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Adams Street P… - Tue, 04/23/2024 - 00:35

In Private Credit Manager Selection, the Devil is in the Diligence

Key Takeaways

  • As private credit popularity rises, investors must be even more discerning. Alpha in private credit derives from loss avoidance, not upside potential
  • Benign economic and credit conditions over the last decade have allowed many managers to avoid losses, leading to a narrow return dispersion
  • The benign climate has changed with higher rates, wider credit spreads and slowing revenue growth, all of which is likely to put pressure on many managers’ portfolios
  • Look for private credit managers with three key characteristics to avoid losses and produce alpha – a proven approach to underwriting, a differentiated approach to originating and winning deals, and a capital base that matches their opportunity set

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This information is not investment advice or an offer or sale of any security or investment product or investment advice. Offerings are made only pursuant to a private offering memorandum containing important information. Statements are made as of the date of this release, and there is no implication that the information contained herein is correct as of any time subsequent to such date. References herein to specific sectors, strategies, or investments are not to be considered a recommendation or solicitation for any such sector, strategy, or investment. Past performance is not a guarantee of future results. Projections or forward-looking statements contained in the Paper are only estimates and there can be no assurance that the results set forth in the projections or the events predicted will be attained, and actual results may be significantly different from the projections. Also, general economic factors, which are not predictable, can have a material impact on the reliability of projections or forward-looking statements.  Adams Street Partners, LLC is a US investment adviser governed by applicable US laws, which differ from laws in other jurisdictions.

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Adams Street Partners

Adams Street Partners is a global private markets investment manager with investments in more than 30 countries across five continents. The firm is 100% employee-owned and manages $58 billion in assets across primary, secondary, growth equity, private credit, and co-investment strategies. Adams Street draws on over 50 years of private markets experience, proprietary intelligence, and trusted relationships to generate actionable investment insights across market cycles. We have a long history of managing complex insurance assets to deliver tailored alternative solutions to insurance company clients. Flexible portfolio construction helps to meet the evolving needs of insurance companies globally with the goal of achieving attractive risk adjusted returns. Adams Street has offices in Austin, Beijing, Boston, Chicago, London, Menlo Park, Munich, New York, Seoul, Singapore, Sydney, and Tokyo.

Neelm Hameer
Vice President, Investor Relations
nhameer@adamsstreetpartners.com
+1 773 720 9748

Adams Street Partners, LLC
One North Wacker Drive, Suite 2700
Chicago IL 60606-2823

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