We like to tell stories about alternative investments and Fintech as our sector continues to expand. Click below to read our insights on our rapidly changing space. If you have any questions, click here.


June 16th, 2021

Market Views

No, not the band, although we could all probably use a dose of Rock n Roll All Night these days.  K.I.S.S. is an acronym, slightly hokey in that Forrest Gump kind of way. Yet its banality hides a very powerful message: Keep It Simple Stupid.  Many of us, and especially those who suffer the curse of knowledge, are predisposed to complicate explanations. A gentle KISS reels us back in and reminds us that high impact communication is rooted in simplicity.

Digital private credit is, at its core, a simple asset class to understand.  Terms like digital and Fintech may lead investors to believe it is a niche area but let us put those aside.  The asset class is in essence all about investing in loans and similar fixed income obligations.  A promissory note between a borrower and a credit provider is originated, whereby that note stipulates key terms like borrowed amount, rate, and term.   This concept is nothing new; these contractual cash flows are structured in a similar manner to familiar loans, like mortgages, credit cards, or auto loans.  The small balance feature of digital private credit allows investors to purchase lots of these fixed income assets.

The digital piece is introduced into the equation because technology has made several elements of the origination process more efficient.  For example, credit sourcing and underwriting are done online, through websites and rule-based algorithms.  These lead to better credit journeys for borrowers: more efficiency and transparency in a clear and democratic loan origination process.  As for investors, the journey has also become more efficient and rewarding.  The investor has access to fixed income assets that were not accessible, especially not in size. Transparency provides the investor with an ability to understand, often daily, the activity tied to each credit line item in a portfolio.  Simple and effective.

Confidentiality and Non-solicitation: No information herein constitutes an offer or a solicitation to buy or sell any securities or any interests in any product or investment strategy managed by HCG Fund Management LP (“HCG”).  Any offer or solicitation relating to any such investment will be made only by means of confidential offering documents relating to a particular fund  or investment contract and only in those jurisdictions where permitted by law.
Reliance: This information may not be relied upon for investment decision-making purposes. It does not contain all the information necessary to make an investment decision, including the risks, fees, and investment strategies of investment products advised by HCG. Eligible investors are described in official offering documents, all of which must be read in their entirety and will supersede the information contained herein.  No offer to purchase any securities or interests by a prospective investor will be made prior to receipt of all official documents, and no offer to purchase any securities or interests will be accepted without receipt of all official documentation that has been completed to HCG’s satisfaction.
Opinions — No obligation to update:  The information contained herein represents the views and opinions of HCG.  It is intended solely for informational purposes and is not intended to constitute investment, legal, tax or accounting advice.  The views about digital finance investing and estimated future investment opportunities expressed herein reflect those of HCG management as of the date herein and are a reflection of our best judgment at the time.  They are subject to change based on market and other conditions, and we have no obligation to update.  Actual results, however, may prove to be different from our expectations.  No warranty is given to the completeness or the accuracy of the information contained herein.
Suitability and Risks:  Any investment in products managed by HCG is appropriate only for financially sophisticated investors capable of analyzing and assessing the associated risks fully disclosed in the Private Placement and/or Information Memoranda. Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The Private Placement and/or Information Memoranda contain this and other information about the investment. A prospective investor should have no need for liquidity with respect to its investment and should view it as long-term and not a trading vehicle.  Additional risks are disclosed in the Private Placement and/or Information Memorandum including, including, limited liquidity and restrictions on transfer of the securities, dependence on HCG’s principals, and short operating history of certain productsAs with all private investment funds, investments are deemed speculative and involve risk of loss.
Third Party Data: We do not verify third party data used in certain calculated metrics shown here.