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Ep. 258: Randy Schwimmer on Why Private Credit Is Performing
Mar 7, 2025
Randy Schwimmer, Vice Chairman of Churchill Asset Management, shares his expertise in private credit and capital markets. He discusses the current macroeconomic landscape's impact on private credit, highlighting trends in service-oriented businesses and the significance of free cash flow. The conversation delves into deal activity, M&A, and LBO complexities, while also addressing how direct lending managers adapt to interest rate fluctuations. Additionally, Schwimmer touches on the transformative role of AI in portfolio management within private equity.
50:49
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Quick takeaways
- The macroeconomic environment significantly influences private credit, with service-oriented sectors proving more resilient during economic fluctuations.
- Direct lending has gained traction as a standalone asset class, allowing institutional investors to enhance deal flow while managing risks effectively.
Deep dives
The Macro Landscape and Private Markets
The current macroeconomic environment critically influences private markets, particularly as interest rates and inflation fluctuate. Sectors focusing on service-oriented businesses, such as logistics and healthcare technology, have been identified as more resilient during economic cycles. For instance, during COVID, commercial landscaping services maintained steady revenue despite general economic downturns, highlighting their essential nature. The podcast discusses the importance of understanding both macroeconomic headwinds and tailwinds, which help investors assess the viability of various sectors in private credit.
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