Mesirow Private Equity
Notes on Performance Data
Mesirow
Co-Investment Funds
Gross IRRs: Gross IRR is net of the sponsor's fees, expenses and carried interest, but gross of the fees and other expenses of MFPEA. Performance information that is provided gross of fees does not reflect the
deduction of advisory fees. Client returns will be reduced by such fees and other expenses that may be incurred in the management of the account. Advisory fees are described in Part 2A of Form ADV of
MFPEA.
Net IRRS: The net IRR of VII-B described herein for the period since inception (2017) through 6/30/2021 (48.8%) has been calculated using actual limited partner monthly cash outflows and inflows, and include
terminal values equal to the aggregate values of limited partner capital accounts. Such limited partner capital accounts reflect the limited partners' pro rata share of the fund's net assets including investments, the
values of which are determined by the general partner in accordance with valuation policies. Actual realized returns on unrealized investments will depend on a number of factors (including future operating
results, the value of the assets and market conditions at the time of disposition, any related transaction costs and the timing and manner of sale) that may differ significantly from the assumptions used in
determining the unrealized values. Accordingly, the actual realized returns on these unrealized investments may differ materially from returns indicated herein. The performance results of VII-B also reflect the
reinvestment of certain proceeds and other earnings. A client-specific net IRR may differ from the aggregate limited partner net IRR due to differences among clients in terms of commitment size, management
fee rate and closing date.
Core Co-Investment Track Record as of 6/30/2021: The gross core co-investment composite was constructed by aggregating the actual cash flows of the 61 buyout, growth equity and late-stage venture capital
co-investments in which the Firm has participated since the inception of the co-investment strategy in 2001. These 61 investments were made by the Firm's four commingled co-investment funds, Mesirow
Capital Partners VIII, L.P. (MCP VIII), a 2001 vintage year fund, Mesirow Financial Capital Partners IX, L.P. (MCP IX), a 2005 vintage year fund, Mesirow Financial Capital Partners X, L.P. (MCP X), a 2009
vintage year fund, Mesirow Financial Private Equity Fund VII-B, L.P. (Fund VII-B), a 2017 vintage year fund and Mesirow Financial Private Equity Fund VIII-B, L.P. (Fund VIII-B), a 2021 vintage year fund. The
Firm no longer participates in early-stage venture capital co-investments or lead sponsored buyout investments. Therefore, all early-stage venture capital co-investments (5) and lead sponsored buyout
investments (1) have been excluded from the core co-investment track record.
The total value of unrealized investments was determined by the general partner in accordance with valuation policies, a copy of which can be provided upon request. Actual realized returns on unrealized
investments will depend on a number of factors (including future operating results, the value of the assets and market conditions at the time of disposition, any related transaction costs and the timing and manner
of sale) that may differ significantly from the assumptions used in determining the unrealized values. Accordingly, the actual realized returns on these unrealized investments may differ materially from returns
indicated herein.
The estimated net core co-investment composite was constructed by applying hypothetical management fees and expenses to the gross core co-investment composite for MCP VIII, MCP IX and MCP X and
actual net cash flows for Fund VII-B and Fund VIII-B. A hypothetical annual management fee of 1% of committed capital was applied over the first seven years, and was reduced by 10% of the prior year's fee
beginning in year eight for MCP VIII, MCP IX and MCP X. The composite maintains the original timing of the management fee reduction for each of the four commingled co-investment funds comprising the
composite. The composite also applies the average annual expenses of each commingled co-investment fund on a quarterly basis (MCP VIII was 8 bps, MCP IX was 8 bps, MCP X was 14 bps). Finally, the net
composite assumes a carried interest charge of 10% of cumulative net gain after full return of contributed capital per each commingled co-investment fund, 15% after 2.25x (gross).
Model or hypothetical performance information and results do not reflect actual trading or asset or fund advisory management and the results may not reflect the impact that material economic and market factors
may have had, and can reflect the benefit of hindsight, on Mesirow Financial Private Equity Advisor, Inc.'s (MFPEA) decision-making if MFPEA were actually managing client's money. Past performance is not
indicative of future results. The returns presented in the chart above do not represent returns achieved by any particular Mesirow Private Equity fund or any investor in a Mesirow Private Equity fund.
General: The performance information shown in this presentation has not been audited. Past performance is not indicative of future results, and there is a possibility of loss in connection with any investment.
Additional performance information is available upon request. Please refer to important disclosure information included in the "Disclosure" at the end of this section.
23 | MESIROW PRIVATE EQUITY
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