Insightful Investor #52 - David Chene: Non-Sponsor Backed Private Credit
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Jan 7, 2025 David Chene, co-founder and co-portfolio manager of Kennedy Lewis, delves into the world of non-sponsor backed private credit. He draws intriguing parallels between Ironman racing and investing, emphasizing adaptability and strategic planning. Chene shares insights on the growth of private credit as a sought-after asset class, its appeal due to yield premiums, and how it serves as an alternative to traditional bank lending. He also discusses the importance of management strategies and explores investment opportunities in underinvested sectors like energy.
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Ironman Races and Lessons Learned
David shared his experience of completing eight Ironman races, emphasizing discipline and mental strength. He found parallels between the challenges of racing and the journey of building Kennedy Lewis.
Market Dynamics in Private Credit
David explained that the private credit market is growing due to bank deleveraging and the increasing need for alternative financing. This trend opens up new opportunities for private lenders.
Evolution of Private Credit
David observed that the private credit market has matured significantly post-GFC, with a shift from bank-backed transactions to private lenders. This evolution has created more credit opportunities outside traditional structures.