Welcome to another episode of the Private Equity Podcast, today I’m joined by Nayef Perry, Head of Direct Credit at Hamilton Lane. We dive into the state of the private credit market—where the opportunities are, how interest rates are shaping returns, and what investors need to watch out for. If you want a sharp, no-fluff breakdown of where private credit is heading and why it still has room to run, this one's for you.
Breakdown:
[00:00] Nayef Perry, Head of Direct Credit at Hamilton Lane, joins to discuss the private credit market, interest rates, and market outlook.
[00:30] Background: Born in Miami, ex-consultant, GE Capital, joined Hamilton Lane in 2013.
[01:13] Private credit’s golden era isn’t over—higher-for-longer rates mean higher yields for investors.
[02:11] Despite growth since 2008, private credit isn’t overcrowded—$1.4T credit gap vs equity.
[03:36] Add $600B+ in upcoming maturities, and there’s a $2T+ opportunity over next 3–5 years.
[05:30] Hamilton Lane’s deal drivers: add-ons, recapitalizations, and recovering LBO activity.
[06:52] Credit lags LBO recovery but Hamilton Lane sees strong deal flow via LP relationships.
[08:42] Democratization: retail access growing through evergreen funds—low minimums, high liquidity.
[11:01] Biggest concern is defaults, but default rates and distress ratios remain below averages.
[14:55] Credit shines across market cycles—positive performance every year since 1999.
[16:51] Tight performance band and low volatility make credit an all-weather asset.
[17:44] Investment discipline is key: big deal funnel + strict filters = consistent returns.
[19:03] Four core criteria: top-tier sponsors, #1/#2 market leaders, recession-resistant sectors, strong capital structures.
[21:01] Influences: WSJ daily, Poor Charlie’s Almanack, Red Notice, industry reports.
[23:54] Thanks for tuning in—subscribe and keep smashing it.
Connect with Nayef Here.
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Got feedback or questions? Email Alex at alex.rawlings@raw-selection.com. Until next time—keep smashing it!
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