Which Private Capital Service Can Help with Direct Lending Options?

By Taimour Zaman

When traditional banks pull back on lending, private capital steps forward. Direct lending—where non-bank firms provide loans directly to businesses—has exploded into a trillion-dollar global asset class. For accredited investors, it has become one of the fastest-growing ways to access steady income streams, while for borrowers, it offers speed, flexibility, and fewer hoops than traditional banks.

But here’s the key: not all direct lending is created equal. The exemplary private capital service can make the difference between a well-structured deal and an overpriced loan that erodes returns.

Why Direct Lending Matters

Direct lending emerged after the 2008 financial crisis, when banks tightened their lending standards. Since then, it’s evolved into a mainstream asset class, serving companies that are:

• Too big for microloans but too small for syndicated Wall Street facilities.
• Too unique or risky for bank balance sheets.
• Looking for speed in acquisitions, expansions, or recapitalizations.

For accredited investors, direct lending provides:

• Predictable income through interest payments.
• Diversification beyond public markets.
• Access to companies not available through traditional equity channels.

Private Capital Services That Specialize in Direct Lending

1. Private Credit Funds

• Offer tailored loans to middle-market businesses.
• Known for structuring senior secured, mezzanine, and unitranche loans.
• Examples:
  • Golub Capital (one of the largest middle-market direct lenders).
  • Ares Capital (publicly traded BDC, heavy in private credit).
  • Monroe Capital (lower middle-market sponsor-backed deals).

2. Business Development Companies (BDCs)

• Publicly traded vehicles that invest in private debt.
• Provide accredited investors (and, in some cases, retail investors) with access to diversified portfolios of direct loans.
• Examples: FS KKR Capital, Owl Rock Capital, Hercules Capital.

3. Family Offices & Independent Sponsors

• Increasingly active in bespoke direct lending deals.
• Benefit from flexibility and personal relationships with borrowers.
• Often co-invest alongside private equity.

4. Alternative Asset Managers & Platforms

• Platforms are emerging to connect accredited investors directly with private credit opportunities.
• These services focus on lowering entry thresholds, broadening access, and providing transparency.
• Examples: YieldStreet, Percent, and other digital private credit marketplaces.

What to Look For in a Direct Lending Service

Before committing capital, investors should evaluate:

• Track record: Has the firm weathered different credit cycles?
• Risk discipline: What’s their default and recovery history?
• Structure: Do they focus on senior secured (safer) or mezzanine (riskier but higher yield)?
• Transparency: Are fees and reporting clear?
• Alignment: Does the firm co-invest alongside its clients?

Risks to Keep in Mind

Direct lending is not risk-free. Accredited investors must consider:

• Credit risk (borrower defaults).
• Liquidity risk (long lock-up periods).
• Market cycles (rising rates, recessions).
• Regulatory shifts (tightening capital requirements).

Bottom Line

Private capital services have transformed direct lending into a mainstream opportunity for accredited investors. Whether through private credit funds, BDCs, or specialized platforms, the key is choosing partners who combine discipline, experience, and transparency.

Done right, direct lending can deliver the kind of stable yield and diversification that traditional markets no longer guarantee.

Next Step: Book a Consultation with AltFunds Global

If you’re an accredited investor exploring direct lending, it’s not just about finding a fund—it’s about finding the right fit for your capital goals and risk tolerance.

At AltFunds Global, we help investors cut through the noise, evaluate direct lending services, and structure opportunities that deliver actual performance.

👉 Want tailored guidance? Schedule your strategy call now.

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This publication is provided strictly for educational and informational purposes. It does not constitute, and should not be construed as, an offer, solicitation, or recommendation to purchase, sell, or otherwise engage in any transaction involving loans, private equity, credit facilities, standby letters of credit (SBLCs), bank guarantees, or any other financial instruments.

AltFunds Global AFG AG is neither a bank, broker-dealer, nor a licensed financial intermediary under Swiss law. All references to financial instruments, providers, or case studies are illustrative in nature and are not to be interpreted as investment advice or a guarantee of performance.

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Past performance, case studies, or survey data referenced in this article are not indicative of future results. No assurance is given that any transaction or product mentioned will be available, suitable, or profitable.