Alt Lending week ending 6th May 2022


When you’re looking for a long term relationship you shouldn’t go on first impressions.

This was the strapline from an advertisement from an asset management company that proudly stated that “ No one knows Smaller Companies like we do”. I couldn’t let this pass me by as they also mention that they have a large team of analysts and, would you believe it, they actually insist on meeting the management team in person, often going in pairs, like policemen in a rough neighbourhood. If analytical companies have to single this out as a USP then we are really all in trouble. OK they are talking about equities but any kind of finance requires an intimate knowledge of the people running the business. How are you supposed to get that without meeting them?  In the commercial lending field it is critical to decision making. It sometimes seems like we are forgetting how the basics are actually being handled. No one who worked for me in the credit field would ever dare tell me that they did not know the management of a company they were following or that they hadn’t visited a production centre. Tumbleweeds on the factory concourse tell you a lot more about a business than you will ever get from audited accounts.

Zombie companies a drag on UK economy.

The unreal interest rate environment that we have all lived through since 2008 looks like it might be coming to an end and talking about basics, Jeremy Warner gives us a sound lesson in basic economics and cost of capital, reminding us that there are a large number of companies out there which are only just about existing as a result of zero interest rates. This means that they are not growing, investing or innovating and are probably not going to last too much longer. The banks have no appetite to grasp this nettle and the government have still got to get to grips with the fall out from its Covid loans fraudfest.  When outfits reach this stage it is better for all of us if they quit the scene and let someone else use the resources they are wasting. I don’t think our clueless government gets this at all and neither does the opposition. Loading taxes on business and people isn’t at all helpful.  It is even more important during a time of fast technological change when investment in new processes and equipment are required.  The only good news about this is that there are several European countries that are in an even worse state than we are. Not much joy in that is there?


$ 500 billion under management. Not bad for a Covid start up.

This is largely family office money. QE has made the rich much richer and who gives a damn about who is left out. I am reminded of family offices every time I enter Mayfair. You can almost smell the money. With it has come a whole new breed of unregulated spivs in sharp suits who don’t necessarily know much about finance but have long contact lists in the family office space. They make their money from introductory and success fees. Over the last six months I have seen some of the mayhem they can cause. What concerns me is that there is so little actually knowledge of how the world works that inexperienced people are easily fooled by a smooth talking Joker Broker. In addition some of these guys have developed influence, through networking within regulated institutions, that they shouldn’t have. Where are the regulators when you really need them?


Howard Tolman is a well-known banker, technologist and entrepreneur in London,We have a self imposed constraint of 3 news stories per week because we serve busy senior  Fintech leaders who just want succinct and important information. For context on Alt Lending please read the Interview with Howard Tolman about the future of Alt Lending and read articles tagged Alt Lending in our archives.

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