Marshall Investments targets $100 million for second growth credit fund
And finally, the fund’s mandate allows it to invest up to 15% of its total contribution in direct shares of growing companies.
Fundraising documents indicated that Marshall Investments had already warehoused two deals for the second fund, which were generating revenue.
Also on display were the returns from the company’s past growth credit investments.
The company achieved a net IRR of 17.7% from a $12.5 million loan to home improvement market hipages after its IPO. A $2 million loan to marine safety maker Vesper Marine for product development generated a net IRR of 16.4% two years later in December 2021 when the business was sold.
The company began underwriting “growth credit” loans in 2018, through its decade-old structured debt investment arm (formally called Growth Capital Partners and Property Capital Partners), which invested some $400 million. for co-investors in more than 70 transactions. . The historical average return for co-investors has been 15% on an IRR basis.
The first growth credit fund ended up lending to 11 companies and generating an annualized return of 10.4% (paid quarterly). His individual loans were between $2 million and $10.5 million. All were first secured and generally amortized over three years.