Access to the private credit market, emphasizing current yield with an aim toward downside protection
The direct credit investment strategy is focused on the opportunity set within more senior components of a company’s capital structure, and with characteristics including contractual yield, shorter duration and capital preservation. Our goal is to provide investors with attractive, risk-adjusted returns by employing our differentiated approach to this strategy.
- Investing alongside experienced, best-in-class general partners operating in their areas of expertise
- Focusing on transactions with Hamilton Lane information and/or access advantages
- Prioritizing transaction structures designed to offer enhanced downside protection
- Emphasizing asset quality by targeting defensible, market-leading assets
Deal Spotlights
Vensure Employer Services
Who they are
A provider of Human Capital Management (“HCM”) software and services to small and medium-sized businesses (“SMBs”).
Why it matters
Proceeds refinanced existing debt and provided funds for continued M&A, positioning the company to grow and further strengthen its leading position in a market with ample whitespace.
The HL advantage
Our conviction in Vensure is bolstered by our more than 20-year relationship with both the credit and equity sponsors.
The bottom line
The investment is well-priced given the structural seniority in the capital structure. The company leveraged its best-in-class technology to offer outsourced HCM functions including payroll, benefits, insurance, compliance and more on behalf of clients. Vensure’s business model provides a compelling value proposition to SMBs as they realize large-scale company benefits despite their smaller size in a cost-effective manner. Switching costs for these service offerings are high-yielding, recession-resilient and stable recurring revenue.
Togetherwork
Who they are
A cloud-based software and payments provider serving member-based organizations, including associations, non-profits, unions, faith-based organizations, dance studios, pet care centers and more.
Why it matters
Togetherwork provides customer relationship management, enterprise resource planning and payments solutions critical to the core operations of businesses it serves. Customer feedback indicates that the company’s tailored, all-inclusive service offering uniquely differentiates its value.
The bottom line
This is a strong investment in a recession-resilient business with highly recurring revenue, a diversified customer base, industry tailwinds and a plan for growth through M&A, alongside a proven integration track record.
The HL advantage
We have a 15+ year relationship with the equity sponsor, strengthening conviction in the position.
Cadence Education
Who they are
Cadence Education provides early childhood education services, with a primary focus on children under the age of five. The company owns and operates 300+ schools and academies in 30 states across the U.S.
Why it matters
Cadence provides a service desired by parents across the country, as studies show high-quality early childhood education services positively impact child development. The company provides a premium curriculum offering and is the school of choice for many families across the U.S.
The bottom line
The investment is attractively priced in line with its seniority in the capital structure. Cadence has strong prospects for growth, with 40+ schools in its acquisition pipeline and a track record of 190+ successfully integrated locations. Pointing to stability, Cadence has a strong referral base stemming from customer satisfaction and a diversified campus base, with no one state accounting for more than 8% of locations.The HL advantage
We received preferred access to this transaction given our 23+ year relationship with the equity sponsor. Additionally, we have a proven 15+ year relationship across multiple transactions with the credit sponsor.
Our direct credit platform leverages a world-class team of experienced professionals to deliver unique access to industry-leading companies backed by leading general partners. Investors benefit from access to diverse credit strategies ranging from senior to opportunistic lending in investor-friendly structures designed to deliver performance and flexibility in areas like duration and liquidity.
Head of Direct Credit Investments
Enhancing Deal Selection and Portfolio Construction with Proprietary Data
Our vast proprietary database comprises 16,890 portfolio companies over 57 vintage years. Our significant investments in leading private markets technology platforms and our extensive network of relationships with general partners allows us to be highly selective investors. We gain access to unique opportunities in part by leveraging our technology capabilities to make better-informed investment decisions.
As of 12/31/2024