Victory Capital Holdings, Inc. (Victory Capital) operates as a global asset management company.
The company’s differentiated business model combines boutique investment qualities with the benefits of an integrated, centralized (not standardized) operating and distribution platform.
Victory Capital provides specialized investment strategies to institutions, intermediaries, retirement platforms and individual investors. With 11 autonomous Investment Franchises and a Solutions Platform, Victory C...
Victory Capital Holdings, Inc. (Victory Capital) operates as a global asset management company.
The company’s differentiated business model combines boutique investment qualities with the benefits of an integrated, centralized (not standardized) operating and distribution platform.
Victory Capital provides specialized investment strategies to institutions, intermediaries, retirement platforms and individual investors. With 11 autonomous Investment Franchises and a Solutions Platform, Victory Capital offers a wide array of investment products, including actively and passively managed mutual funds, rules-based and active exchange traded funds (ETFs), institutional separate accounts, variable insurance products (VIPs), alternative investments, private closed end funds, and a 529 Education Savings Plan. Victory Capital’s strategies are also offered through third-party investment products, including mutual funds, third-party ETF model strategies, retail separately managed accounts (SMAs) and unified managed accounts (UMAs) through wrap account programs, Collective Investment Trusts (CITs), and undertakings for the collective investment in transferable securities (UCITS). As of December 31, 2024, the company’s Franchises and its Solutions Platform collectively managed a diversified set of 124 investment strategies.
The company designs logos and the marks ‘Victory Capital,’ ‘Victory Capital Management,’ ‘Victory Funds,’ ‘VictoryShares,’ ‘Victory Capital inVest,’ ‘Victory Capital Solutions,’ ‘inVest,’ ‘Munder,’ ‘Munder Capital Management,’ ‘New Energy Capital,’ ‘THB,’ ‘The Road to Victory,’ ‘RS Investments,’ ‘Sycamore Capital,’ ‘Trivalent Investments,’ ‘Victory Income Investors’, ‘USAA 529 Education Savings Plan,’ and ‘WestEnd Advisors,’ are pending, owned, or licensed for a period of time by the company or one of its subsidiaries.
Growth Strategy
The company has a purposeful strategy designed to achieve lasting profitable growth and success for its clients, its employees, and its shareholders. The growth the company pursues is both organic and inorganic.
Organic Growth –The company seeks to grow organically by offering strategies that are value-added, and solution oriented to investment portfolios with strong risk-adjusted performance track records over the long term. A key driver of the company’s growth strategy lies in enhancing the strength of its existing Franchises. The company primarily does this by providing them with access to its operating platform, technology, distribution, marketing, and other support functions. The company also helps its Franchises through new product development and product packaging.
The company continually evaluates and makes investments to improve its operating platform. Recent initiatives include investments in artificial intelligence (AI), data and analytics, technology, distribution, and marketing to enhance organic growth in the company’s business and increase the effectiveness of its distribution channels.
Inorganic Growth –The company complements its organic growth through strategic acquisitions. The company primarily seeks to acquire investment management firms that will add high quality investment teams, enhances its growth and financial profile, improves the company’s diversification by asset class and investment capability, achieves its integration and synergy expectations, and expands the company’s distribution capabilities.
One of the company’s key advantages in a competitive merger and acquisition environment is its ability to provide access to multiple distribution channels. The company’s distribution and marketing platforms drive organic growth at its acquired Franchises both by opening new distribution channels and penetrating deeper into existing ones. This support received from the company’s sales and marketing professionals allows its investment professionals to focus primarily on delivering investment excellence.
During 2024, the company entered into a definitive agreement with Amundi SA (Amundi) to combine their U.S. operations (‘Amundi US’) into Victory Capital, to establish long-term global distribution agreements, and Amundi to become a strategic shareholder of Victory Capital.
The company regularly evaluates potential acquisition candidates and maintain a strong network of industry participants and advisors who provide opportunities to establish potential target relationships and source transactions.
Alternative Investments –The company launched its alternative investments platform with the acquisition of New Energy Capital (NEC). The company offers both open-end liquid alternative investments as well as closed-end private funds. Given the company’s multi-faceted distribution channels, combined with its ability to develop investment vehicles to deliver these strategies, the company is ideally situated to play a role in democratizing access to alternative investments for retail investors.
Diversification Strategy
The company offers an array of equity, fixed income, investment models, alternative investments, closed end private funds, and solutions strategies that encompass a diverse spectrum of market capitalization segments, industry sectors, investment styles and approaches.
Within individual asset classes and strategies, the company’s Franchises employ different investment approaches. This diversification reduces the correlation between investment return streams generated by multiple Franchises investing within the same asset class. For example, the company has two Franchises (Trivalent and Sophus) focused on Emerging Markets within global/non-U.S. equity, each with a different investment approach. Trivalent’s investment team primarily focuses on quantitative analysis for stock selection, combined with some fundamental analysis.
The company’s multi-channel distribution capabilities provide another degree of diversification, with approximately 41% of its Total AUM from retail and retirement clients, 35% from direct investor clients, 24% from institutional clients, as of December 31, 2024. Within these channels, clients are further diversified among intermediary (broker dealer and RIAs) platforms, sub advisory relationships, corporate and public entities, insurance companies, 529 Education Saving Plan participants, Taft-Hartley plans, endowments, and Family Offices.
Investment Franchises
The company’s 11 Investment Franchises and Solutions Platform are not separate legal entities. Their distinct names and brands are designed to embody and reinforce their respective autonomy and investment processes in the market. The company’s Solutions platform, no Investment Franchise accounts for more than 20% of total AUM, it is well diversified across asset classes and investment approaches. The company’s Investment Franchises are independent from one another from an investment process perspective, maintain their own separate brands and logos, which have been built over time, and are led by dedicated Chief Investment Officers (CIOs) or a dedicated management team. The company customizes each Franchise’s integration with its operating platform to optimize their investment processes.
Integrity Asset Management
Integrity Asset Management utilizes a dynamic value-oriented approach to the U.S. mid- and small-capitalization companies. Integrity conducts fundamental stock research to find attractive companies that have compelling discounts to the prevailing market conditions. The company’s Integrity Investment Franchise includes 10 investment professionals with average industry experience of approximately 25 years.
Munder Capital Management
Munder Capital Management has an experienced team utilizing a Growth-at-a-Reasonable-Price “GARP” strategy in the U.S. equity markets designed to generate consistently strong performance over a market cycle. Munder performs extensive fundamental research in order to find attractive growth companies that it expects will exceed market expectations. Of the companies with independently determined growth attributes, valuation is applied to find the most inexpensive growth companies. The company’s Munder Investment Franchise includes four investment professionals with an average industry experience of approximately 24 years.
New Energy Capital
NEC manages alternative investments in private closed end funds, with investment periods ranging between five and 10 years. NEC was one of the first investors to focus on clean energy and infrastructure investments of small-and mid-sized clean energy infrastructure projects and companies. NEC’s investments provide growth capital in all forms across the capital structure from credit to equity, as well as hybrid financing arrangements. The company’s NEC Investment Franchise includes five investment professionals with average industry experience of approximately 18 years.
NewBridge Asset Management
NewBridge Asset Management applies a high conviction growth-oriented strategy focusing on the U.S. large-capitalization companies experiencing superior long-term growth rates with strong management teams. NewBridge portfolios usually holds between 25 and 35 securities. The company’s NewBridge Investment Franchise includes four investment professionals with average industry experience of approximately 27 years.
RS Investments
RS Investments is made up of three distinct investment teams each with its own CIO: (i) RS Value, (ii) RS Growth and (iii) RS Global. RS Value and RS Growth apply an original and proprietary fundamental approach to investing in value and growth-oriented U.S. equity strategies. RS Global utilizes a highly disciplined quantitative approach to managing core-oriented global and international equity strategies. The company’s RS Investments Investment Franchise teams total 23 members, including 18 investment professionals with average industry experience of approximately 23 years.
Sophus Capital
Sophus Capital utilizes a disciplined quantitative process that accesses market conditions in emerging equity markets and rank orders attractive companies that are further researched from a fundamental basis. The company’s Sophus Investments Franchise includes nine investment professionals with average industry experience of approximately 22 years.
Sycamore Capital
Sycamore Capital applies a quality value-oriented approach to the U.S. mid- and small- capitalization companies. Sycamore conducts fundamental research to find companies with strong high-quality balance sheets that are undervalued versus comparable high-quality companies. The company’s Sycamore Investment Franchise has a team of 16 including 12 investment professionals with average industry experience of approximately 17 years.
THB Asset Management
THB Asset Management (“THB”) manages equity assets in capacity constrained, micro-cap, small-cap, and mid-cap asset classes, including strategies managing the U.S., international and global portfolios. THB serves clients in the U.S. and in Europe and Australia. The company’s THB Investments Franchise includes eight investment professionals with an average industry experience of approximately 15 years.
Trivalent Investments
Trivalent Investments utilizes a disciplined approach to stock selection across large to small companies in the international and emerging markets space. Trivalent’s investment strategy is primarily a proprietary quantitative process that drives stock selection across various countries. Trivalent frequently conducts reviews of stock selection rankings within a portfolio construction and risk management context in order to isolate performance to stock selection. The company’s Trivalent Investment Franchise includes seven investment professionals with average industry experience of approximately 28 years.
Victory Income Investors
Victory Income Investors utilizes a rigorous process rooted in a team-oriented approach among portfolio managers, research analysts and traders. Their taxable and tax-exempt portfolios are built bond by bond using a fundamental, bottom up, credit and yield-focused analysis. The company’s Victory Income Investors Investment Franchise has a team of 40 including 30 investment professionals with an average industry experience of approximately 23 years.
WestEnd Advisors
WestEnd is a third-party ETF model strategist providing turnkey, core model allocation strategies serving as holistic solutions and complementary sources of alpha. The company’s WestEnd Investment Franchise has a team of 28 including seven investment professionals averaging approximately 14 years of industry experience.
Solutions Platform
The company’s Solutions Platform consists of multi-asset, multi-manager, quantitative, rules-based, factor-based, and customized portfolios. These strategies are designed to achieve specific return characteristics, with products that include values-based and thematic outcomes and exposures. The company offers its Solutions Platform through a variety of vehicles, including separate accounts, mutual funds, UMA accounts, and rules-based and active ETFs under the company’s VictoryShares ETF brand. Like the company’s Investment Franchises, its Solutions Platform is operationally integrated and supported by the company’s centralized distribution, marketing, and operational support functions. The Solutions Platform team of 14 includes 13 investment professionals with average industry experience of approximately 17 years.
Products and Investment Performance
As of December 31, 2024, the company’s 11 Franchises and Solutions Platform offered 124 investment strategies with the majority consisting of fixed income, the U.S. small- and mid-cap equities, global/non-U.S. equities, model portfolios and solutions.
Product Mix – The company’s investment strategies are offered through actively and passively managed mutual funds, rules-based and active ETFs, institutional separate accounts, VIPs, alternative investments, private closed end funds, and a 529 Education Savings Plan. Victory Capital’s strategies are sold directly to investors, as well as through third-party investment products, including mutual funds, third-party ETF model strategies, retail SMAs and UMAs through wrap account programs, CITs, and UCITS. The company’s product mix could expand, as it can add investment vehicles to strategies offered by the company’s Investment Franchises.
Investment Performance –The company’s Investment Franchises has established a long track record of benchmark-relative outperformance, including prior to their acquisition by it.
Integrated Distribution, Marketing and Operations
The centralization of the company’s distribution, marketing and operational functions is a key component in its model, allowing the company’s Franchises to focus on their core competencies of security and sector selection, portfolio construction, and client service. In addition, the company provides its Franchises with the benefits of operating at scale, providing them with access to a larger number of clients as well as a more streamlined cost structure. As of December 31, 2024, the company had 460 full-time employees with 158 in investment management, 191 in sales and marketing roles and 111 in management and support functions.
The company’s centralized distribution and marketing functions lead the sales effort for its institutional, retail intermediary, and direct investor channels. The company’s sales teams are staffed with accomplished professionals that are given specific training on how to position each of its strategies. The company’s distribution teams have historically focused on developing strategic long-term relationships with institutional consultants, institutional asset owners, retail and retirement intermediaries, RIAs, Family Offices, the Direct Channel, and bank trust departments. Complementing these relationships, the company uses data extensively to enhance the effectiveness of its distribution teams. Investments in data packs from intermediaries, artificial intelligence initiatives, and predictive analytics — used to determine specific financial advisors’ propensities to buy or sell products — further enhance efficiencies.
These relationships can enhance the company’s platform’s overall reach and allow its Franchises and Solutions Platform to access more clients. To ensure high levels of client service, the company’s sales teams liaise regularly with product specialists at its Franchises. The specialists are tasked with responding to institutional client and retail inquiries on product performance and educating prospective investors and retail partners in coordination with the relevant internal sales team members. The company’s distribution and marketing professionals collaborate closely with its Franchises’ product specialists to attract new clients while also servicing and generating additional sales from existing clients.
Direct Investor Business – In 2020, the company launched a digital platform to directly serve investors which features a client-centric modern design. Visitors to the site are presented with channel-specific content, useful investment tools and calculators, and timely investment insights from the company’s investment experts. At the company’s direct investor business contact center, it has approximately 75 sales and service professionals focused on assisting the company’s direct investors (the ‘Investors’). They engage with thousands of Investors every week via phone, chat or email depending on the Investor’s preference. The company also has a mobile application that streamlines service for Investors and enhances internal efficiency. Through these interactions the company provides Investors with account servicing, portfolio reviews, college planning assistance and investment guidance at no additional cost to the Investor. Many of the company’s direct investor business contact center professionals are Financial Industry Regulatory Authority (FINRA) licensed, so they are professionally qualified to serve the Investors’ investment needs.
Institutional Sales –The company’s institutional sales team attracts and builds relationships with institutional clients, a wide range of institutional consultants and mutual fund complexes and other organizations seeking sub-advisers. The company’s institutional clientele includes more than 400 corporations, public funds, non-profit organizations, Taft-Hartley plans, sub-advisory clients, international clients, sovereign wealth funds, and insurance companies. The company’s institutional sales and client-service professionals manage existing client relationships, serve consultants and prospects, and/or focus on specific segments. They have extensive experience and a comprehensive understanding of the company’s investment activities. The company’s client-facing institutional sales professionals have an average of more than 20 years of industry tenure, and they are supported by a separate team dedicated to handling requests for proposals, or RFPs, from prospective clients.
Retail Sales –The company’s retail sales team includes regional external wholesalers, retirement specialists, RIA specialists, national account specialists, and ETF sales specialists, all of whom are supported by an internal sales desk. The company also has a team of distribution professionals specializing in the sale of third-party ETF model strategies. Additionally, the company have a growing team focused on RIA, Bank Trust & Multi Family Offices with exceptional product knowledge to enhance the growth in this sub-channel within its retail sales. In the retail channel, the company focus on gathering assets through intermediaries, such as banks, broker-dealers, wirehouses, retirement platforms and RIA networks. The company offers mutual funds, ETFs, third-party ETF models, and separately managed wrap and unified managed accounts on intermediary and retirement platforms. The company has agreements with many of the largest platforms in its retail channel, which has provided an opportunity to place the company’s retail products on those platforms. Further, to enhances the company’s presence on large distribution platforms, it has focused the company’s efforts on servicing intermediary home offices and research departments. These efforts have led to strong growth in platform penetration, as measured by investment products on approved and recommended lists, as well as the company’s inclusion in model portfolios. This penetration provides the opportunity for the company to sell more products through distribution platforms. The company has several products on the research recommended/model portfolios of the top U.S. intermediary platforms. The company also has several products on the recommended list of the top retirement platforms.
Marketing –The company’s distribution efforts are supplemented by its marketing function, which is primarily responsible for enhancing the visibility and quality of the company’s portfolio of brands. They are specifically tasked with managing corporate, Franchise and Solutions Platform branding efforts, the development of marketing materials, the company’s website, digital marketplace, digital marketing, and social media efforts.
Operations –The company’s highly centralized operations functions provide its Franchises and Solutions Platform with the support they need so that they can focus on their investment processes. The company’s Investment Franchises share operating functions, such as trading platforms, risk and compliance, middle- and back-office support, technology, data and analytics, finance, human resources, accounting, and legal. Although the company’s operations are highly centralized, it allows its Franchises a degree of customization with respect to their desired investment support functions, which the company believes helps them maintain their unique investment processes and minimize disruptions.
The company outsources certain middle- and back-office activities, such as sub-transfer agent, trade settlement, portfolio analytics, custodian reconciliation, portfolio accounting, corporate action processing, performance calculation and client reporting, to scaled, recognized service providers, who provide their services to it on a variable-cost basis. Systems and processes are customized as necessary to supports the company’s investment processes and operations. The company maintains relationships with multiple vendors for most of its outsourced functions, which mitigates vendor-specific risk. The company also has cyber and information security, business continuity and data privacy programs in place to help mitigate risk.
Regulatory Environment and Compliance
Victory Capital Management (VCM) and WestEnd are both registered with the SEC as investment advisers under the Investment Advisers Act of 1940, as amended (the ‘Advisers Act’), and the Victory Funds, Victory Portfolios III, VictoryShares and several of the investment companies the company’s sub-advise are registered under the Investment Company Act of 1940, as amended (the ‘1940 Act’).
All the company’s soft dollar arrangements are intended the safe harbor provided by Section 28(e) of the Exchange Act. For the year ended December 31, 2024, 78% of the company’s total revenues were derived from its services to investment companies registered under the 1940 Act – i.e., mutual funds and ETFs.
Under the 1940 Act, a majority of the directors of the company’s registered funds must not be ‘interested persons’ with respect to it (sometimes referred to as the ‘independent director’ requirement) in order to rely on certain exemptive rules under the 1940 Act relevant to the operation of registered funds.
Victory Capital Services, Inc. (VCS) is subject to regulation by the SEC, Financial Industry Regulatory Authority (FINRA) and various states. In addition, certain of the company’s employees are registered with FINRA and such states and subject to SEC, state and FINRA regulation.
Victory Capital Transfer Agency, Inc. (VCTA) is a SEC-registered transfer agent. The company’s registered transfer agent is subject to the 1934 Act and the rules and regulations promulgated thereunder. These laws and regulations generally grant the SEC and other supervisory bodies broad administrative powers to address non-compliance with regulatory requirements.
The company is a fiduciary under Employee Retirement Income Security Act (ERISA) with respect to assets that it manages for benefit plan clients subject to ERISA.
In Singapore, the company is subject to, among others, the Securities and Futures Act (SFA), the Financial Advisers Act (FAA), and the subsidiary legislation promulgated pursuant to these acts, which are administered by the Monetary Authority of Singapore (MAS). The company and its employees conducting regulated activities specified in the Securities and Futures Act (SFA) and/or the Financial Advisers Act (FAA) are required to be licensed with the Monetary Authority of Singapore (MAS).
VCM is cleared by the Central Bank of Ireland, which regulates the company’s Irish business activities, to act as an investment manager to Irish UCITS funds.
History
Victory Capital Holdings, Inc. was founded in 2013. The company was incorporated in 2013.
