A Masterclass in Asset Based Finance Part II of III. Raising Debt Capital for your Specialty Finance, Fintech Lending, or Alternative Lending Platform with Special Guest and Asset Backed Podcast Contributor Matt Edgar, Founder & CEO of Edgar Matthews

Asset Backed

A Masterclass in Asset Based Finance Part II of III. Raising Debt Capital for your Specialty Finance, Fintech Lending, or Alternative Lending Platform with Special Guest and Asset Backed Podcast Contributor Matt Edgar, Founder & CEO of Edgar Matthews

Matt Edgar, Founder & CEO of boutique investment bank Edgar Mathews, and I are recording a three episode Masterclass in Asset Based Finance. This is episode II of III. In recent months specialty finance, asset based finance, and different related credit themes have gotten significant attention in the press and from market participants. Together Matt and I dive into the process of how a growing lending business raises debt financing. This content will be particularly beneficial we believe for startup, emerging, growth-stage and middle-market sized originators and lending businesses who are seeking to raise debt facilities from institutional capital providers. I hope you enjoy and join us on each of these special episodes.

The topics in Part II of III include:

1. The main structures through which a specialty finance originator can access capital
2. The different types of investors (or providers of debt capital) that can be approached. Considerations for each cohort of investor.
3. Key structural features of ABL facilities

• Borrowing Base / Advance Rate (also covered previously)
• Eligibility Criteria
• Excess Concentrations
• Minimum Utilization & Accordions
• Financial Covenants
• Collateral Quality Tests & Triggers
• Events of Default

4. The closing and funding process of asset-based financing facilities

The topics in Part III of III will include (this episode will be released very soon):

1. Biggest mistakes to avoid in the debt capital raising process
2. Biggest struggles for originators when working with investors
3. Advisors and specialists you may want to engage when executing an asset-based financing

4. Key considerations as specialty finance originators evolve and grow and want to tap into the bank, securitization or broader capital markets

5. The current cost of capital and market terms and how this differs by stage and investor type

6. The growth and evolution of private asset-based finance and what we may see over the next 12-18 months

The topics we covered in Part I of III included:

1. Intro: Firm overview, background, etc.
2. A broad overview of the capital raising process and how Edgar Matthews works with originators/lenders seeking to raise debt financing
   1. The process for each issuer/lender will differ quite a bit depending on the vertical, stage of the company, collateral, debt solution required, etc. We focus on private ABL facilities more than securitizations in Part I.
3. Preparing for the capital raising process
4. Key structural features of warehouse and ABL facilities
5. Best practices for moving from term sheet to closed transaction