Business development corporations are unlikely to lose their momentum in the near term, despite last week’s interest rate cut by the Federal Reserve and the ongoing trade conflict with China. BDCs—the companies that invest in financially distressed small to medium-size private businesses—have yet to be affected by lower rates, which makes corporate bank ... READ MORE >
Financial Services
Comprising everything from private equity firms to family offices, financiers are active participants in the middle market. They provide the vital capital infusions needed to take growth companies to the next level.
Crowdfunding proves to widen the reach of companies seeking early-stage capital
In the past, companies looking for alternative funding would have tried their luck with venture capital and private equity firms. But the advent of crowdfunding—which offers Main Street investors the ability to make equity investments in growing businesses—has given some companies a boost they might not have gotten from using the typical sources. The ... READ MORE >
Latest C-corporation conversion announcement follows trend with largest alternative asset managers
Carlyle Group LP, among the world's largest private equity firms, is expected to announce it conversion to a C-corporation from a publicly trade partnership during its second-quarter earnings call on July 31. It is the latest alternative asset manager to make the conversion following peers that include Apollo Global Management LLC, Blackstone Group LP, Ares ... READ MORE >
SEC’s move to redefine high-net-worth investors may broaden investor base down the road
A new government proposal to loosen restrictions on who qualifies as high-net-worth individuals known as accredited investors could be a boon to asset managers seeking new sources of capital. The U.S. Securities and Exchange Commission issued a concept release on June 18 requesting public comment on several exemptions from registration under the ... READ MORE >
Managers fear heavy costs following SEC’s proposed fund-of-funds rule change
A proposed federal rule would expand the ability of investment funds to boost their portfolios in other funds. But critics say it would require significant fund restructuring by the funds and burden investors. Under the Investment Company Act of 1940, the new Securities and Exchange Commission rule is intended to enhance the regulatory framework applicable ... READ MORE >
Want a fuller picture of biotech’s promise? Look beyond the public markets
A recent Wall Street Journal article highlights the underperformance of the Nasdaq Biotech Index against other benchmarks. The article implies the weak returns are due to a lack of blockbuster biotech therapies; at the same time, the piece underscores the robust private funding activity within the biotech ecosystem. The ecosystem and the capital markets in ... READ MORE >
Data breaches are down but more effective
While the number of data breaches per year has doubled in the last decade, there were significantly fewer breaches in 2018 compared to 2017, according to the Identity Theft Resource Center, a nonprofit advocacy group for victims of cybercrime (see chart below). Unfortunately, cybercriminals have had greater success in accessing sensitive personal and ... READ MORE >
Health care deal outlook for 2019 good, despite slow start to year–panel
Health care deals are down to start 2019, but the outlook is good, largely due to of the amount of dry powder on the sidelines, a recent panel of private equity professionals noted earlier this month. The panel discussion, entitled “Financing the Deal,” was hosted by The Nashville Health Care Council, and featured representatives from four private equity ... READ MORE >
Innovation is now part of the insurance ratings mix
Innovation appears to have reached the risk-averse insurance industry. A few weeks ago A.M. Best issued a press release seeking comment on draft criteria for scoring and assessing innovation at the insurance companies it rates. “A.M. Best has captured innovation indirectly through the various building blocks of its rating process,” the company said, ... READ MORE >
Rising interest rates seen causing asset managers to recalibrate
Policymakers believe the economy is on a strong footing, but the pace of rate increases going forward remains uncertain, and the effects on asset management could be significant. The Federal Open Market Committee is set to meet on Dec. 19, and an interest rate increase of 25-basis-points appears to be 75 percent likely, according to Bloomberg analysts. ... READ MORE >