ended December 31, 2021 for TPG senior professionals.

Total compensation and benefits, net decreased by $128.4 million, or 25%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

This change was primarily due to a decrease in bonuses of $146.2 million as a result of certain TPG senior professionals no longer receiving discretionary bonuses, and increased compensation reimbursements related to services provided to certain fund and portfolio companies.

The decrease was partially offset by increased salaries of $28.0 million driven by firm headcount expansion.

Operating Expenses, Net

Operating expenses, net includes general and administrative expenses as well as reimbursements for professional services and travel expenses related to investment management and advisory services provided to TPG funds and monitoring services provided to our portfolio companies in the amounts of $18.7 million and $14.8 million for the years ended December 31, 2021 and 2020, respectively.

The decrease in operating expenses, net of $6.2 million for the year ended December 31, 2021 compared to the year ended December 31, 2020 was primarily due to a decrease in office expenses of $3.1 million, travel expenses of $2.3 million, and additional reimbursements related to services provided to certain funds and portfolio companies of $3.9 million, partially offset by a higher level of professional fees and other administrative costs of $6.5 million.

Operating expenses, net were $239.2 million and $167.1 million for the year ended December 31, 2022 and 2021, respectively, with the increase of $72.1 million primarily due to an increase in professional fees of $26.1 million, travel expenses of $19.8 million, and other administrative expenses of $26.3 million.

Realized Performance Allocations, Net

Realized performance allocations, net include gross realized performance allocations of $1,957.5 million and $607.2 million, net of realized performance allocations to TPG affiliated partners of $957.9 million and $293.7 million during the year ended December 31, 2021 and 2020, respectively.

The following table presents realized performance allocations, net from our platforms for the years ended December 31, 2021 and 2020:

Realized performance allocations, net were $282.4 million during the year ended December 31, 2022 and $999.6 million during the year ended December 31, 2021, with the following platform breakout:

Year Ended December 31,

1 unchanged sentence

Capital $ 250,382 $ 725,171

Impact 15,961 568

Growth 13,681 234,025

3 unchanged sentences

$ 282,383 $ 999,603

(1) Includes realized performance allocations, net of $794.9 million and $272.7 million during the years ended December 31, 2021 and 2020, respectively, attributable to the TPG Operating Group Excluded entities.

As previously described herein, these entities’ performance allocations will not be a component of distributable earnings beginning in 2022.

Realized performance allocations, net $999.6 million for the year ended December 31, 2021 were largely generated from realizations in TPG VII of $501.6 million, TPG VI of $173.5 million and Asia VI of $28.4 million in the Capital platform.

(1) Includes realized performance allocation, net of $794.9 million during the year ended December 31, 2021 attributable to the TPG Operating Group Excluded entities.

As previously described herein, these entities’ performance allocations are not a component of distributable earnings beginning in the fiscal year ending December 31, 2022.

Realized performance allocations, net of $282.4 million for the year ended December 31, 2022 were largely generated from realizations of $191.8 million from TPG VII, $25.9 million from TPG VIII and $19.4 million from Asia VII within the Capital platform.

Realizations within the Impact platform of $16.0 million were generated from Rise I.

This activity consisted of realizations sourced from portfolio companies including McAfee, Wind River, Kelsey-Seybold Clinics, Greencross, and DirecTV.

Realized performance allocations, net of $999.6 million for the year ended December 31, 2021 were largely generated from realizations in TPG VII of $501.6 million, TPG VI of $173.5 million and Asia VI of $28.4 million in the Capital platform.

Realizations from the Growth platform were generated from Growth III of $131.2 million, Growth II of $35.8 million, Biotech III of $27.8 million, TSI of $24.0 million and TTAD I of $11.2 million.

1 unchanged sentence

The activity consisted of realizations sourced from portfolio companies including Astound, Kindred at Home, Transplace Holdings, Creative Artists Agency, DirecTV and Medical Solutions.

Realized performance allocations, net of $313.5 million for the year ended December 31, 2020 were largely generated from realizations in TPG VI of $53.2 million and TPG VII of $105.2 million in the Capital platform.

Realizations from the Growth platform were generated from Growth II of $58.8 million, and TPG Pace within the Market Solutions platform.

The realized performance allocation mainly consisted of amounts from portfolio companies including WellSky, LLamasoft, IQVIA Holdings, Inc.

IQV), Uber (NYSE:

UBER) and Adare Pharmaceuticals.

Realized Investment Income and Other, Net

7 unchanged sentences

$ 42,038 $ 92,720

(1) Includes realized investment income and other, net of $26.0 million and $32.7 million during the years ended December 31, 2021 and 2020, respectively, generated by certain other investments that were transferred to RemainCo as of December 31, 2021.

The increase in realized investment income and other, net of $35.5 million for the year ended December 31, 2021 compared to the year ended December 31, 2020 was primarily due to realizations from our investments in the TPG Funds for $78.3 million driven by the Capital platform by $53.5 million, Growth platform by $10.6 million and Market Solutions platform by $3.4 million.

The increase was partially offset by a reduction in other investments of $8.0 million and increased non-core transaction expenses of $28.3 million primarily related to the Reorganization described in the Organization section herein.

Depreciation expense increased $0.2 million between the years ended December 31, 2021 and 2020, respectively.

There were no significant purchases or disposals that occurred during the period.

(1) Includes realized investment income and other, net of $26.0 million during the year ended December 31, 2021 generated by certain other investments that were transferred to RemainCo as of December 31, 2021.

Realized investment income and other, net decreased by $50.7 million, or 55%, resulting from lower realizations of $29.0 million from our investments in TPG funds and the transfer of certain of our strategic investments to RemainCo on December 31, 2021.

Depreciation expense decreased $2.2 million, or 32%, for the year ended December 31, 2022 compared to the year ended December 31, 2021.

Interest Expense, Net

5 unchanged sentences

Interest Expense, Net $ 13,795 $ 14,928

The increase in interest expense, net during the year ended December 31, 2021 compared to the year ended December 31, 2020 was primarily due to decreased interest income from cash balances, partially offset by decreased interest expense due to the payoff of an outstanding credit facility balance in 2021.

The decrease in interest expense, net during the year ended December 31, 2022 compared to the year ended December 31, 2021 was primarily due to higher interest income from interest earned on cash and cash equivalents, partially offset by higher interest rates on certain borrowings.

Distributable Earnings

The increase in DE for the year ended December 31, 2021 compared to the year ended December 31, 2020 was primarily due to higher FRE, realized performance allocations, net, and realized investment income and other, net, partially offset by an increase in interest expense, net.

Income taxes were consistent for the years ended December 31, 2021 and December 31, 2020 driven by stable income generated by our consolidated foreign subsidiaries.

The decrease in DE for the year ended December 31, 2022 compared to the year ended December 31, 2021 was primarily due to lower realized performance allocations, net, partially offset by a 154% increase in our Fee-Related Earnings.

Income taxes increased $50.3 million for the year ended December 31, 2022 compared to the year ended December 31, 2021.

The increase in income taxes is a result of the Company being subject to federal income taxes subsequent to the Reorganization and IPO.

Year Ended December 31, 2021 Compared to Year Ended December 31, 2020

Fee-Related Revenues

Fee-related revenues increased by $151.0 million for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase was primarily due to higher management fees of $35.0 million and transaction, monitoring and other fees, net of $1.2 million, partially offset by a decrease in other income of $11.5 million.

The increase was primarily due to higher management fees of $94.7 million and transaction, monitoring and other fees, net of $52.6 million.

Management Fees

4 unchanged sentences

Growth 142,388 110,551

Real Estate 70,449 72,729

Impact 106,096 63,755

Real Estate 70,442 70,449

Market Solutions 64,062 43,780

Total Management Fees $ 718,364 $ 623,658

The increase in management fees of $35.0 million for the year ended December 31, 2020 compared to the year ended December 31, 2019 was primarily driven from TPG VIII and THP totaling an additional $12.0 million, Growth II Gator of $7.6 million arising from the full-year effect of the fund during the year ended December 31, 2020, $4.1 million in TTAD I, fees earned from TPEP of $12.2 million and $32.7 million from closing of Rise II and Evercare during the year ended December 31, 2019.

This was offset by lower management fees of $0.6 million related to the step down from TREP II following the closing of TREP III in 2018 as well as $12.1 million from Rise I, $4.6 million from Asia VII, $7.4 million from Growth II and $6.7 million from Growth IV.

$6.9 million of management fees in the year ended December 31, 2019 were considered catch-up fees from additional capital commitments from limited partners to Asia VII, which had its first close in 2017.

The increase in management fees of $94.7 million for the year ended December 31, 2021 compared to the year ended December 31, 2020 was largely due to additional management fees of $42.3 million earned from the Impact platform, primarily as a result of the activation of Rise Climate during the third quarter of 2021.

Management fees generated from the Growth platform increased $31.8 million, driven by Growth V, TTAD I and TDM which generated $49.7 million, $5.2 million and $3.0 million, respectively.

This was partially offset by lower fees generated from Growth IV of $21.9 million.

Market Solutions also contributed $20.3 million to the overall management fee increase due to the acquisition of the NewQuest funds during 2021.

Both funds were activated in 2020.

Transaction, Monitoring and Other Fees, Net

8 unchanged sentences

Total Transaction, Monitoring, and Other Fees, Net $ 102,041 $ 49,455

The increase in transaction, monitoring and other fees, net of $1.2 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019 was attributable to the Market Solutions platform as a result of higher levels of participation by our broker-dealer in the debt and equity capital markets activities of our portfolio companies during the year ended December 31, 2020 compared to the year ended December 31, 2019.

This increase was offset by decreased monitoring fees earned from portfolio companies of the Capital platform and incentive fees earned from the Real Estate platform.

The increase was partially offset by decreased transaction fees earned from portfolio companies in TPG VII of the Capital platform.

The following table presents other income for the years ended December 31, 2021 and 2020:

6 unchanged sentences

$ 46,673 $ 42,920

(1) Includes other income of $5.8 million, $21.0 million and $17.8 million during the years ended December 31, 2020 and 2019, respectively, generated by certain other investments were transferred to RemainCo as of December 31, 2021.

The decrease in other income of $11.5 million for the year ended December 31, 2020 as compared to the year ended December 31, 2019 was primarily driven by reduced economics from our investment in our former affiliate, partially offset by reimbursements for operational services provided to our former affiliate and an increase in income from our other investments.

Fee-Related Expenses

Fee-related expenses decreased by $7.5 million for the year ended December 31, 2020 compared to the year ended December 31, 2019.

The decrease was primarily comprised of reduced operating expenses, net of $20.3 million, partially offset by increased compensation and benefits, net of $12.8 million.

Fee-related expenses increased by $73.9 million for the year ended December 31, 2021 compared to the year ended December 31, 2020.

The increase was primarily comprised of additional compensation and benefits, net of $80.2 million, partially offset by decreased operating expenses, net of $6.2 million.

Compensation and Benefits, Net

2 unchanged sentences

($ in thousands)

Salaries and benefits $ 158,967 $ 152,513

Salaries $ 169,552 $ 158,967

342,276 278,059

2 unchanged sentences

Total Compensation and Benefits, Net $ 521,413 $ 441,245

(1) Includes bonus compensation of $113.7 million and $113.2 million during the years ended December 31, 2020 and 2019, respectively, for TPG senior professionals that we anticipate being paid as performance allocation rather than discretionary bonus beginning in 2022.

The increase in compensation and benefits, net of $12.8 million for the year ended December 31, 2020 compared to the year ended December 31, 2019 was primarily due to an increase in salaries from growth in headcount and merit.

Bonuses increased as a result of merit and growth in fee-related revenues, partially offset by increased compensation reimbursements related to services provided to certain funds and portfolio companies.

(1) Includes bonus compensation of $138.6 million and $113.7 million during the year ended December 31, 2021 and 2020, respectively, for TPG senior professionals.

The increase in compensation and benefits, net of $80.2 million for the year ended December 31, 2021 compared to the year ended December 31, 2020 was primarily due to increased bonuses of $64.2 million, benefits and other of $10.1 million, and salaries of $10.6 million as a result of additional headcount and merit increases driven by growth in fee-related revenues and the consolidation of NewQuest.

The increase was partially offset by additional compensation reimbursements related to services provided to certain funds and portfolio companies.

Operating Expenses, Net

Operating expenses, net includes general and administrative expenses as well as reimbursements for professional services and travel expenses related to investment management and advisory services provided to TPG funds and monitoring services provided to our portfolio companies in the amounts of $14.8 million, and $14.3 million during the years ended December 31, 2020 and 2019, respectively.

The decrease in operating expenses, net of $20.3 million for the year ended December 31, 2020 compared to the year ended December 31, 2019 was primarily due to the amount of certain reimbursable expenses.

Additionally, there was a decrease in travel and overhead related expenses as a result of the COVID-19 pandemic.

These decreases were partially offset by a higher level of professional fees and other administrative costs in connection with the growth of the business.

Realized Performance Allocations, Net

Realized performance allocations, net include gross realized performance allocations of $607.2 million and $578.8 million and net of realized performance allocations to TPG affiliated partners of $293.7 million and $292.9 million for the years ended December 31, 2020 and 2019, respectively.

The following table presents realized performance allocations, net from our platforms for the years ended December 31, 2021 and 2020:

9 unchanged sentences

As previously described herein, these entities’ performance allocations will not be a component of distributable earnings beginning in 2022.

Realized performance allocations, net of $313.5 million for the year ended December 31, 2020 were largely generated from realizations in the Capital platform, including TPG VI for $53.2 million and TPG VII for $105.2 million, the Growth platform, including Growth II for $58.8 million, and TPG Pace within the Market Solutions platform.

Realizations from the Growth platform were generated from Growth III of $131.2 million, Growth II of $35.8 million, Biotech III of $27.8 million, TSI of $24.0 million and TTAD I of $11.2 million.

Realizations from the Real Estate platform were generated from Real Estate II of $24.5 million.

The activity consisted of realizations sourced from portfolio companies including Astound, Kindred at Home, Transplace Holdings, Creative Artists Agency, DirecTV and Medical Solutions.

Realizations from the Growth platform were generated from Growth II of $58.8 million, and TPG Pace within the Market Solutions platform.

The realized performance allocation mainly consisted of amounts from portfolio companies including WellSky, LLamasoft, IQVIA Holdings, Inc.

1 unchanged sentence

UBER) and Adare Pharmaceuticals.

Realized performance allocations, net of $286.0 million for the year ended December 31, 2019 were largely generated from realizations in the Capital platform, including TPG VI for $20.4 million and Asia V for $53.5 million, the Growth platform, including Growth II for $82.9 million and TPG Pace within the Market Solutions platform.

The realized performance allocation mainly consisted of amounts from portfolio companies including IQVIA Holdings, Inc.

IQV), Lenta (LSE:

LNTA), Transporeon, Nexeo Solutions (NASDAQ:

NXEO) and McAfee Corp (NASDAQ:

Realized Investment Income and Other, Net

2 unchanged sentences

($ in thousands)

Other investments $ 32,276 $ 45,320

Investments in TPG funds $ 111,151 $ 32,215

Other investments 23,647 32,276

Non-core income (expense) (42,078) (7,260)

2 unchanged sentences

The increase in realized investment income and other, net of $3.0 million for the year ended December 31, 2020 compared to the year ended December 31, 2019 was primarily due to the reduced transaction expenses in non-core income (expense) of $10.4 million as well as realizations from our investments in the Capital platform.

The increases were offset by a decrease in other investments related to the disaffiliation of our former affiliate.

Depreciation expense was consistent between the years ended December 31, 2020 and 2019, respectively.

There were no significant purchases or disposals that occurred during the year.

Of that amount, $53.5 million was attributable to the Capital platform, $10.6 million to the Growth platform, and $3.4 million to the Market Solutions Platform.

Depreciation expense increased $0.2 million between the years ended December 31, 2021 and 2020, respectively.

There were no significant purchases or disposals that occurred during the period.

Interest Expense, Net

5 unchanged sentences

Interest Expense, Net $ 14,928 $ 14,843

The increase in interest expense, net during the year ended December 31, 2020 compared to the year ended December 31, 2019 was primarily due to an increase in interest expense as a result of incremental debt outstanding following borrowings under the Revolving Credit Facility to Affiliate in March 2020 and the issuance of the Series B Securitization Notes in October 2019 as well as a decrease of interest income due to lower interest-earning cash balances and generally lower returns earned on cash balances.

Distributable Earnings

The increase in DE for the year ended December 31, 2020 compared to the year ended December 31, 2019 was primarily due to higher FRE, realized performance allocations, net, and realized investment income and other, net, partially offset by an increase in interest expense, net.

The increase in income taxes for the year ended December 31, 2020 compared to the year ended December 31, 2019 was primarily due to higher income generated by our consolidated foreign subsidiaries.

Reconciliation to GAAP Measures

The following tables reconcile the most directly comparable financial measures calculated and presented in accordance with GAAP to non-GAAP financial measures for the years ended December 31, 2021, 2020 and 2019:

The increase in DE for the year ended December 31, 2021 compared to the year ended December 31, 2020 was due to higher FRE, realized performance allocations, net, and realized investment income and other, net.

Income taxes were consistent for the years ended December 31, 2021 and December 31, 2020 driven by stable income generated by our consolidated foreign subsidiaries.

Reconciliation to U.S.

GAAP Measures

The following tables reconcile the most directly comparable financial measures calculated and presented in accordance with U.S.

GAAP to non-GAAP financial measures for the years ended December 31, 2022, 2021 and 2020:

Year Ended December 31,

2 unchanged sentences

GAAP Revenue $ 2,002,887 $ 4,976,387 $ 2,114,838

Capital-allocation income (3,998,483) (1,231,472) (955,977)

Capital-allocation based income (756,252) (3,998,483) (1,231,472)

Deconsolidation of former affiliate — — (87,235)

11 unchanged sentences

Expense reimbursements (166,090) (132,810) (110,457)

Performance allocation compensation (416,556) — —

Equity-based compensation (627,714) — —

Non-core expenses and other (44,364) (36,951) 37,901

9 unchanged sentences

Amortization expense 14,153 14,195 —

Equity-based compensation 634,759 —

Unrealized performance allocations, net 117,924 (856,505) (267,432)

1 unchanged sentence

Unrealized (gain) loss on derivatives (1,119) (20,626) 21,056

Income taxes (26,454) — —

Non-recurring items (5,620) (2,220) 10,833

8 unchanged sentences

Balance sheet

($ in thousands) As of December 31, 2021

The following tables reconcile the most directly comparable financial measures calculated and presented in accordance with U.S.

GAAP to non-GAAP financial measures as of December 31, 2022 and December 31, 2021:

As of December 31,

($ in thousands) 2022 2021

Total GAAP Assets $ 7,941,738 $ 8,962,013

9 unchanged sentences

Investments (4,110,535) (4,204,888)

Right-of-use assets (157,467)

Other assets, net (459,736)

Other assets (134,505) (282,272)

Subtotal for other consolidated entities (4,871,934) (5,135,962)

As of December 31, 2021

Reclassification adjustments (1)

1 unchanged sentence

Investments (1,219,333) (1,904,158)

Accrued performance fees 1,344,347

Other investments 894,741

Accrued performance allocations 642,519 1,344,348

Investments in funds 576,814 559,810

Other assets 81,354 105,092

1 unchanged sentence

Total Book Assets $ 2,500,427 $ 2,892,748

As of December 31,

($ in thousands) 2022 2021

Total GAAP Liabilities $ 4,202,232 $ 1,700,572

7 unchanged sentences

Due to affiliates (134,562) (820,998)

Operating lease liability (177,003)

Accrued performance allocation compensation (3,269,889) —

Other liabilities (206,276) (238,055)

8 unchanged sentences

Impact of consolidated TPG Funds and Public SPACs (2)

(653,635) (1,000,027)

Total Book redeemable equity from consolidated Public SPACs $ — $ —

3 unchanged sentences

Reclassification adjustments (1)

74,230 (425,299)

Net Book Value $ 2,007,678 $ 1,923,037

1 unchanged sentence

We separately analyze our investments on a non-GAAP basis between accrued performance fees and other investments, which consists of co-investments into our funds and other equity method investments.

Additionally, we reclassified GAAP financial statement amounts due from affiliates and certain amounts within other assets, net for Non-GAAP purposes and reclassified GAAP financial statement amounts due to affiliates and other liabilities within accounts payable, accrued expenses and other for Non-GAAP purposes.

(2) The $1,000.0 million redeemable equity represents ownership interest in each SPAC that is not owned by the TPG Operating Group and is presented separately form GAAP Partners’ Capital in the accompanying Consolidated Financial Statements.

Additionally, we reclassified U.S.

GAAP financial statement amounts due from affiliates and certain amounts within other assets, net for non-GAAP purposes and reclassified U.S.

GAAP financial statement amounts due to affiliates and other liabilities within accounts payable, accrued expenses and other for non-GAAP purposes.

(2) The $653.6 million and $1,000.0 million redeemable equity, respectively, represent ownership interest in each SPAC that is not owned by the TPG Operating Group and is presented separately from U.S.

GAAP partners’ capital in the accompanying Consolidated Financial Statements.

Operating Metrics

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AUM represents the sum of (i) fair value of the investments and financial instruments held by our TPG funds managed by us, plus the capital that we are entitled to call from investors in those funds and co-investors, pursuant to the terms of their respective capital commitments, net of outstanding leverage, including capital commitments to funds that have yet to commence their investment periods;

(ii) the net asset value of our hedge funds and funds of hedge funds;

(iii) the gross amount of assets (including leverage) for our mortgage REITs;

(ii) the net asset value of our hedge funds;

(iii) the gross amount of assets (including leverage) for our mortgage REIT and collateralized fundraising vehicles;

and (iv) IPO proceeds held in trust, excluding interest, as well as forward purchase agreements and proceeds associated with the private investment in public equity related to our SPACs upon the consummation of a business combination.

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The following table summarizes our AUM by platform as of December 31, 2022, 2021 and 2020:

Year Ended December 31,

As of December 31,

2022 2021 2020

2 unchanged sentences

Growth 23,138 21,960 16,388

Impact 13,549 5,941 5,150

Real Estate 19,503 12,678 10,380

Impact 16,429 13,549 5,941

Market Solutions 9,572 10,094 7,056

1 unchanged sentence

AUM increased from approximately $113.6 billion as of December 31, 2021 to approximately $135.0 billion as of December 31, 2022.

During the year ended December 31, 2022, new capital of $30.0 billion was raised primarily attributable to TPG IX, Asia VIII and THP II within the Capital platform, TREP IV within the Real Estate platform and Rise III within the Impact platform.

Realizations totaled $15.5 billion and were primarily attributable to TPG VII, TPG VIII and Asia VII within the Capital platform, Growth IV within the Growth platform, TRTX and TREP III within the Real Estate platform and Rise I within the Impact platform.

AUM also increased due to portfolio appreciation of 8% recognized during the year ended December 31, 2022.

AUM increased from approximately $89.5 billion as of December 31, 2020 to approximately $113.6 billion as of December 31, 2021.

During the year ended December 31, 2021, new capital of $20.5 billion was raised primarily attributable to Rise Climate within the Impact platform, TTAD II and Growth V within the Growth platform, TAC+ within the Real Estate platform and AAF within the Capital platform.

Realizations totaled $25.4 billion and were primarily attributable to the Capital platform, including TPG VI, TPG VII and TPG VIII and Growth III within the Growth platform.

These were offset by portfolio realized and unrealized appreciation of 38% recognized for the year ended December 31, 2021.

AUM increased from approximately $85.0 billion as of December 31, 2019 to approximately $89.5 billion as of December 31, 2020.

During the year ended December 31, 2020, new capital raised was $7.0 billion in the Growth platform

for Growth V and the Market Solutions platform for TSCF, TPEP and TPG Pace and changes in investment value of $8.2 billion primarily attributable to TPG VII within the Capital platform and Growth III within the Growth platform.

This was partially offset by realizations of $10.7 billion primarily driven by the Capital platform, including TPG VI and TPG VII, and the Growth platform, primarily Growth II and Growth III.

These were offset by portfolio appreciation of 38% recognized during the year ended December 31, 2021.

Fee Earning Assets Under Management

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It also includes reductions for funds that are no longer fee paying.

FAUM increased from $50.7 billion from December 31, 2020 to $60.1 billion as of December 31, 2021.

The increase was primarily related to fee earning capital raised activity totaling $10.4 billion related to the Impact and Growth platforms.

For the year ended December 31, 2021, annualized weighted average management fees as a percentage of FAUM, which represent annualized management fees divided by the average of each applicable period’s FAUM, were 1.30%.

FAUM was relatively unchanged between December 31, 2019 and 2020, and increased by $13.5 billion between December 31, 2018 and 2019.

The increase in FAUM during 2019 primarily relates to the activation of TPG VIII and THP within the Capital platform.

For the year ended December 31, 2020, annualized weighted average management fees were 1.23%.

The following table summarizes our FAUM by platform as of December 31, 2022, 2021 and 2020:

3 unchanged sentences

Capital $ 35,371 $ 26,208 $ 27,381

Real Estate 13,324 6,235 5,904

Impact 12,739 10,801 4,439

1 unchanged sentence

Market Solutions 5,681 6,336 4,534

Real Estate 6,235 5,904 6,203

FAUM as of end of period $ 77,945 $ 60,094 $ 50,655

FAUM increased from approximately $50.7 billion as of December 31, 2020 to approximately $60.1 billion as of December 31, 2021.

The increase was primarily attributable to the closings of Rise Climate within the Impact platform in 2021, the final closing of Growth V within the Growth platform during the third quarter of 2021, and the acquisition of NewQuest offset by net change in actively invested capital of TPG VII within the Capital platform.

FAUM remained relatively constant as of December 31, 2019 and 2020.

The slight increase was primarily driven by the additional capital raises for Rise II, Growth V and TPEP.

This was partially offset by a reduction in actively invested capital associated with TPG VII within the Capital platform.

FAUM increased from $60.1 billion as of December 31, 2021 to $77.9 billion as of December 31, 2022.

The increase was related to fee earning capital raised activity totaling $23.8 billion primarily attributable to the activation of TPG IX, Asia VIII and THP II within the Capital platform, which were activated during the third quarter of 2022.

The increase was also attributable to the activation of TREP IV in the Real Estate platform, which was activated during the first quarter of 2022 and the activation of Rise III in the Impact platform, which was activated during the second quarter of 2022.

These increases were partially offset by a decrease in actively invested capital of TPG VII within the Capital platform and reduction in fee base of TPG VIII and Asia VII within the Capital platform.

For the year ended December 31, 2022, annualized weighted average management fees as a percentage of FAUM, which represent annualized management fees divided by the average of each applicable period’s FAUM, were 1.35%.

FAUM increased from $50.7 billion as of December 31, 2020 to $60.1 billion as of December 31, 2021.

The increase was primarily attributable to the activation of Rise Climate, within the Impact platform during the third quarter of 2021, the activation of Growth V, within the Growth platform during the third quarter of 2020, and the acquisition of NewQuest offset by net change in actively invested capital of TPG VII within the Capital platform.

Net Accrued Performance Allocations

Net accrued performance allocations represents both unrealized and undistributed performance allocations resulting from our general partner interests in our TPG funds.

We believe this measure is useful to investors as it provides additional insight into the accrued performance allocations to which the TPG Operating Group Common Unit holders are expected to receive.

This measure has been adjusted for Reorganization transfers as of December 31, 2021.

Refer to the “Unaudited Pro Forma Non-GAAP Balance Sheet Financial Measures” for additional details.

The table below summarizes our net accrued performance allocations by fund vintage year and platform as of December 31, 2022 and 2021:

7 unchanged sentences

Growth 162 289

Market Solutions 74 22

Real Estate 30 38

Market Solutions 27 74

Net Accrued Performance Allocations $ 643 $ 1,346

Key TPG funds that drove the net accrued performance allocations included TPG VII, TPG VIII, Asia VI, Asia VII and Growth III as of December 31, 2021 and TPG VI, TPG VII, Asia VI and Growth III as of December 31, 2020.

Net accrued performance allocations were primarily comprised of TPG VII, TPG VIII, Asia VII and Growth IV as of December 31, 2022 and TPG VII, TPG VIII, Asia VI, Asia VII and Growth III as of December 31, 2021.

We also utilize Performance Allocation Generating AUM and Performance Allocation Eligible AUM as key metrics to understand AUM that could produce performance allocations.

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AUM Subject to Fee Earning Growth represents capital commitments that when deployed have the ability to grow our fees through earning new management fees (AUM Not Yet Earning Fees) or when capital is invested and management fees can be charged at a higher rate (FAUM Subject to Step-Up).

AUM Not Yet Earning Fees represents the amount of capital commitments to TPG investment funds and co-investment vehicles that has not yet been invested or considered active, and as this capital is invested or activated, the fee-paying portion will be included in FAUM.

paying portion will be included in FAUM.

FAUM Subject to Step-Up represents capital raised within certain funds where the management fee rate increases once capital is invested.

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AUM Not Yet Earning Fees:

Capital $ 3,551 $ 1,054 $ 1,436

Growth 2,863 3,279 1,518

Real Estate 1,201 255 331

Market Solutions 1,573 1,056 1,108

Capital 1,054 1,436 1,823

Real Estate 1,172 1,201 255

Impact 939 258 300

6 unchanged sentences

Total AUM Subject to Fee Earning Growth $ 13,004 $ 9,391 $ 10,235

As of December 31, 2021, AUM Not Yet Earning Fees was $6.8 billion, which primarily consisted of TPG VII within the Capital platform, TTAD II within the Growth platform, TACP within the Real Estate platform and TSCF within the Market Solutions platform.

As of December 31, 2020, AUM Not Yet Earning Fees was $4.6 billion, which primarily consisted of TPG VII within the Capital platform and TSCF within the Market Solutions platform.

As of December 31, 2019, AUM Not Yet Earning Fees was $6.0 billion, which primarily consisted of Rise II within the Impact platform.

Rise II was activated in the year ended December 31, 2020.

As of December 31, 2022, AUM Not Yet Earning Fees was $10.1 billion, which primarily consisted of TPG VII, TPG VIII and Asia VII within the Capital platform, TTAD II and TDM within the Growth platform, TAC+ within the Real Estate platform and TSCF within the Market Solutions platform.

As of December 31, 2021, AUM Not Yet Earning Fees was $6.8 billion, which primarily consisted of TPG VII within the Capital platform, TTAD II within the Growth platform, TAC+ within the Real Estate platform and TSCF within the Market Solutions platform.

Associated with FAUM Subject to Step-Up, management fee rates on undrawn commitments for these respective underlying TPG funds range between 0.75% and 1.00% and step-up to rates in the range of 1.25% and 1.75% after capital is invested.

FAUM Subject to Step-Up as of December 31, 2021, as well as December 31, 2020 and 2019 relates to TPG VIII and THP within the Capital platform and TREP III within the Real Estate platform.

Capital Raised

FAUM Subject to Step-Up as of December 31, 2022 relates to TPG IX and THP II within the Capital platform and TREP III within the Real Estate platform.

FAUM Subject to Step-Up as of December 31, 2021 related to TPG VIII and THP I within the Capital platform and TREP III within the Real Estate platform.

Capital raised is the aggregate amount of capital commitments raised by TPG’s investment funds and co-investment vehicles during a given period, as well as IPO and forward purchase agreements associated with our Public SPACs and private investment in public equity upon the consummation of a business combination associated with one of our Public SPACs.

We believe this measure is useful to investors as it measures access to capital across TPG and our ability to grow our management fee base.

The table below presents capital raised by platform for the years ended December 31, 2021, 2020 and 2019:

The table below presents capital raised by platform for years ended December 31, 2022, 2021 and 2020:

Year Ended December 31,

1 unchanged sentence

($ in millions)

Capital $ 15,319 $ 4,174 $ 1,546

Real Estate 7,295 1,970 29

Impact 3,616 7,172 423

Growth 2,207 4,893 1,882

Capital 4,174 1,546 3,525

Market Solutions 1,587 2,247 3,136

Real Estate 1,970 29 260

Total Capital Raised $ 30,024 $ 20,456 $ 7,016

Capital raised totaled approximately $30.0 billion for the year ended December 31, 2022.

This was primarily attributable to the fundraising activities of TPG IX, Asia VIII and THP II within the Capital platform, Rise III within the Impact platform, TREP IV within the Real Estate platform and TDM within the Growth platform during the year ended December 31, 2022.

Capital raised totaled approximately $20.5 billion for the year ended December 31, 2021.

This was attributable to the first closing of Rise Climate within the Impact platform, TTAD II and Growth V within the Growth platform, AAF within the Capital platform and TAC+ within the Real Estate platform during the year ended December 31, 2021.

Capital raised activity decreased from approximately $7.8 billion for the year ended December 31, 2019 to approximately $7.0 billion for the year ended December 31, 2020.

Capital raised during 2020 was attributable to the closings TPG VIII and THP within the Capital platform, Rise II within the Impact platform and TPG Pace within the Market Solutions platform.

Capital raised during 2020 was attributable to the closings TPG VIII and THP I within the Capital platform, Rise II within the Impact platform and TPG Pace within the Market Solutions platform.

Available Capital

8 unchanged sentences

Capital $ 19,759 $ 10,696 $ 15,549

Real Estate 8,193 2,278 2,538

Impact 7,697 7,951 2,441

1 unchanged sentence

Market Solutions 3,098 2,552 2,158

Real Estate 2,278 2,538 3,285

Available Capital $ 42,958 $ 28,420 $ 25,681

Available capital increased from approximately $28.4 billion as of December 31, 2021 to approximately $43.0 billion as of December 31, 2022.

The increase was attributable to capital raised in Rise Climate within the Impact platform and TTAD II in the Growth platform and TAC + within the Real Estate platform, offset by a decrease in TPG VIII within the Capital platform.

Available capital decreased from approximately $28.1 billion as of December 31, 2019 to approximately $25.7 billion as of December 31, 2020.

The decline was primarily attributable to TPG VIII, THP and Asia VII within the Capital platform, Growth IV within the Growth platform and TREP III within the Real Estate platform as a result of new investments.

The decrease was partially offset by new capital raised in Growth V within the Growth platform and TSCF within the Market Solutions platform.

The increase was attributable to capital raised in TPG IX, Asia VIII and THP II within the Capital platform, TREP IV within the Real Estate platform, and Rise III within the Impact platform, partially offset by capital invested in TPG VIII within the Capital platform and Rise Climate within the Impact platform.

Available capital increased from approximately $25.7 billion as of December 31, 2020 to approximately $28.4 billion as of December 31, 2021.

The increase was attributable to capital raised in Rise Climate within the Impact platform and TTAD II in the Growth platform and TAC + within the Real Estate platform, partially offset by capital invested in TPG VIII within the Capital platform.

Capital Invested

Capital invested is the aggregate amount of capital invested during a given period by TPG’s investment funds, co-investment vehicles and SPACs in conjunction with the completion of a business combination.

It excludes hedge fund activity.

We believe this measure is useful to investors as it measures capital deployment across TPG.

Capital invested includes investments made using investment financing arrangements like credit facilities, as applicable.

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Capital $ 6,250 $ 10,624 $ 5,896

Real Estate 4,537 1,493 3,585

Growth 3,333 1,956 2,390

Impact 3,667 1,711 556

Growth 3,123 3,333 1,956

Real Estate 2,954 4,537 1,493

Market Solutions 559 1,434 —

Capital Invested $ 16,553 $ 21,639 $ 9,901

Capital invested was $16.6 billion for the year ended December 31, 2022 which was primarily attributable to TPG VIII within the Capital platform, Rise Climate within the Impact platform, TTAD II within the Growth platform and TRTX within the Real Estate platform.

Capital invested increased to $21.6 billion for the year ended December 31, 2021 compared to $9.9 billion for the year ended December 31, 2020, which was primarily attributable to TPG VIII and AAF within the Capital platform, TRTX within the Real Estate platform, Growth V within the Growth platform, Rise II within the Impact platform, and TPG Pace within the Market Solutions platform.

Capital invested decreased for the year ended December 31, 2020 compared to December 31, 2019, which was primarily attributable to a lower level of capital deployed within the Real Estate platform, as well as Growth II Gator within the Growth platform.

The decrease was partially offset by increased capital deployment within the Capital platform, specifically TPG VIII.

Realizations represent the aggregate investment proceeds generated by our TPG investment funds and co-investment vehicles and Public SPACs in conjunction with the completion of a business combination.

We believe this measure is useful to investors as it drives investment gains and performance allocations.

The table below presents realizations by platform for the years ended December 31, 2022, 2021 and 2020:

3 unchanged sentences

Capital $ 9,782 $ 15,773 $ 6,967

Growth 4,423 1,798 2,418

Real Estate 2,573 3,022 1,830

Growth 2,223 4,423 1,798

Impact 548 1,131 78

1 unchanged sentence

Total Realizations $ 15,530 $ 25,389 $ 10,673

Realizations increased to $25.4 billion for the year ended December 31, 2021 compared to $10.7 billion for the year ended December 31, 2020.

This was primarily attributable to a higher pace of realization activities in TPG VI, TPG VII and TPG VII Co-Invest within the Capital platform and Growth III and VI within the Growth platform.

Realizations decreased to $10.7 billion for the year ended December 31, 2020 compared to $12.1 billion for the year ended December 31, 2019.

This was primarily attributable to reduced realization activities in TRTX within the Real Estate platform, Growth II within the Growth platform and no business combinations associated with our consolidated Public SPACs in the Market Solutions platform in 2020.

Realizations were $15.5 billion for the year ended December 31, 2022 compared to $25.4 billion for the year ended December 31, 2021.

This was primarily attributable to lower realization activities during the year ended December 31, 2022 in TPG VII, TPG VIII, Asia VII and THP I within the Capital platform, Growth IV and TTAD I within the Growth platform and TRTX and TREP III within the Real Estate platform.

Realizations totaled $25.4 billion for the year ended December 31, 2021 compared to $10.7 billion for the year ended December 31, 2020.

This was primarily attributable to a higher pace of realization activities in TPG VI and TPG VII within the Capital platform and Growth III within the Growth platform.

Fund Performance Metrics

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An investment in us is not an investment in any of our funds.

This track record presentation is unaudited and does not purport to represent the respective fund’s financial results in accordance with

This track record presentation is unaudited and does not purport to represent the respective fund’s financial results in accordance with U.S.

There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns.

See “Item 1A—Risk Factors—Risks Related to Our Business—The historical returns attributable to our funds should not be considered as indicative of the future results of us or our funds or any returns expected on an investment in our Class A common stock.”

The following tables reflect the performance of our funds as of December 31, 2021 and supersede the preliminary estimated financial information presented in our Current Report on Form 8-K filed on February 18, 2022:

See “Item 1A.Risk Factors—Risks Related to Our Business—Our funds’ historical returns should not be considered as indicative of our or our funds’ future results or of any returns expected on an investment in our Class A common stock.”

The following tables reflect the performance of our funds as of December 31, 2022:

Fund Vintage Year (1)

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TPG VIII 2019 11,505 10,686 2,735 14,053 16,788 54 % 1.7x 35 % 1.4x

TPG IX 2022 8,876 513 — 595 595 NM NM NM NM

Capital Funds 78,703 69,227 111,673 19,994 131,667 23 % 1.9x 15 % 1.7x

6 unchanged sentences

Asia VII 2017 4,630 4,303 1,883 5,833 7,716 28 % 1.8x 18 % 1.5x

Asia VIII 2022 3,428 321 — 321 321 NM NM NM NM

Asia Funds 17,942 14,191 18,901 10,939 29,840 21 % 2.1x 15 % 1.7x

THP 2019 2,704 1,540 262 2,240 2,502 90 % 1.9x 52 % 1.5x

Healthcare Funds

THP I 2019 2,704 2,432 814 2,662 3,476 45 % 1.5x 25 % 1.3x

THP II 2022 1,956 225 — 261 261 NM NM NM NM

Healthcare Funds 4,660 2,657 814 2,923 3,737 45 % 1.5x 25 % 1.3x

Continuation Vehicles

TPG AAF 2021 1,317 1,167 24 1,370 1,394 NM NM NM NM

TPG AION 2021 207 207 — 207 207 NM NM NM NM

Continuation Vehicles 1,524 1,374 24 1,577 1,601 NM NM NM NM

TPG AAF 2021 1,317 1,314 75 2,425 2,500 61 % 1.9x 51 % 1.7x

TPG AION 2021 207 207 — 207 207 — % 1.0x (1) % 1.0x

Continuation Vehicles 1,524 1,521 75 2,632 2,707 53 % 1.8x 44 % 1.6x

Capital (excl-Legacy (15) )

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Capital 103,132 87,802 131,678 36,653 168,331 23 % 2.0x 15 % 1.7x

STAR 2007 1,264 1,259 1,851 72 1,923 13 % 1.5x 6 % 1.3x

Growth II 2011 2,041 2,184 4,651 617 5,268 22 % 2.5x 16 % 2.0x

Growth III 2015 3,128 3,085 4,178 2,715 6,893 32 % 2.2x 23 % 1.8x

Growth IV 2017 3,739 3,156 1,088 4,762 5,850 33 % 1.8x 22 % 1.5x

Gator 2019 726 685 581 613 1,194 47 % 1.7x 35 % 1.5x

Growth V 2020 3,558 1,907 — 2,475 2,475 NM NM NM NM

Growth Funds 14,456 12,276 12,349 11,254 23,603 22 % 2.0x 15 % 1.7x

Fund Vintage Year (1)

8 unchanged sentences

($ in millions)

STAR 2007 1,264 1,259 1,862 69 1,931 13 % 1.5x 6 % 1.3x

Growth II 2011 2,041 2,184 4,712 610 5,322 22 % 2.5x 16 % 2.0x

Growth III 2015 3,128 3,315 4,534 2,387 6,921 28 % 2.1x 19 % 1.7x

Growth IV 2017 3,739 3,568 1,834 4,556 6,390 25 % 1.8x 17 % 1.5x

Gator 2019 726 686 645 604 1,249 38 % 1.8x 28 % 1.6x

Growth V 2020 3,558 2,409 316 3,123 3,439 40 % 1.5x 25 % 1.3x

Growth Funds 14,456 13,421 13,903 11,349 25,252 21 % 1.9x 15 % 1.6x

TDM 2017 1,326 443 — 1,029 1,029 28 % 2.3x 23 % 2.0x

Tech Adjacencies Funds

TTAD I 2018 1,574 1,497 789 1,924 2,713 36 % 1.8x 29 % 1.6x

TTAD II 2021 2,501 518 — 518 518 NM NM NM NM

TTAD II 2021 2,963 1,567 — 1,569 1,569 (7) % 1.0x (16) % 0.9x

Tech Adjacencies Funds 4,537 3,064 789 3,493 4,282 33 % 1.5x 25 % 1.3x

Growth (excl-Legacy (15) )

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Rise II 2020 2,176 1,836 89 2,365 2,454 36 % 1.4x 20 % 1.2x

Rise III 2022 2,034 358 — 358 358 NM NM NM NM

The Rise Funds 6,316 4,079 1,360 5,161 6,521 26 % 1.7x 17 % 1.4x

1 unchanged sentence

Evercare 2019 621 416 16 523 539 8 % 1.3x 3 % 1.1x

Rise Climate 2021 6,731 137 — 139 139 NM NM NM NM

Rise Climate 2021 7,268 2,218 34 2,335 2,369 29 % 1.1x (21) % 0.9x

TPG NEXT (19)

2022 510 — — — — NM NM NM NM

Impact 15,048 6,846 1,778 8,019 9,797 25 % 1.5x 15 % 1.3x

1 unchanged sentence

DASA RE 2012 1,078 576 1,068 5 1,073 21 % 1.9x 15 % 1.6x

TPG RE II 2014 2,065 2,186 2,970 695 3,665 31 % 1.8x 21 % 1.6x

TPG RE III 2018 3,722 3,601 1,078 3,537 4,615 41 % 1.4x 30 % 1.3x

TREP II 2014 2,065 2,211 3,189 412 3,601 29 % 1.7x 19 % 1.5x

TREP III 2018 3,722 3,946 1,753 3,339 5,092 22 % 1.4x 16 % 1.3x

TREP IV 2022 6,820 555 9 546 555 NM NM NM NM

TPG Real Estate Partners 13,685 7,288 6,019 4,302 10,321 24 % 1.6x 17 % 1.4x

TRTX 2014 1,916 14 NM NM NM NM NM NM NM NM

TAC+ 2021 1,540 595 24 571 595 NM NM NM NM

TAC+ 2021 1,797 915 86 875 961 5 % 1.1x 1 % 1.0x

Real Estate 17,398 8,203 6,105 5,177 11,282 24 % 1.5x 16 % 1.3x

Fund Vintage Year (1)

Capital Committed (2)

Capital Invested (3)

Realized Value (4)

Unrealized Value (5)

Total Value (6)

Gross IRR (7)

Gross MoM (7)

Investor Net MoM (9)

($ in millions)

Market Solutions

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TPEP Long Only NM NM NM NM 1,653 NM NM (13)

TSCF 2021 1,108 100 — 109 109 NM NM NM NM

NewQuest I 2011 234 291 767 — 767 48 % 3.2x 37 % 2.3x

NewQuest II 2013 310 337 544 228 772 27 % 2.3x 21 % 1.9x

NewQuest III 2016 541 498 267 664 931 23 % 1.8x 15 % 1.5x

NewQuest IV 2020 1,000 611 5 846 851 112 % 1.5x 56 % 1.3x

TSCF 2021 1,108 186 13 162 175 (6) % 0.9x (8) % 0.9x

2022 455 88 — 88 88 NM NM NM NM

TPG TIGER (18)

2022 300 8 — 7 7 NM NM NM NM

TPG TIGER 2 (19)

2022 130 — — — — NM NM NM NM

NewQuest I (18)

2011 390 291 767 — 767 48 % 3.2x 37 % 2.3x

NewQuest II (18)

2013 310 337 571 172 743 25 % 2.3x 20 % 1.8x

NewQuest III (18)

2016 541 523 358 502 860 16 % 1.7x 10 % 1.4x

NewQuest IV (18)

2020 1,000 784 103 1,007 1,110 45 % 1.5x 25 % 1.3x

NewQuest V (18) (19)

2022 378 — — — — NM NM NM NM

Market Solutions (12)

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Vintage Year, with respect to a fund, represents the year in which the fund consummated its first investment (or, if earlier, received its first capital contributions from investors).

We recently adopted this standard for fund Vintage Year to better align with current market and investor benchmarking practices.

We adopted this standard for fund Vintage Year to better align with current market and investor benchmarking practices.

For consistency with prior reporting, however, the Vintage Year classification of any fund that held its initial closing before 2018 remains unchanged and represents the year of such fund’s initial closing.

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(7) Gross IRR and Gross MoM are calculated by adjusting Net IRR and Investor Net MoM to generally approximate investor performance metrics excluding management fees, fund expenses (other than interest expense and other fees arising from amounts borrowed under the fund’s credit facility to fund investments) and performance allocations.

With respect to interest expense and other fees arising from amounts borrowed under the fund’s credit facility to fund investments, we have assumed that investor capital contributions were made in respect thereof as of the midpoint of each relevant quarter in which such amounts were incurred.

With respect to interest expense and other fees arising from amounts borrowed under

the fund’s credit facility to fund investments, we have assumed that investor capital contributions were made in respect thereof as of the midpoint of each relevant quarter in which such amounts were incurred.

We have further assumed that distributions to investors occurred in the middle of the month in which the related proceeds were received by the fund.

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The Net IRR calculation excludes amounts attributable to the general partner, its affiliated entities and “friends of the firm” entities that generally pay no or reduced management fees and performance allocations.

Net IRR represents an average return for all included investors and does not necessarily reflect the actual return of any particular investor.

Net IRR represents an average return for all included investors, including those that pay reduced management fees and/or carried interest, and does not necessarily reflect the actual return of any particular investor.

An actual investor that paid management fees and/or carried interest at rates higher than the average would have a lower individual Net IRR.

In addition, management fees, fund expenses and carried interest differ from fund to fund, and therefore the impact of such amounts in a particular fund should not be assumed to reflect the impact such amounts would have on any other fund, including in respect of any fund in which a prospective investor is considering an investment.

Net IRR for a platform does not include the cash flows for funds that are not currently presenting a Net IRR to their investors.

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Investor Net MoM is calculated as the sum of cash distributed to investors and the investors’ ending capital balances as of the quarter end, divided by the amount of capital contributed to the fund by investors (which amount excludes, for the avoidance of doubt, any amounts borrowed by the fund in lieu of calling capital).

Investor Net MoM reflects the impact of management fees, fund expenses (including interest expense arising from amounts

borrowed under the fund’s credit facility) and performance allocations, but does not reflect the effect of taxes borne, or to be borne, by investors.

Investor Net MoM reflects the impact of management fees, fund expenses (including interest expense arising from amounts borrowed under the fund’s credit facility) and performance allocations, but does not reflect the effect of taxes borne, or to be borne, by investors.

The Investor Net MoM calculation excludes amounts attributable to the fund’s general partner, its affiliated entities and “friends of the firm” entities that generally pay no or reduced management fees and performance allocations.

Investor Net MoM represents an average multiple-of-money for all included investors and does not necessarily reflect the actual return of any particular investor.

An actual investor that paid management fees and/or carried interest at rates higher than the average would have a lower individual net MoM.

(10) “NM” signifies that the relevant data would not be meaningful.

Gross IRR and Gross MoM generally deemed “NM” during its initial period of operation, but in no event for more than two years after the date of the fund’s first investment;

in this period, we believe that these metrics do not accurately represent a fund’s overall performance given the impact of organizational costs and other fees and expenses that are typically incurred early in the life of a fund.

NM can also be used when the presented metric is not applicable to the product being shown.

Net IRR and Investor Net MoM for a fund are generally deemed “NM” during its initial period of operation, but in no event for more than two years after the date of the fund’s first investment;

in this period, TPG believes that these metrics do not accurately represent a fund’s overall performance given the impact of organizational costs and other fees and expenses that are typically incurred early in the life of a fund.

Performance metrics are generally deemed “NM” for an investment or group of investments when, among other reasons, a fund is in its initial period of operation, or the holding period of the investment or investments is in its initial period of holding, which in each case we typically determine to mean up to twelve months, or the investment or investments do not have a significant cost basis.

IRR metrics are generally deemed “NM” prior to the fund calling capital for the applicable investment(s).

(11) Amounts shown are in US dollars.

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The performance estimates are based on an investment in TPG Public Equity Partners, LP made on September 1, 2013, the date of TPEP’s inception, with the performance estimates for the period from January 1, 2016 to present being based on an investment in TPG Public Equity Partners Master Fund, L.P.

made through TPG Public Equity Partners-A, L.P., the “onshore feeder.” Gross performance figures (i) are presented after any investment-related expenses, net interest, other expenses and the reinvestment of dividends;

made through TPG Public Equity Partners-A, L.P., the “onshore feeder.” Gross performance figures (i) are

presented after any investment-related expenses, net interest, other expenses and the reinvestment of dividends;

(ii) include any gains or losses from “new issue” securities;

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Unrealized Value represents net asset value before redemptions.

(14) Capital Committed for TRTX includes $1,201 million of private capital raised prior to TRTX’s initial public offering and $716 million issued during and subsequent to TRTX’s initial public offering.

(14) Capital Committed for TRTX includes $1,201 million of private capital raised prior to TRTX’s initial public offering in July 2017 and $716 million issued during and subsequent to TRTX’s initial public offering.

(15) Legacy funds represent funds whose strategies are not expected to have successor funds but that have not yet been substantially wound down.

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(17) Total TPG track record amounts do not include results from RMB - Shanghai and RMB - Chongqing or China Ventures, a joint venture partnership.

(18) Unless otherwise specified, the fund performance information presented above for TGS, TPG TIGER, NewQuest I, NewQuest II, NewQuest III, NewQuest IV and NewQuest V is, due to the nature of their strategy, as of September 30, 2022.

Accordingly, the fund performance information presented above for the funds does not reflect any fund activity for the quarter ended December 31, 2022 and therefore does not cover the same period presented for other funds.

Any activity occurring during the quarter ended December 31, 2022 will be reflected in the performance information presented in future reporting.

(19) Certain funds recorded capital commitments prior to December 31, 2022, but were not activated or did not make their first investment.

Therefore the only activity reflected in the track record with respect to these funds was the capital commitments.

Liquidity and Capital Resources

Our liquidity needs primarily include working capital and debt service requirements.

We believe that our current sources of liquidity, which include cash generated by our operating activities, cash and funds available under our credit agreement, along with the proceeds from the IPO, are sufficient to meet our projected operating and debt service requirements for at least the next 12 months.

We believe that our current sources of liquidity, which include cash generated by our operating activities, cash and funds available under our credit agreement, are sufficient to meet our projected operating expenses, pay dividends to holders of our common stock in accordance with our dividend policy, debt service requirements and other obligations as they arise for at least the next 12 months.

To the extent that our current liquidity is insufficient to fund future activities, we may need to raise additional funds.

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Net cash provided by operating activities $ 1,375,878 $ 1,474,820 $ 95,393

Net cash (used in) provided by investing activities (37,745) (108,096) 17,404

Net cash used in investing activities (3,012) (37,745) (108,096)

Net cash (used in) provided by financing activities (1,238,080) (1,322,566) 250,329

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Cash and cash equivalents, end of period $ 1,120,650 $ 985,864 $ 871,355

As of December 31, 2021, TPG’s total liquidity was $1,302.7 million, comprised of $972.7 million of cash and cash equivalents, excluding $13.1 million of restricted cash, as well as $300.0 million and $30.0 million of incremental borrowing capacity under the Revolving Credit Facility to Affiliate and the Subordinated Credit Facility, respectively.

Total cash of $985.9 million as of December 31, 2021 is comprised of $242.4 million of cash that is attributable to the TPG Holdings Companies and on balance sheet securitization vehicles.

As of December 31, 2022, TPG’s total liquidity was $1,837.5 million, comprised of $1,107.5 million of cash and cash equivalents, excluding $13.2 million of restricted cash, as well as $700.0 million and $30.0 million of incremental borrowing capacity under the Senior Unsecured Revolving Credit Facility and the Subordinated Credit Facility (each as defined herein), respectively.

Total cash of $1,120.7 million as of December 31, 2022 is comprised of $691.7 million of cash that is attributable to the TPG Operating Group and on balance sheet securitization vehicles.

Total liquidity increased by $534.8 million, or 41%, relative to $1,302.7 million as of December 31, 2021.

This increase was the result of $114.5 million net increase in cash and cash equivalents primarily due to $1,474.8 million of net cash provided by operating activities offset by $1,322.6 million of net cash used in financing activities and $37.7 million of net cash used in investing activities.

This increase was the result of $134.8

million net increase in cash and cash equivalents primarily due to $1,375.9 million of cash provided by operating activities, partially offset by $1,238.1 million of net cash used in financing activities and $3.0 million of net cash used in investing activities.

Our operating activities primarily consist of investment management activities.

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Additionally, operating activities also reflect the activity of our consolidated TPG Funds and Public SPACs, which primarily include proceeds from sales of investments offset by cash outflows for purchases of investments and deposits of SPAC IPO proceeds into trust accounts.

Operating activities provided $1,474.8 million and $95.4 million for the years ended December 31, 2021 and 2020, respectively.

Key drivers consisted of performance allocation and co-investment proceeds totaling $2,179.1 million and $754.9 million for the years ended December 31, 2021 and 2020, respectively.

This was partially offset by purchases of investments totaling $173.9 million and $84.1 million for the years ended December 31, 2021 and 2020, respectively.

Operating activities provided $1,375.9 million and $1,474.8 million of cash for the years ended December 31, 2022 and 2021, respectively.

Key drivers consisted of performance allocation and co-investment proceeds totaling $754.9 million and $530.2 million for the years ended December 31, 2020 and 2019, respectively, as well as fee revenues.

This was partially offset by purchases of investments totaling $84.1 million and $77.9 million for the years ended December 31, 2020 and 2019, respectively.

Key drivers consisted of performance allocation and co-investment proceeds totaling $1,567.7 million and $2,179.1 million for the years ended December 31, 2022 and 2021, respectively.

This was partially offset by changes in operating assets and liabilities for the years ended December 31, 2022 and 2021, respectively.

Investing Activities

Our investing activities primarily consist of lending to affiliates and capital expenditures.

The primary sources of cash within the investing activities section include cash received from a note receivable from affiliates.

The primary uses of cash within the investing activities section includes capital expenditures and purchases of collateralized loan obligations.

Investing activities used $37.7 million and $108.1 million of cash during the years ended December 31, 2021 and 2020, respectively.

During the year ended December 31, 2021, cash used by investing activities is primarily related to transfers related to the Reorganization, offset by repayments of notes receivable from our affiliates and cash acquired, net of cash consideration, related to the acquisition of NewQuest.

During the year ended December 31, 2020, cash used in investing activities primarily reflects the reduction of cash related to the effect of deconsolidation of our former affiliate.

Investing activities used $108.1 million of cash during the year ended December 31, 2020 and provided $17.4 million cash during the year ended December 31, 2019.

During the year ended December 31, 2020, cash used in investing activities primarily reflects the reduction of cash related to the effect of deconsolidation of our former affiliate.

year ended December 31, 2019, cash provided by investing activities primarily reflects the net cash amounts received from a note receivable from affiliates.

The primary sources of cash within the investing activities section include cash received from notes receivable from affiliates.

The primary uses of cash within the investing activities section includes capital expenditures and cash advances on notes receivable from affiliates.

Investing activities used $3.0 million and $37.7 million of cash during the year ended December 31, 2022 and 2021, respectively.

During the year ended December 31, 2022, cash used by investing activities is primarily related to advances, offset by repayments of notes receivables from affiliates.

During the year ended December 31, 2021, cash used by investing activities primarily related to the acquisition of NewQuest described in Note 3 , “Acquisition,” to the Consolidated Financial Statements and transfers related to the Reorganization described in Note 1 , “Organization,” to the Consolidated Financial Statements.

Financing Activities

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The primary sources of cash within the financing activities section includes proceeds from debt and notes issuances.

The primary uses of cash within the financing activities section include distributions to partners and non-controlling interests and repayments of debt and notes.

The primary uses of cash within the financing activities section include dividends to holders of our common stock, distributions to partners and non-controlling interests and repayments of debt and notes.

Net cash provided by financing activities also reflects the financing activity of our consolidated funds, which primarily include cash inflows and outflows from consolidated funds related to their capital activity.

Financing activities used $1,322.6 million of cash during the years ended December 31, 2021 and provided $250.3 million of cash during the years ended December 31, 2020.

During the year ended December 31, 2021, cash used in financing activities primarily reflects the net impact of distributions to partners and non-controlling interests, the repayment of amounts borrowed under the Revolving Credit Facility to Affiliate, and payments of underwriting and offering costs, which is partially offset by the net impact of redeemable equity raised in our consolidated Public SPACs and proceeds received under the Senior Unsecured Term Loan.

During the year ended December 31, 2020, cash provided by financing activities primarily reflects the net impact of redeemable equity raised in our consolidated Public SPACs, partially offset by the distributions to partners and non-controlling interests.

Financing activities provided $250.3 million of cash during the year ended December 31, 2020 and used cash of $825.4 million for the year ended December 31, 2019.

During the years ended December 31, 2019, cash used in financing activities primarily reflects the net impact of distributions to partners and non-controlling interests, partially offset by the proceeds from the Series A and B Securitization Notes issuances.

Financing activities used $1,238.1 million and $1,322.6 million of cash during the year ended December 31, 2022 and 2021, respectively.

During the year ended December 31, 2022, cash used in financing activities primarily reflects the net impact of distributions to partners and non-controlling interests, the repayment of amounts borrowed under the Subordinated Credit Facility, and purchase of partnership interests with IPO proceeds, which is partially offset by the net proceeds from the IPO in January 2022.

During the year ended December 31, 2021, cash used by financing activities primarily reflects the distributions to partners and non-controlling interests.

Credit Facilities

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The Subordinated Credit Facility is available for direct borrowings and is guaranteed by certain members of TPG Operating Group.

In July 2021, the subsidiary extended the maturity date of the Subordinated Credit Facility from August 2022 to August 2023.

The interest rate for borrowings under the Subordinated Credit Facility is calculated at the LIBOR rate at the time of borrowing plus 2.25%.

During the year ended December 31, 2021, the subsidiary neither borrowed nor made repayments on the Subordinated Credit Facility.

During the year ended December 31, 2020, the subsidiary borrowed $55.0 million and made repayments of $55.0 million on the Subordinated Credit Facility, leaving a zero balance as of December 31, 2020.

During the year ended December 31, 2019, the subsidiary borrowed $3.0 million and made repayments of $3.0 million on the Subordinated Credit Facility, with no outstanding borrowings as of December 31, 2019.

During each of the years ended December 31, 2021, 2020 and 2019, the subsidiary incurred interest expense and uncommitted line of credit fees on the Subordinated Credit Facility of $0.2 million, $0.2 million and $0.1 million, respectively.

In August 2022, the subsidiary extended the maturity date of the Subordinated Credit Facility from August 2023 to August 2024, replaced LIBOR as the applicable reference rate with SOFR and otherwise conformed the credit facility to accommodate SOFR as the reference rate.

The interest rate for borrowings under the Subordinated Credit Facility is calculated at a term SOFR rate plus a 0.10% per annum adjustment and 2.25%.

During the year ended December 31, 2022, the subsidiary borrowed $30.0 million and made repayments of $30.0 million on the Subordinated Credit Facility, leaving a zero balance at December 31, 2022.

Secured Borrowings

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Tranche B secured borrowings (the “Series B Securitization Notes” or, collectively with the Series A Securitization Notes, the “Securitization Notes”) were issued in October 2019 at a fixed rate of 4.75% with an aggregate principal balance of $50.0 million due June 20, 2038, with interest payable semiannually.

The secured borrowings contain an optional redemption feature giving us the right to call the notes

in full or in part, subject to a prepayment penalty if called before May 2023.

The secured borrowings contain an optional redemption feature giving us the right to call the notes in full or in part, subject to a prepayment penalty if called before May 2023.

If the secured borrowings are not redeemed on or prior to June 20, 2028, we will pay additional interest equal to 4.00% per annum.

Interest expense related to the Securitization Notes for years ended December 31, 2021, 2020 and 2019 was approximately $13.3 million, $13.1 million and $11.9 million, respectively.

The secured borrowings contain covenants and conditions customary in transactions of this nature, including negative pledge provisions, default provisions and financial covenants and limitations on certain consolidations, mergers and sales of assets.

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In May 2018, TPG Holdings, L.P.

entered into an amended and restated Revolving Credit Facility Agreement under which certain terms were modified, including reduced commitments of $300.0 million, an extension of the maturity to May 2023 and the redefinition of certain components of financial covenants.

amended and restated the Senior Unsecured Revolving Credit Facility Agreement to, among other things, reduce commitments to $300.0 million, extend the maturity to May 2023 and redefine certain components of the financial covenants.

In November 2020, TPG Holdings, L.P.

entered into an amended and restated Revolving Credit Facility Agreement under which certain terms were modified, including releasing all collateral pledged under the prior Revolving Credit Facility Agreement and extending the maturity to November 2025.

further amended and restated the facility to, among other things, release all collateral pledged under the prior amendment to the facility and to extend the maturity to November 2025.

In November 2021, TPG Holdings, L.P.

entered into an amended and restated Revolving Credit Facility Agreement under which certain terms were modified, including that TPG Holdings, L.P.

entered into a fourth amendment and restatement of the Senior Unsecured Revolving Credit Facility Agreement under which certain terms were modified, including that TPG Holdings, L.P.

may elect to have (i) TPG Operating Group II, L.P.

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was thereby released from its obligations as borrower thereunder) and correspondingly, TPG Operating Group II, L.P., TPG Holdings I-A, LLC, TPG Holdings II-A, LLC and TPG Holdings III-A, L.P were released from their guarantees of the Senior Unsecured Revolving Credit Facility.

The interest rate for borrowings on the Senior Unsecured Revolving Credit Facility is calculated at the LIBOR rate at the time of the borrowing plus an applicable margin not to exceed 1.75% (subject to credit rating based stepdowns).

During the year ended December 31, 2021, TPG Holdings, L.P.

made no borrowings and made repayments of $50.0 million on the Senior Unsecured Revolving Credit Facility, leaving a balance of zero at December 31, 2021.

During the year ended December 31, 2020, TPG Holdings, L.P.

borrowed $150.0 million and made repayments of $100.0 million on the Senior Unsecured Revolving Credit Facility, leaving a balance of $50.0 million as of December 31, 2020.

During the year ended December 31, 2019, TPG Holdings, L.P.

neither borrowed nor made repayments on the Senior Unsecured Revolving Credit Facility, leaving a zero balance as of December 31, 2019.

In July 2022, we entered into a fifth amendment and restatement of the Senior Unsecured Revolving Credit Facility to among other things, (i) extend the maturity date of the revolving credit facility from November 2025 to July 2027, (ii) increase the aggregate revolving commitments thereunder from $300.0 million to $700.0 million and (iii) replace LIBOR as the applicable reference rate with SOFR and otherwise conform the credit facility to accommodate SOFR as the reference rate.

Dollar-denominated principal amounts outstanding under the Senior Unsecured Revolving Credit Facility accrue interest, at the option of the applicable borrower, either (i) at a base rate plus applicable margin not to exceed 0.25% per annum or (ii) at a term SOFR rate plus a 0.10% per annum adjustment and an applicable margin not to exceed 1.25%.

We are also required to pay a quarterly commitment fee on the unused commitments under the Amended Senior Unsecured Revolving Credit Facility not to exceed 0.15% per annum, as well as certain customary fees for any issued letters of credit.

In August 2022, we entered into a first amendment to the Amended Senior Unsecured Revolving Credit Facility, which provides that if the Company is not publicly rated, the applicable margin for borrowings under the facility may be determined using the Company’s leverage ratio.

During the year ended December 31, 2022, we made no borrowings or repayments on the Senior Unsecured Revolving Credit Facility, leaving a balance of zero at December 31, 2022.

As of December 31, 2022, $700.0 million was available to be borrowed under the terms of the Senior Unsecured Revolving Credit Facility.

Senior Unsecured Term Loan

In December 2021, TPG Operating Group II, L.P.

entered into a credit agreement (the “Senior Unsecured Term Loan Agreement”) pursuant to which the lenders thereunder have agreed to make term loans in a principal amount of up to $300.0 million during the period commencing on December 2, 2021 and ending on the date that is 30 days thereafter.

In December 2021, we entered into a credit agreement (the “Senior Unsecured Term Loan Agreement”) pursuant to which the lenders thereunder agreed to make term loans in a principal amount of up to $300.0 million during the period commencing on December 2, 2021 and ending on the date that is 30 days thereafter.

Unused commitments were terminated at the end of such period.

As of December 31, 2021, $200.0 million was outstanding under the Senior Unsecured Term Loan Agreement.

The term loans have an interest rate of LIBOR plus 1.00% and will mature in December 2024.

The proceeds from the term loan were used to make a ratable distribution to each of our investors and will not be available for our operations.

As of December 31, 2022, $200.0 million was outstanding under the Senior Unsecured Term Loan Agreement and will mature in December 2024.

The proceeds from the term loan were used to make a ratable distribution to each of our investors and are not available for our operations.

In July 2022, we entered into an amended Senior Unsecured Term Loan Agreement.

The amended Senior Unsecured Term Loan Agreement, among other things, replaces LIBOR as the applicable reference rate with SOFR, and otherwise conforms the term loan agreement to accommodate SOFR as the reference rate.

Principal amounts outstanding under the amended Senior Unsecured Term Loan Agreement accrue interest, at the option of the borrower, either (i) at a base rate plus an applicable margin of 0.00% or (ii) at a term SOFR rate plus a 0.10% per annum adjustment and an applicable margin of 1.00%.

Tax Receivable Agreement

The future exchanges by owners of Common Units for cash from a substantially concurrent public offering, reorganization or private sale (based on the price per share of the Class A common stock on the day before the pricing of such public offering or private sale) or, at our election, for shares of our Class A common stock on a one-for-one basis (or, in certain cases, for shares of nonvoting Class A common stock) are expected to produce or otherwise deliver to us favorable tax attributes that can reduce our taxable income.

We (and our wholly-owned subsidiaries) are a party to a tax receivable agreement, under which generally we (or our wholly-owned subsidiaries) are required to pay the beneficiaries of

the Tax Receivable Agreement 85% of the applicable cash savings, if any, in U.S.

We (and our wholly-owned subsidiaries) are a party to a tax receivable agreement, under which generally we (or our wholly-owned subsidiaries) are required to pay the beneficiaries of the Tax Receivable Agreement 85% of the applicable cash savings, if any, in U.S.

federal, state and local income tax that we actually realize or, in certain circumstances, are deemed to realize as a result of the Covered Tax Items.

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(or our wholly-owned subsidiaries), and we expect that the payments we will be required to make under the Tax Receivable Agreement will be substantial.

See “Item 13.—Certain Relationships and Related Transactions, and Director Independence—Reorganization- and IPO-Related Transactions—Tax Receivable Agreement.”

Contractual Obligations

In the ordinary course of business, we enter into contractual arrangements that require future cash payments.

The following table sets forth information regarding our anticipated future cash payments under our contractual obligations as of December 31, 2021:

The following table sets forth information regarding our anticipated future cash payments under our contractual obligations as of December 31, 2022 (in thousands):

Payments Due by Period

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Additional Contingent Obligations

As of December 31, 2021 and 2020, if all investments held by the TPG funds were liquidated at their current unrealized fair value, there would be clawback of $58.3 million related to STAR and $60.7 million related to STAR and TES I, net of tax, respectively, for which a performance allocation reserve was recorded within other liabilities in the consolidated financial statements.

As of December 31, 2022 and December 31, 2021, if all investments held by the TPG funds were liquidated at their current unrealized fair value, there would be clawback of $58.3 million related to STAR, net of tax, for which a performance allocation reserve was recorded within other liabilities in the Consolidated Financial Statements.

The potential liquidation of STAR in 2023 could require clawback payments.

Additionally, if all remaining investments were deemed worthless, a possibility management views as remote, the amount of performance allocations subject to projected clawback as of December 31, 2021 and 2020 would be $1,500.9 million and $823.0 million on a pre-tax basis, respectively.

As of December 31, 2021 and 2020, we had guarantees outstanding totaling $96.1 million and $30.3 million, respectively, related to employee guarantees primarily related to a third-party lending program which enables certain of our eligible employees to obtain financing for co-invest capital commitment obligations with a maximum potential exposure of $139.7 million and $134.5 million, respectively.

Additionally, if all remaining investments were deemed worthless, a possibility management views as remote, the amount of performance allocations subject to projected clawback as of December 31, 2022 and December 31, 2021 would be $1,869.4 million and $1,500.9 million on a pre-tax basis, respectively.

As of December 31, 2022 and December 31, 2021, we had guarantees outstanding totaling $100.8 million and $96.1 million, respectively, related to employee guarantees primarily related to a third-party lending program which enables certain of our eligible employees to obtain financing for co-invest capital commitment obligations with a maximum potential exposure of $163.7 million and $139.7 million, respectively.

The following is a summary of cash dividends declared per share on our Class A common stock during the year ended December 31, 2022:

Date Declared Record Date Payment date Dividend per Class A Common Share

May 10, 2022 May 20, 2022 June 3, 2022 $ 0.44

August 9, 2022 August 19, 2022 September 2, 2022 $ 0.39

November 9, 2022 November 21, 2022 December 2, 2022 $ 0.26

On February 15, 2023, our board of directors declared and approved a cash dividend of $0.50 per share of Class A common stock for the three months ended December 31, 2022.

The Class A common stock dividend is payable on March 10, 2023, to the holders of record of our Class A common stock as of February 27, 2023.

Off-Balance Sheet Arrangements

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Critical Accounting Policies

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets, and liabilities and disclosure of contingent assets and liabilities in our financial statements.

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For any given period, performance allocations on our consolidated statements of operations may include reversals of previously recognized amounts due to a decrease in the value of a particular fund that results in a decrease of cumulative performance allocations earned to date.

Since fund minimum level of returns are cumulative, previously recognized performance allocations also may be reversed in a period of appreciation that is lower than the particular fund’s minimum return levels.

Since fund minimum level of returns are cumulative, previously recognized performance

allocations also may be reversed in a period of appreciation that is lower than the particular fund’s minimum return levels.

Each fund is considered separately in this regard and, for a given fund, performance allocations can never be negative over the life of a fund.

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Market price observability is affected by a number of factors, including the type of financial instrument, the characteristics specific to the financial instrument and the state of the marketplace—including the existence and transparency of transactions between market participants.

Financial instruments

with readily available quoted prices in active markets generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Financial instruments with readily available quoted prices in active markets generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs used in the determination of their fair values, as follows:

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the amount of the discount, if taken, shall be determined based on the time period that must pass before the restricted security becomes unrestricted or otherwise available for sale.

Refer to Note 2 , “Summary of Significant Accounting Policies, ” to our Consolidated Financial Statements for details on a recent accounting pronouncement related to the Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions and its expected impact on the Company’s Consolidated Financial Statements.

Fair Value of Investments or Instruments that are not Publicly Traded

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This would typically be the income approach, which provides an indication of fair value based on the present value of cash flows that a business, security or property is expected to generate in the future.

widely used methodology under the income approach is the discounted cash flow method, which includes significant assumptions about the underlying investment’s projected net earnings or cash flows, discount rate, capitalization rate and exit multiple.

The most widely used methodology under the income approach is the discounted cash flow method, which includes significant assumptions about the underlying investment’s projected net earnings or cash flows, discount rate, capitalization rate or exit multiple.

Depending on the facts and circumstances associated with the investment, different primary and secondary methodologies may be used including direct capitalization method, option value, contingent claims or scenario analysis, yield analysis, projected cash flow through maturity or expiration, probability weighted methods or recent round of financing.

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For investments valued utilizing a forward-looking market approach and/or income method, and where TPG has information rights, we generally have a direct line of communication with each of the Portfolio Company finance teams and collect financial data used to support projections used in the analysis.

The respective business unit’s valuation team or deal team then analyzes the data received and updates the valuation models, reflecting any changes in the underlying forecast, cash flow projections, weighted-average cost of capital, exit multiple and any other valuation input relevant economic conditions.

The results of all valuations of investments held by TPG funds and investment vehicles are reviewed and approved by the relevant Fund’s Valuation Committee.

Each Valuation Committee is comprised of at least one member who does not participate in the process of making or disposing of investments.

The respective product’s valuation team or deal team then analyzes the data received and updates the valuation models, reflecting any changes in the underlying forecast, cash flow projections, weighted-average cost of capital, exit multiple and any other valuation input relevant economic conditions.

The results of all valuations of investments held by TPG funds and investment vehicles are initially reviewed and approved by the relevant Product’s Valuation Committee.

Each Product Valuation Committee is comprised of at least one member who does not participate in the process of making or disposing of investments.

The valuations are subject to final approval by TPG’s Global Valuation Committee, which is comprised of senior employees and includes its Chief Financial Officer, General Counsel, Chief Compliance Officer, Chief Operating Officer and Chief Accounting Officer.

Approval by any member of the Valuation Committee is related to such member’s role in the Committee, such that control function members’ (i.e., those members who do not participate in the process of making or disposing of investments) approval, for example, represents their confirmation that the process was run appropriately and that the deliberations were on the merits.

To further corroborate results, each business unit generally engages an external valuation firm to provide positive assurance on a quarterly basis for a majority of Level III investments that have been held by TPG funds and investment vehicles for at least one full quarter.

To further corroborate results, each product’s valuation team generally engages an external valuation firm to provide positive assurance on a quarterly basis for a majority of Level III investments that have been held by TPG funds and investment vehicles for at least one full quarter.

Investments may be excluded from review if the valuation is based on a recent transaction, upcoming transaction or certain categorical deals (e.g., Biotech deals).

The global outbreak of COVID-19 required management to make significant judgments about the ultimate adverse impact of COVID-19 on financial markets and economic conditions, which is uncertain and may change over time.

These judgments and estimates were incorporated into the valuation process outlined herein.

Management’s policies were unchanged and critical processes were executed in a remote working environment.

Recent Accounting Developments

1 unchanged sentence

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What changed 10-K

Item 7. Management’s Discussion and Analysis