Providing creative capital solutions outside of the traditional credit market
ABOUT US
In today's market environment, investors are increasingly facing challenges related to decelerating global growth, macroeconomic risks and duration risks. We believe there is an attractive range of opportunities in the non-traditional credit market that can counter these challenges and markedly improve the risk-adjusted profile
OUR APPROACH
Our industry agnostic strategy targets short-term opportunistic credit to businesses in the lower middle market:
• Loan sizes ranging 1-5m, with the average being 2-3m.
• Event-driven, situational bridge financing with a quick close offers an opportunity for high yield and low price sensitivity from merchants.
• A network of syndicate partners target proprietary deal flow with a track record of high risk-adjusted returns and low defaults
• A thorough underwriting process, a strategic focus on fully amortizing credit, and outlaying a relatively modest amount of capital when compared to the enterprise’s revenue, creates an environment that enhances IRR while also decreasing risk.
• These strategies require specialized "process-driven" expertise to maximize outcomes and minimize risk, including getting as senior as possible in the capital stack with UCC-1 liens, personal guarantees, stock pledges, cross-collateralization, and other forms of credit enhancement.
WHY OPPORTUNISTIC CREDIT?
Opportunistic credit strategies can create value through a myriad of attributes:
• Both secular and structural changes can drive opportunities
• Ability to invest across strategies and geographies within the US
• "Complexity premium" that is inherent in many opportunistic credit investments
• Many require customized, bespoke structuring, with fewer competitors and less crowded positioning
• Low to modest interest rate sensitivity
• Typically focus on absolute returns that are capital structure agnostic
• Low to modest market beta to both credit and equity indices through geographic and strategy diversification, along with a focus on strategies that focus on idiosyncratic situations