Private Debt

PRAISE FOR PRIVATE DEBT, SECOND EDITION "Steve Nesbitt has been a consistent thought leader in the private credit space. From his front row seat, Nesbitt offers valuable insights into the world of corporate lending. Private Debt is a must-read for anyone looking to gain a deeper understanding of this growing and ever-evolving asset class." - Michael Arougheti, Co-Founder, CEO, and President, Ares Management Corporation "Steve Nesbitt has been at the forefront of the private credit industry throughout its evolution from a tactical portfolio allocation into a strategic asset class. No one in the space has a more comprehensive perspective of the landscape or a more nuanced understanding of the drivers of performance." -Michael Patterson, Managing Director, HPS Investment Partners, LLC "The education and leadership that we see in the material that Steve Nesbitt produces is helping accelerate the secular shift towards private credit. He excels at providing both institutional and individual investors greater transparency and insight to the asset class." - Brad Marshall, Senior Managing Director and Head of North America Private Credit; CEO, Blackstone Private Credit Fund (BCRED), Blackstone Inc. "Steve Nesbitt has not only advanced the understanding of credit and alternative lending with Private Debt, but has also walked-the-walk by helping both the largest and smallest investors access this fast-growing asset class." - Edward Mulé, Founding Partner, Portfolio Manager and CEO, Silver Point Capital, LP

STEPHEN L. NESBITT is Chief Executive Officer and Chief Investment Officer of Cliffwater LLC, an investment advisory firm specializing in alternative investments, including private debt, hedge funds, private equity, real estate, and infrastructure.

Introduction Acknowledgments About the Author Chapter 1: Overview of U.S. Middle Market Corporate Direct Lending Chapter 2: The Historical Performance of U.S. Middle Market Direct Loans Chapter 3: Performance Comparisons to Other Asset Classes Chapter 4: Current Yield or Yield-to-Maturity? Chapter 5: Comparative Credit Loss Rates Chapter 6: How Liquid Are Direct Loans? Chapter 7: Middle Market Loans as a Hedge Against Rising Interest Rates Chapter 8: Credit as a Separate Asset Class Chapter 9: Senior and Unitranche Direct Lending Chapter 10: Loans and the Theory of Credit Chapter 11: Risk Premiums in U.S. Middle Market Lending Chapter 12: Covenants and the Loan Agreement Chapter 13: Should Direct Loan Portfolios Be Leveraged? Chapter 14: The Democratization of Alternatives Chapter 15: Business Development Companies (BDCs) Chapter 16: Interval and Tender Funds Chapter 17: Selecting Direct Lending Managers Chapter 18: Loan Valuation Chapter 19: Investment Fees Chapter 20: Portfolio Construction Chapter 21: Expected Returns and Risks from Direct Lending Chapter 22: Asset Allocation Chapter 23: All-Weather Private Debt Chapter 24: Enter SOFR Chapter 25: European Middle Market Direct Lending Chapter 26: The Borrower's Perspective Chapter 27: Enhanced Lending Conclusion Index