The Wall Street Skinny 192. Distressed Debt 101 with the Private Credit GOAT Michael Gatto
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Nov 17, 2025 Michael Gatto, Head of private-side investing at Silver Point and author of The Credit Investor's Handbook, dives into the intricate world of distressed debt investing. He explains how it differs from equity investing and why creditor negotiations are crucial. Gatto discusses 'liability management exercises' and the chaotic landscape of private credit, emphasizing that distressed investors can be misunderstood as vultures. He also analyzes the current credit cycle and shares insights into career building in credit investing, outlining key skills and networking tips.
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Temp Agency Trick Launched His Career
- Michael negotiated his way into Goldman by signing then asking to delay his start and ultimately working as a temp through an agency to avoid headcount limits.
- That negotiation launched his Wall Street career and led him to join Silver Point with founders who recruited him earlier.
Distress Combines Finance With Legal Warfare
- Distressed debt combines standard corporate analysis with bankruptcy law and negotiation skills unique to stressed situations.
- Distressed investors often add value by providing capital, restructuring expertise, and driving bankruptcies to preserve viable businesses.
Start In Credit To Accelerate Learning
- Do credit early in your career to learn more technical nuance and become more valuable than straight equity specialists.
- Seek mentors, read widely, ask questions, and prioritize learning over early pay.
