In our typical structured private equity transaction, we provide the capital needed to fund an opportunity and employ "hard money" principles to secure against our investment in the form of an unrelated asset that our partner is willing to subordinate in exchange for our partner retaining a larger equity upside in our investment.
Examples of Subordinated Asset
Advantages of Our Approach
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We offer superior principal economics, allowing the entrepreneur to accrue the majority of the upside in their highest conviction opportunities.
We have broad and robust experience with a wide range of alternative collateral assets that traditional lenders can't easily underwrite.
We are more flexible than debt. We are typically non-recourse, have no fixed maturity, and no prepayment penalties.
We do not seek to influence operations of our investments through voting, corporate oversight, board seats, covenants, or negative controls.
We are aligned with the entrepreneur in the objective of rapid principal repayment and carry cost by employing escalating cost incentives for early redemption.
We have no fixed horizon for investment outcomes.
Structured Private Equity
For our structured private equity portfolio, we seek to work with entrepreneurs, general partners, sponsors, and developers who have successfully built or accumulated assets with demonstrable, but illiquid, value and either (a) have opportunities to invest as principals in their own high conviction ideas but lack the liquidity to do so, or (b) seek to realize liquidity against illiquid assets.
Our agreements typically feature "convexity" by employing escalating cost incentives for early redemption by our partners.
In many circumstances, we invest alongside a partner who shares our investing philosophy and plays an active role in managing the investment. We favor self-liquidating investments and opportunities in which we have the ability to recapture principal rapidly while maintaining a participating in future value creation
Private or public company shares
Carried interest and/or management fees
Royalty, licensing, or contracted streams