Gavin Solsky

Global Credit Investments (GCI), a specialist private credit fund manager, announces the expansion and rebranding of its successful SME Mortgage Fund into the GCI Real Estate Credit Fund, an open-ended investment fund. This expansion aims to better address the growing borrower demand for tailored financing solutions by offering enhanced flexibility, term, size and speed in response to current market and borrower needs.

In recent years, GCI has deployed circa $400m into real estate credit facilities across a diverse range of asset types, delivering excellent outcomes for borrowers and investors alike. This solid track record has set the stage for an expansion of the strategy and to transition GCI’s expertise to an open-ended fund model, allowing for an increase in direct loan originations with a streamlined funding process.

Gavin Solsky, Co-founder and Managing Director of GCI highlighted the strategic imperative behind the Fund’s evolution: “Our prior transactions have laid a strong foundation with consistent performance and reliable returns. Current macroeconomic trends and the evolving dynamics between borrowers and lenders make this an ideal time to transition to an open-ended fund structure. The GCI Real Estate Credit Fund is designed to provide a customised funding solution which meets borrowers’ needs more effectively.”

“Higher interest rates and tighter lending conditions have put pressure on some borrowers, creating a demand for alternative, innovative financing solutions. Traditional lenders are becoming more cautious, especially with new borrowers. Our Real Estate Credit Fund is designed to address this gap, with a particular focus on $5-30m loans that offer flexible and transformative financing solutions tailored to meet borrowers’ needs,” said Solsky.

Commenting on the significant advantages of the open-ended fund structure for borrowers, Solsky said: “Borrowers today are seeking more than just capital – they’re looking for agility and flexibility that can adapt to their evolving needs. Our open-ended fund structure will look to support real estate borrowers in a similar vein to GCI’s Asset Backed Fund vehicle which has deployed in excess of $750m since 2020.”

“Our decision to enhance our Real Estate Credit offering reflects our commitment to meeting borrower demands head-on. By consolidating our real estate lending activities into an open-ended fund structure, we can better capitalise on high-potential opportunities, offering borrowers unmatched flexibility in terms, speed of execution, and the ability to adjust financing terms mid-course,” continued Solsky.

“This approach not only enhances our ability to originate and execute strong risk-return opportunities for our family office and high net worth investors but also reinforces our position as a responsive and reliable capital partner in the real estate credit market,” said Solsky.

The post GCI enhances real estate credit offering with expanded open-ended fund appeared first on AdviserVoice.

The company’s Real Estate offering, which launched in October last year under the guidance of Managing Director David Stone, specialises in delivering flexible credit solutions to business owners, property investors and property developers. As Investment Director, Robert will play a key role in spearheading risk analysis, overseeing deal execution, and driving growth and uptake of the Real Estate strategy.

David Stone welcomed the addition of Robert to the team as a reflection of the platform’s significant growth potential.

“Robert has deep experience in the mid-market property sector, having executed nearly $1 billion in transactions with no capital losses, making him a natural and strategic fit for the team.

“Our real estate proposition requires unique perspectives to craft solutions for clients that typically fall outside traditional banking criteria. With over eight years in financial services and property finance, Robert brings an extensive skillset and a shared value in helping clients achieve transformative business outcomes,” Stone added.

GCI’s Real Estate team specialises in leveraging high-quality Australian real estate assets to deliver flexible credit solutions, with a core focus on facilitating 6–24-month bridge loans that do not involve construction. This includes refinancing, property and business acquisitions, development approvals, bridging finance and equity releases.

Gavin Solsky, GCI Managing Director and Co-Founder, reinforced the importance of building the Real Estate team as part of GCI’s overarching transformational credit offering.

“We are continuing to see a demand for creative lending solutions as traditional lenders scale back and borrowers face increased restrictions. Our offering is distinctive in that our team works closely with borrowers through every step of the transaction to craft a bespoke solution to meet their requirements”.

Commenting on his appointment, Mr. Grajczyk said, “I am thrilled to join David and the team in continuing to build this capability and help borrowers realise their real estate vision.”

The post GCI bolsters newly launched real estate team with strategic appointment appeared first on AdviserVoice.

The incoming investor, Global Credit Investments (GCI), is a leading provider of specialist private credit and tailor-made financial products. Founded in Sydney in 2015, GCI provides flexible low-dilution funding structures that enable its investee companies to transform their businesses, funds have been used by businesses to help accelerate sales and marketing and to fund international expansion strategies – to name a few. GCI has raised and deployed c.AU$1 billion to date and specialises in empowering outstanding entrepreneurs and management teams looking to transform and scale their high growth businesses.

LAB Group was co-founded in 2010 by CEO Nick Boudrie and CTO Lyndon Webster, who retain majority stakes in the business. Since launch, LAB Group has deployed its technology across Australian and international financial services licensees, as well as businesses in other sectors, whilst establishing offices in Melbourne, Sydney, Brisbane and Copenhagen.

Having partnered with some of Australia and the world’s most recognised and respected institutions, LAB Group’s innovative onboarding and compliance platform solves the key governance, risk and compliance challenges that regulated entities face today. GCI’s investment will support LAB Group to accelerate its business and product development activities, providing working capital to fund domestic and international growth opportunities.

Nick Boudrie, CEO and co-founder of LAB Group, said: “We are delighted to welcome GCI as an investor in LAB Group. The backing of an investor of GCI’s calibre will bring LAB Group the support we need to further strengthen and scale up our team and accelerate our growth strategy. We are particularly pleased to have found a capital investment solution which will help us take our business to its next growth phase while minimising shareholder dilution.

“Completing the GCI facility underlines the strong market position and unique capabilities that LAB Group has developed through 12 years of evolution and innovation. Our platform delivers significant advantages to LAB Group clients, encompassing a dynamic onboarding framework providing end-to-end account opening and digital workflow management, an easy-to-integrate ID verification solution validating AML, KYC, KYB, and PEP Sanctions for all entity types, and a network of global products and jurisdictions that enables the seamless consented movement of consumer profile data.

“We look forward to a fruitful working relationship with GCI which adds value to LAB Group’s customers, integration partners, staff and investors.”

Gavin Solsky, Managing Director & Co-Founder, from GCI, said: “We are excited to announce our partnership with LAB Group as they embark on their exciting growth journey. LAB Group embodies all the qualities we seek in an emerging high-growth company, from a proven product-market fit to outstanding customer metrics. With a skilled founder-management team driving their growth strategy and a substantial market opportunity supported by structural growth, we are confident in their future success.”

Henslow Pty Ltd acted as corporate adviser to LAB Group and lead manager of the transaction.

The post LAB Group secures new debt facility to fund growth strategy appeared first on AdviserVoice.

In a new research report, Evergreen Ratings has given a ‘Commended’ rating to Global Credit Investments’ Commercial Finance Fund, which invests in this sector providing senior commercial debt facilities secured by physical and financial assets.

Evergreen Ratings Founder and CEO Angela Ashton says that in recent years, with APRA-regulated authorised deposit-taking institutions (ADIs) facing more onerous macro-prudential guidelines, the domestic market has seen more borrowers seeking funds outside traditional banking sources.

For non-ADIs, such as Global Credit Investments (GCI), there has been an increasing flow of potential lending opportunities, as well as the ability to be more selective about which loans to proceed with.

“The market dynamics are supportive of attractive risk-adjusted loan pricing which presents an opportunity for a capital provider to earn excess returns,” Ashton says.

At the same time, investors seeking yield are finding fewer attractive opportunities. “Interest rates are at historical lows and stock dividends fell last year due to the effects of COVID-19,” Ashton says.

“This leads to a situation where people are struggling to find good sources of consistent yield. Private credit is an asset class that can help to fill that portfolio need and we are seeing more and more of these types of funds approach us for consideration. However, these funds are not all the same. There are important nuances in lending practices and the types of borrowers each manager targets. It’s important to understand the risk each fund is taking and to ensure you are being properly rewarded for that.”

GCI was co-founded in 2015 by Steven Sher and Gavin Solsky. Steven spent 17 years in senior investment and executive roles at Goldman Sachs, and Gavin founded the professional services and outsourcing firm Portland Group.

Steven Sher says: “We’re proud to be awarded the ‘Commended’ rating for the GCI Commercial Finance Fund from Evergreen Ratings.

“Since its inception, our Commercial Finance Fund has outperformed investor expectations and provided them with exposure to private credit markets that are typically difficult to access. The preservation of our investor’s capital and managing downside risk is at the core of all GCI investments.

“We’re delighted to have simultaneously partnered with and funded our borrower clients’ growth,” says Sher.

The fund targets a return of around 8.5 per cent a year, net of fees. It invests in the smaller end of the private debt market, with loans ranging from $5 million to $30 million.

The fund was launched in July last year, when two established GCI funds were merged. It has returned 9.3 per cent on an annualised basis since then and it has not recorded any loan defaults.

Evergreen considers that the GCI Commercial Finance Fund is well positioned to capitalise on private debt premia.

Ashton says: “Private debt can be an attractive asset class due to private debt premia. It is also one of the few asset classes where the skillset of the manager can actually demonstrate the ability to preserve investor capital.”

She adds: “Evergreen looks for private debt premia from several sources, including:

• illiquidity premium, which is the compensation required for not being able to trade the debt security on an exchange;
• complexity premium, which is the compensation required for analysing deals in the private market and structuring appropriate risk mitigation; and
• supply/demand premium, which comes from playing in the lower end of the market where there is less competition.

“We do not believe the fundamentals of this market in Australia will deteriorate over the foreseeable future,” Ashton says.

Ashton says the GCI fund incorporates a number of risk protections. These include taking senior security over all assets of the borrower, the establishment of a special purpose vehicle to house all collateral and a requirement that the borrower provide a first loss provision.

“The fund is underpinned by a very strong investment philosophy and the track record to date. Combined with GCI’s investment processes, this augurs well for future performance.”

The post Private debt continues to offer attractive risk-adjusted returns appeared first on AdviserVoice.

Gavin Solsky

Specialist fixed income asset manager, Global Credit Investments (GCI) says Australian retail investor portfolios weighted heavily towards cash and domestic equities have foregone significant, stable income benefits of alternative, prime-grade consumer credit markets.

“The continuation of poor yields from historically low global cash rates and volatile listed company dividends has applied ongoing pressure on Australian investors and their advisers to find reliable income within robust risk and capital focus parameters,” says GCI co-founder Gavin Solsky.

GCI’s recently launched Diversified Income Fund has garnered strong and growing investor interest with its investment target of high, single-digit income and institutional grade investment process, purpose-built to preserve investor capital through proprietary data analysis, active investment selection and asset diversification.

The Fund is Australia’s first pooled investment vehicle targeting predictable income returns from prime credit, sourced via global Marketplace Lending (MPL). It invests in FICO-rated*, short-term consumer credit, with zero leverage.

GCI co-founder and Chairman Steven Sher said consumer credit originated by MPL platforms has provided stable returns with lower volatility, compared with government and corporate bonds, US stocks and Australian domestic equities.

“Over the eight years between January 2008 and March 2016, our analysis shows the asset class delivered an annualised return of 6.04 per cent, which compares favourably to 7.26 per cent from US stocks (S&P 500 Total Return Index) and significantly more than comparable Investment Grade and High Yield Corporate debt.

“However, were you invested in the S&P 500 over that time, it would have been a volatile ride, experiencing in total 38 months’ of negative return. By contrast, consumer credit originated via MPL platforms had zero monthly negative returns, and also produced a cumulative gain of over 60 per cent for the same 8-year period,” Mr Sher said.

The GCI Diversified Income Fund is open to sophisticated (high net worth) and institutional investors and targets a high single digit pre-tax return to investors after fees, denominated in US dollars.

———-

*The FICO score is a broad-based risk measure for consumer credit, originated in the United States. This proprietary score underpins a majority (90%) of US consumer lending decisions.

The post Low cash rate drives high demand for alternative investable asset class appeared first on AdviserVoice.

Gavin Solsky

Australia’s first pooled investment vehicle targeting high income returns from prime credit sourced via global Marketplace Lending (MPL) has opened to high net worth and institutional investors.

Global Credit Investments’ (GCI) Diversified Income Fund (the Fund) invests in prime short-term consumer and small business credit.

GCI co-founder and Chairman Steven Sher said the Fund was conceived after searching for alternative investable assets that are highly diversified, deliver stable income, are uncorrelated to major asset classes and would remain resilient during periods of market stress.

“Consumer and small business credit has historically been the exclusive domain of banks and financial institutions.
“However, emerging technologies are disrupting traditional banking markets, allowing GCI to now access what we believe is among the best risk/return credit opportunities available to fixed income investors,” Mr Sher said.

A May 2015 Morgan Stanley research paper “Global Marketplace Lending: Disruptive Innovation in Financials” estimated that credit issuance via global Marketplace Lending would reach between US$290 Billion to upwards of US$490 Billion by the year 2020.

The Australian market for addressable consumer and SME lenders would also grow to an estimated AUD$19 Billion by 2020, the Morgan Stanley paper said.

“The speed and magnitude of disintermediation allows us to now ‘cherry-pick’ prime assets from online marketplace originators.  These assets used to sit directly on a bank’s balance sheet and were previously inaccessible to non- bank investors. Investors in the GCI fund can now access a high return by buying these assets without the additional risk of leverage,” Mr Sher said.

GCI co-founder and Executive Director Gavin Solsky said GCI has made significant investments in quality people, processes and technology in order to research and access prime quality credit from the Australian and global marketplace, in particular the USA.

The firm has developed sophisticated proprietary technology and secured access, initially, to leading US-based Marketplace platforms, Lending Club and Prosper, which together account for over 60 per cent market share (source: Morgan Stanley) of the US Marketplace Lending sector. This gives the GCI Fund the additional benefit of allowing investors to diversify into US dollars, while still attaining a strong yield.

“We have brought together a globally credentialed team, with a complementary mix of investment and management skills. The team has its own capital invested alongside our investors.

“This is a very exciting time as financial technology and new lending models combine to address a massive global market.

“The trend translates into simple, attractive investment outcomes for ourselves and our investors: having our own capital invested in highly distributed, unleveraged, short-term credit with monthly principal and interest payback terms makes a lot of sense,” Mr Solsky said.

“Regular payback terms effectively ‘de-risk’ our credit exposure to any single loan, unlike traditional longer term fixed income assets (bonds) which are not only exposed to interest rate risk, but investors only receive a bullet payment at the end of the investment term,” he said.

The GCI Diversified Income Fund is open to sophisticated (high net worth) and institutional investors and targets a high single digit pre-tax return to investors after fees, denominated in US dollars.

The post Prime credit markets open to Australian investors appeared first on AdviserVoice.

Australia is OnDeck’s first market outside North America. In expanding to Australia, OnDeck has partnered with MYOB – Australia’s leading business accounting software provider – and a group of prominent Australian technology investors including Andrew Bassat and Jason Lenga (Seek), Gavin Solsky (Healthshare) and Cameron Poolman (Graysonline). Mr. Poolman will be CEO of OnDeck’s Australian business.

As part of the arrangements, MYOB will provide valuable local expertise and make the OnDeck solution available to its approximately one million business users across Australia.

OnDeck is a technology-enabled small business lender that can evaluate, approve and fund small business loans as fast as the same day. Headquartered in New York City, the company has originated more than $2 billion (USD) in loans to small businesses in more than 700 industries across all 50 U.S. states and Canada.

OnDeck uses advanced lending technology and analytics to assess creditworthiness based on actual operating performance and not solely on the owner’s personal credit. OnDeck’s proprietary small business credit scoring system, the OnDeck Score®, utilises more than 100 external data sources and 2,000 data points per loan application and leverages a database of more than 10 million small businesses.

OnDeck CEO Noah Breslow said, “Australia represents an exciting growth opportunity. Similar to the U.S. market, in Australia we see a huge gap between small business financing needs and the availability of capital from traditional sources. There is significant unmet small business lending demand in Australia, and we believe our online platform is well suited to address the capital needs of Australian small businesses.”

The OnDeck solution aims to answer a key challenge facing Australian small businesses: the ability to access working capital quickly and easily.

“U.S. small business owners have embraced the OnDeck model. We think OnDeck will prove to be the game-changer Australia needs to give its hard working small business community a resource to help owners reach their full business potential,” Mr. Poolman said.

MYOB CEO Tim Reed said, “We have closely followed OnDeck’s success in the U.S. and are excited to bring their financing solutions not only to our customers but to the entire small business market in Australia. Our partnership with OnDeck is the latest step in our ongoing journey to making business life easier. Building on our successful cloud based solutions, and partnering directly with other pioneering organisations such as OnDeck, we will ensure tight integration with MYOB products such that we offer a truly connected service. This is all underpinned by significant and successful R&D investments in cloud based platforms.”

The post Leading US small business lender OnDeck expands into Australia appeared first on AdviserVoice.