Why Invest in Specialty Finance?

Following the 2008 Global Financial Crisis, Banks and larger Financial institutions were forced, by a combination of market conditions and increased regulations, to significantly tighten their lending standards. This financial conservatism has essentially closed off the traditional credit market to smaller companies, and has opened the door to specialty finance firms to play a larger role in providing structured finance options.

Specialty finance can be broadly defined as any financing activity that takes place outside the traditional banking system. Typically, specialty finance firms are non-bank lenders that make loans to   consumers and small to midsize businesses that may otherwise find it difficult to obtain financing. Peer to peer lending also falls into this category

Unlike banks, specialty finance firms tend to rely on their own due diligence of the opportunity rather than ensuring that a borrower fits into the traditionally defined “credit box”, upon which many larger financial institutions operate.

It is imperative to work with an experienced and diligent originator or fund manager to ensure the potential risks for these opportunities are appropriately explained, discussed and managed.

Historically, these deals have generally been reserved for hedge funds, institutional investors and family offices. With the emergence of new technology platforms, accredited investors may also invest in these specialty finance opportunities. Typically, specialty finance presents a valuable opportunity for beginner investors and finance professionals to diversify and protect their portfolios from downturns, whilst earning high yields.

Dovera Capital (“Dovera”) do not provide Financial Services, they provide a private capital marketplace by which it may introduce potential accredited investors to asset-based Investee Entities. Any securities or participation interests which are issued or sold, as a result of such introduction, will be issued by the Investee Entity or by another person affiliated with the Investee Entity (for example a current shareholder/founder of the Investee Entity). Dovera is not engaged in a business of providing financial services and does not hold an Australian Financial Services Licence.

Dovera does not provide any financial product advice (whether general or personal) in relation to the securities or participation interests which are offered by or in any Investee Entity or in respect of any other financial product. In particular, Dovera makes no recommendation as to the suitability of any investment opportunity for any potential investor and does not take account of any investor’s financial situation or needs in making information about Investee Entities available to members of private capital marketplace.

Dovera does not provide dealing services in relation to any financial products, including any securities or scheme interests issued or to be issued by an Investee Entity, whether by way of arranging their issue, acquisition, variation or disposal or by any other means.


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