GP Financing Without the Banking Strings

GP financing is the hardest money in private markets to raise cleanly. The amounts are meaningful, the timing is unforgiving, and the collateral, your GP commitment, your carry, your management company, is exactly what banks do not know how to underwrite on its own. So they underwrite the relationship instead. This page explains how we do it differently.

The three ways bank GP financing goes wrong

The first is the relationship toll. Most banks will not lend to a GP at all unless the manager moves its operating accounts, deposits and custody across. The loan is a door prize for the banking relationship, and if you are happy where you bank, the conversation ends there.

The second is quieter and worse. Some banks will offer GP financing as part of a package in which the fund takes its subscription line from the same bank, at a price the fund would not otherwise accept. The GP gets its financing, the fund pays for it. We think a GP that trades a more expensive fund facility for its own liquidity has a conflict it cannot explain to its LPAC, and we built our facilities so no GP ever has to make that trade.

The third is timing. Banks are quick to say yes and slow to wire. Credit committee cycles, ancillary negotiations and documentation routinely stretch past six months. GP needs do not wait that long. A capital call lands on a fixed date. An acquisition has a signing deadline. A management company payroll gap is measured in weeks. We have repeatedly seen strong GPs lose deals not because the bank said no, but because the yes arrived after the deadline had passed.

What we finance

We provide facilities of $10 million to $100 million and above for GP commitments to new funds, bridging capital calls, co-investment obligations, follow-on deployments, management company working capital, accelerating carry ahead of realisations, and equity transactions within the manager, including succession and partner buyouts. Facilities are secured against GP interests, carried interest and fund stakes, structured as cash pay or PIK, over one to five years, in USD, EUR or GBP.

How fast it moves

Send us the structure chart, the fund NAV statements, and what the money is for. We come back within days with an indication of appetite and a term sheet, and prepared borrowers fund inside a month. You deal directly with the people who make the credit decision, starting with our founder. There is no relationship committee because there is no relationship requirement. The facility has to make sense on its own economics, which is exactly why we can be fast.

Talk to the decision maker

If you are a GP working against a capital call, a deal deadline or a cash flow pinch, email me directly at abranton@nodem.com with the outline and the date you need to fund. I will tell you quickly and honestly whether we can hit it.