Pinnacle’s London affiliate, Life Cycle Investment Partners, has secured over $15 billion in funds under management (FUM) as overseas flows shake up its investment composition.
Pinnacle took a stake in Life Cycle last May, which was formed by a team of global equity managers who departed from established UK fund manager Royal London Asset Management (RLAM). Its long-only Life Cycle Global Share Fund seeks to invest in the corporate life cycle where companies fit into one of five categories: accelerating, compounding, fading, mature, or turnaround.
In its full-year results for FY25, Pinnacle said Life Cycle now has $15.4 billion in funds under management despite initial delays to its launch as a result of non-compete clauses imposed by RLAM.
The sum is already three-quarters of the volume of FUM the team managed at RLAM at the time of their exit ($20 billion) and makes up 8.4 per cent of Pinnacle’s total affiliate FUM of $179.4 billion.
Out of Pinnacle’s 18 affiliates, this is the “fastest to date in terms of FUM growth and speed to profitability”, and the firm has a “significant opportunity” to diversify its FUM further with new strategy launches as well as gain new flows once its funds have an established track record.
As a result of the success, Pinnacle has added four hires to its UK distribution team, opened a London office for Canadian affiliate Langdon Equity Partners, and taken a stake in London-based Pacific Asset Management.
Going forward, it wants to support the growth of current affiliates with increased investment in distribution channels and invest in new affiliates and strategies where management teams have a strong track record and growth potential.
Particularly in the northern hemisphere, it is hopeful Life Cycle’s UK success will give Pinnacle a “reputational halo” to attract further prospective affiliates and investment talent.
Flows shake up
These overseas flows are shaking up the composition of Pinnacle’s FUM, with retail and international flows jumping from 29 per cent of FUM five years ago to 51 per cent now. International money accounted for $51.4 billion of FUM in FY25, a jump of 179 per cent over the year, with international net inflows of $4.8 billion during the year, while retail FUM stood at $39.7 billion.
This represents a substantial shift in the composition of its FUM since it first listed in 2016, when 84 per cent of Pinnacle’s $19.8 billion FUM was sourced from Australian institutions only.
It now has $48 billion FUM in its internationally domiciled affiliates, and said the addressable market outside of Australia “are many multiples larger in size” with dominant inflows coming from the UK, New Zealand, and Canada.
Reflecting on the last five years which focused heavily on making affiliate moves, it said: “Pinnacle has pursued a deliberate strategy of diversification, incubating new affiliates and strategies, enhanced by careful acquisitive growth into new asset classes and markets. This moderates short-term profitability, however previous initiatives have delivered exceptional returns.
“Having ‘peaked’ over 2H FY23 and 1H FY24, the ‘net’ cost to Pinnacle of current Horizon 2 initiatives reduced in 2H FY24 and remained at these levels over FY25, at a total net cost to Pinnacle, after tax, of $9 million. Entering FY26, all Pinnacle affiliates are now at run-rate profitability or better.
“Successfully executing investments (build or buy) in well-positioned affiliates – geographically, reputationally and strategy-wise – significantly contributes to our ongoing distribution success as well as strengthening our reputation among investors, prospective affiliates, and distribution talent.”
