Pier Asset Management reposted this
What do you do? We invest in small dollar loans (<$250k) and contractual cash flows. Examples: small business, consumer loans, bridge real estate, music royalties advances, litigation finance, etc. We invest in a few ways: 1. Buy pools of loans (mostly in the secondary market) 2. Asset based lending to fintech + alt lenders (seasoning, warehouse) 3. Other niche opportunistic deals Buying secondary pools comments: Sellers are other funds, banks, family offices, securitization vehicles, etc. We act as a liquidity provider. If someone needs to sell for a reason, we can help. Usually short duration runoff pools. Buy at a discount, but target fair yields. ABS examples and comments: Loans are put into an SPV. Senior lien to SPV. Variety of portfolio covenants. Draw facility, non-revolving. Origination fee and interest rate. No draw fees. No warrants. No unused line fees. Core to our strategy: - Small (<$15MM) deal size - We focus on short duration (eg. no 30-yr mortgages) - Network is critical. Deals almost always sourced through network, not brokers This is a niche strategy in a niche asset class. Strategy not big enough for everyone, unfortunately.