Investors with Alto Securities can enjoy tailored access to the Alto Capital Private Credit Fund I, a diversified private credit portfolio managed by an established player in the alternative lending market1.
Percent has facilitated over 600 private credit deals totaling $1.1B with a ~2% loss rate since inception. The firm currently maintains an ~18% weighted average APY and sub 10-month average duration across its portfolio as of July 31, 2024.
Offering Details
Upcoming Webinar
About the Investment
Alto Capital Private Credit Fund I
The Alto Capital Private Credit Fund I offers diversified exposure to the multi-trillion dollar private credit market, focusing on higher yields through shorter-duration investments and strategic risk management across various asset classes and geographies. The fund seeks to target investments that are generally less correlated with the stock market, with the goal of contributing to portfolio diversification and potentially mitigating inflation risk for accredited investors.
Key investment areas include:
Leveraging Percent's track record of $1.13 billion facilitated across 622 deals since 2018, the fund targets attractive risk-adjusted returns, reflected in the platform's 18.07% current weighted average APY and 13.90% historical weighted average APY on matured deals2.
Past performance is not indicative of future results.
About Percent
Founded with the mission of modernizing private credit markets that have historically been relatively limited to institutional investors, Percent connects borrowers, underwriters, and investors on a digital platform designed to streamline debt capital raising and investing for issuers and accredited investors alike. Percent eliminates process inefficiencies, delivers transparency and standardization with comprehensive data analysis, and offers a diverse range of higher yield, short duration, securitized debt investments.
Meet the team
Nelson Chu, Founder & CEO
Nelson Chu is an experienced serial entrepreneur and the Founder and CEO of Percent, the modern credit marketplace. Percent is an end-to-end credit platform unlike any other, empowering borrowers, underwriters, and investors to transact with confidence through governance, asset transparency, and market standardization.
Prior to Percent, Nelson founded a strategy consulting firm helping companies build products and raise capital for growth, creating over $1B in equity value. Nelson's commitments extend to angel investing and philanthropy as well, supporting various startups and charitable organizations. He graduated from Rutgers University with a Bachelor of Arts degree in Economics and Political Science.
Management Team
To date, Percent has raised $50M in funding from notable investors including:
Performance
Private credit: originations in lending gaps
Private credit has evolved from a niche financing source to a crucial component of the modern investing landscape, experiencing high growth over the past decade. This expansion is driven by several key factors driving economic investment activity.
A growing sector
The private credit market has grown to $2.1 trillion globally in 20233, with projections suggesting growth to $3.5 trillion by 20284. Major financial institutions like Goldman Sachs, Citi, and Wells Fargo have taken notice, collectively raising over $50 billion to deploy in this burgeoning market5.
Pension funds and insurance firms have increased their allocations to private credit too, from about $200 billion in 2016 to nearly $600 billion today6.
The 2024 Global Financial Stability Report (Figure 2.2, panel 1) shows that historically certain segments of private credit may have outperformed other assets such as private equity, natural resources, S&P 500, venture capital, real estate, and MSCI World TR7 since the turn of the millennium.
As banks retreat from certain lending markets, private credit has become increasingly attractive to investors, especially on Wall Street8, due to its higher-yield opportunities in low-interest environments and customized financing solutions. Comparisons are based on historical data and should not be construed as predictive of future performance. Traditional markets also tend to be more liquid, so investors should conduct their own due diligence prior to investing.
Potential benefits of private credit
Upcoming Webinar
Citations
- Percent.com
- Percent: Track Record
- IMF, 2024
- Fortune, 2024
- Banks Pump Billions More Into Private Credit as Frenzy Grows
- Global Financial Stability Report, April 2024, Chapter 2: “The Rise and Risks of Private Credit,” April 16, 2024 Figure 2.12, panel 2
- Global Financial Stability Report, April 2024, Chapter 2: “The Rise and Risks of Private Credit,” April 16, 2024
- Bloomberg, 2023
Key Risks
- Loss of Principal: Investments in private credit carry a significant risk of loss, including the potential loss of your entire investment.
- Illiquidity: Private credit investments are typically illiquid, meaning they cannot be easily sold or exchanged for cash. Investors should be prepared to hold their investments for an extended period.
- Default Risk: Borrowers may fail to make interest payments or repay principal, leading to defaults that can negatively impact returns.
- Limited Operating History: The fund and its underlying assets may have limited or no operating history, which can increase the uncertainty of achieving investment objectives.
- Leverage Risk: The use of leverage can magnify both gains and losses, potentially leading to increased volatility and risk of loss.
- Interest Rate Risk: Changes in interest rates may affect the value of the underlying assets and the returns generated by the fund.
- Concentration Risk: The fund may focus on a limited number of assets or sectors, which can lead to higher volatility and risk if these concentrated investments underperform.
- Market Risk: Although the fund seeks investments less correlated with public markets, external economic factors and market conditions can still adversely affect performance.
- Regulatory Risk: Changes in laws or regulations could impact the fund's operations and investment strategy, potentially leading to decreased returns.
- Management Risk: The success of the fund depends on the expertise and decisions of its management team, and poor management decisions could negatively impact performance.
