Fund Objective:
The Next Edge Private Debt Fund (the “Fund”) aims to achieve consistent, risk-adjusted returns with minimal volatility and low correlation to most traditional asset classes by investing primarily in a diversified portfolio of trade finance, factoring and secured loan investments.
Investment Strategy:
To achieve its investment objective the Fund will allocate capital to a select number of loan originators and credit advisors who are recognized leaders in the North American direct lending marketplace.
The Credit Advisor:
The Fund’s primary Credit Advisor is LINE Financial Services (“LINE Financial”). Formed in 1999 as its predecessor firm Liquid Capital Corporation, LINE Financial is a trade finance company focused on factoring and secured asset-based lending (“ABL”). LINE Financial has been operating in the factoring and trade finance space since 1999 (previously as Liquid Capital Corp.) processing over $3 billion* in transactions through both its Canadian and US headquarters (in Toronto and Dallas respectively).
*Source: Liquid Capital, as of December 31, 2018
Next Edge Private Debt Fund is Focused on
These Areas of Private Lending:
- Accounts receivable financing, commonly referred to as factoring, is an essential component of trade finance and has existed in developed economies for centuries.
- Simply stated, factoring allows a company to improve its cash flow cycle through the sale of its accounts receivables to an outside party (the factor).
- By converting accounts receivable into cash, a company increases both its productivity and financial health.
- From an investor standpoint there is an inefficiency that can be received from the attractive yields charged to the client based on their often poor business credit; however, much security can be had from the end debtor (receivable).
- Lending to businesses secured by an asset that acts as collateral for the loan.
- These loans tend to be secured by receivables, inventory, real estate or equipment.
- Attractive yields are available and are secured by real assets.
- Loans provided to non-bank lenders whereby the primary collateral/assets are the pool of loans.
- These non-bank lenders provide consumer or business loans in a variety of areas ie. auto finance, POS retail consumer finance.
- This area has been vastly growing due to technology driving efficiency & changing consumer behavior