How we work
When the loan was made, someone underwrote it. When a credit is challenged, almost no one underwrites the recovery. We do, and we can act on the answer in three ways.
- Stabilize and operateInterim leadership and operating work, while the next step is decided.
- Underwrite and prepareExit underwriting, then the fix list worked in value order.
- Bid, where you ask for oneOur bid at the supported price, delivered with the underwriting.
You set the recovery objective
Best recovery means different things on different loans: sometimes speed, with flexibility on the mark; sometimes maximum value, with the patience to earn it; usually the honest question of which of the two the credit can actually support. Every engagement starts with your objective, and we report against it. The two-scenario recovery analysis is the instrument: what a sale supports prepared, against what it supports as-is, so speed and value are priced against each other rather than argued about.
Stabilize and operate
A 13-week cash flow tells you how long the company can wait. It does not stop the waiting from doing damage. In software, stress drains confidence before it touches revenue: customers renew more carefully, engineers leave. So the first job is often operational: interim leadership, a chief restructuring officer seat where one is needed, and the operating work that holds the platform and the team together while the next step is decided. We have run these companies as executives, not observed them as analysts.
One rule attaches to this seat: where we hold a fiduciary operating role, we do not bid on that company. One seat per company, and the election is yours, confirmed in writing before the mandate begins.
Exit underwriting
The core diagnostic: four to eight weeks from access, priced as one fixed fee quoted after scoping (a number, not a range), the same fee whatever it concludes and whether or not you have asked us to bid, and structured to stand on its own, so it never needs to become anything else to have been worth doing.
What it examines is what a buyer’s diligence will examine: the revenue base and how it renews, the product and the platform under it, the team that holds both, the buyer universe as it actually is, and the timeline the company’s liquidity allows.
What it produces is the four straight answers: what the company is worth, who actually buys it, what has to be fixed first, and how long that takes. Behind them sit the fix list (every defect diligence would find, priced in enterprise-value terms) and a conclusion: go, no-go, or sell as-is. This is also where our capital enters: where you have asked for it and the company fits our mandate, our bid at the supported price arrives with the report, a real number from a buyer who has done the work, before the process rather than after one fails. It is an option you can test in the market and decline at no cost but the decision, and we bid only on companies we would want to own and can see a way to sell.
What lands on your desk
- The defect list
- Every issue a buyer’s diligence would surface, each priced in enterprise-value terms.
- The two-scenario recovery analysis
- What a sale supports prepared, against what it supports as-is, measured against the recovery objective you set. Which seat we hold on the name is your election, confirmed in writing as part of the engagement: on an operating-partner name we do not bid and the analysis comes from a firm with no bid on the table; on a bidder name the analysis and the bid arrive together, at a fee that changes with neither.
- The cost of delay model
- What each quarter of waiting costs, in the company’s own numbers.
- The supported valuation
- The number the evidence carries, and the buyer universe that pays it.
The no-go call, and then what
Sometimes the underwriting says do not go to market. We make that call plainly, because the alternative is worse: a process that fails in public, and a company that carries the broken-process discount into every later attempt. Some findings are harder still, companies where the honest conclusion is that no turnaround is fundable, and we say that too, with care, because boards and teams deserve the real answer.
A no-go is not a dead end; it comes with the recovery options that remain. Sometimes that is the fix list: what would change the answer, and what it is worth. Sometimes it is a sale run as-is, prepared in weeks rather than months, with the narrative and the data room built against the defects a buyer will find. And where the company will not sell as a going concern, it is an honest salvage plan for the collateral.
Working the fix list
If the answer is go, or becomes go, we work the list: each defect fixed in the order of what it is worth at exit, against a committed launch date. Where the timeline allows, that is a remediation window of six to eighteen months, sized by how much of the list has to show in the trailing twelve months a buyer underwrites; where it does not, it is the compressed version: the highest-value fixes only, in the weeks the situation gives us, and what those weeks buy is readiness, not remediation. This is not a general improvement program. It is preparation for one specific event, run dual-track where the situation calls for it, so the sale path and its alternative are priced against each other rather than argued about.
The economics follow the work: the preparation is paid for the time it takes, and the larger part of what we can earn is an incentive bonus on the outcome, the sale, its timing and the recovery, measured against the objective you set and agreed in writing before the work begins.
One more thing the list is not: a cut list. In a business whose value is confidence, the people who hold the customer relationships and the code are the asset, so we replace only where necessary. Where the team is part of the problem, the underwriting says so plainly and the operating seat exists to fix it.
Each stage earns the next
Each stage is priced to stand on its own, and none of them asks you to commit ahead of the evidence. The operating seat, the fix list and the as-is sale are what the underwriting can trigger.
- The portfolio watch
- The standing screen across your book. Quarterly, run on the reporting you already hold, no name designated.
- The first read
- One name, two to three weeks, largely off your existing reporting package plus one management session. It answers two questions: what recovery range does this credit support, as-is and prepared, and whether a full underwriting is worth buying.
- Exit underwriting
- The full diagnostic, where the first read has earned it, and the door to the preparation, the operating seat, or the bid.
Conflicts and decision rights
We bid on companies, and we are paid when companies we did not buy recover well. It is fair to ask which outcome we are rooting for, and the answer is structural, not rhetorical. On any one company we take one seat, bidder or operating partner. The election is yours, confirmed in writing as part of the engagement: you can ask for a bid from us where the company fits our mandate, or have us act only as operating partner with no bid. It is not revisited mid-engagement, and where we hold a fiduciary operating role we do not bid on that company. The underwriting belongs to you: a bid from us is an option you can test in the market, not a price you are anchored to, and declining it costs you nothing but the decision. The diagnostic fee is fixed and is the same whatever the report concludes, and the same whether or not you have asked for a bid. The bid methodology, the decision timeline and the information walls are agreed in writing before we see anything. And where a counterparty wants the question off the table entirely, we sign a no-acquisition covenant and mean it.
One fence for the avoidance of doubt: we are not a banker. We do not run sale processes, contact buyers, negotiate transaction terms or handle proceeds. When it is time to sell, the mandate goes to a banker, walking into a process the underwriting has already made ready.