Having worked across many verticals in the credit space, I find non-bank financial institutions (NBFIs) to be one of the most fascinating areas of the private credit market.
Two key dynamics are shaping the landscape right now:
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The UK market is becoming increasingly crowded, with many funders chasing a finite pool of deals.
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Institutional investors are showing more appetite for European opportunities, looking for diversification, new origination channels, and differentiated risk/return profiles.
This creates a unique window for platforms that are well-positioned to attract institutional capital — and for funders seeking strong counterparties and well-structured transactions.
Where We See the Most Momentum
We see particular opportunity among platforms that have already proven their concept — often with seed capital from founders, friends, and family offices — and grown from €0 to €25m in volume. These businesses are now ready to scale towards €100m and need funding solutions that can get them there efficiently.
We're also speaking with more mature platforms that have already reached around €100m in volume and are now focused on improving their funding terms to fuel the next stage of growth — aiming for €250m and beyond.
Helping platforms navigate this transition — from early-stage backers to institutional funding, and then optimising cost of capital — is where I believe a lot of value can be unlocked, for both platforms and their investors.
Fintechs – and How to Get it Right in a Non-Bank Lending Context
One recurring theme we notice when working with platforms is the use of the term Fintech. Many early-stage NBFIs describe themselves as fintechs, but in reality, there is often very little “tech” involved — it’s simply traditional lending done outside the banking system.
To me, true fintech in a non-bank lending context means that technology drives the ability to scale. Operations should be so efficient that the only limitations should be the capital available to lend and the size of the target market and geography — not the ability to originate, process, or service loans.
When a platform has secured funding but still struggles to deploy, we usually see two potential reasons:
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Sometimes, the issue lies in the funding structure — perhaps the terms or advance rates make deployment inefficient.
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Just as often, however, platforms overestimate how much they can deploy effectively given their market, risk appetite, or operational setup.
Getting the tech right means that deployment capacity should be limited only by market size — not by internal bottlenecks. This becomes particularly critical as platforms scale from €25m to €100m, when growth starts to expose operational weaknesses.
The Four Stages of Platform Maturity
From my experience working with platforms across the UK and Europe, I typically see four distinct maturity stages — each with its own funding needs and challenges:
|
Stage |
Typical Volume |
Funding Need |
Capital Availability |
Key Challenge |
|
Startup |
€0–25m |
Fully equity backed |
Equity-backed or forward flow |
Finding the “first believer” willing to back the concept with patient capital |
|
Growth |
€25–100m |
Roll original backer into junior position + secure senior funding |
Senior widely available; mezzanine starting to attract €25m+ providers; smaller mezz providers €5–15m possible; stretched junior emerging; 5–15% equity/first-loss if no stretched junior |
Structuring the transition efficiently and maintaining alignment |
|
Established |
€100m+ |
Optimise capital structure, lower senior cost, extend tenor |
Senior easily accessible; mezzanine available; stretched junior options; equity/first-loss usually required if no stretched junior |
Balancing pricing and flexibility across multiple lenders |
|
Mature |
€250m+ |
Direct relationships with banks, insurers, and credit funds |
Senior fully accessible; mezzanine and stretched junior negotiated or provided directly by the platform; equity/first-loss provided directly by the platform; forward flow options |
Managing complex multi-layered funding structures efficiently |
This framework helps both platforms and funders think about where they sit on the maturity curve — and what the logical next step in their funding journey should look like.
Availability of Capital
One of the most common questions we get from platforms is: “How easy is it to get funding?”
From our experience:
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Senior financing is typically the easiest part to obtain. This can be structured as normal senior debt, stretched senior tranches, or forward flow agreements. Forward flow agreements typically assumes 100% of the capital risk but also provides smaller economical incentives for the platform. Once a platform has a credible track record and underwriting standards, senior lenders are generally willing to deploy.
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Mezzanine financing is slightly trickier. Most reputable mezzanine providers generally require a minimum of around €25m in deployed volume before they become interested. However, once you secure a credible mezzanine provider, they make arranging senior debt easier, because their junior support enhances lender comfort and enables more leverage.
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Opportunities with smaller mezzanine providers exist. Some providers are willing to supply €5–€15m of mezzanine but may not come with a tier-1 name attached. This can still work effectively, as long as the senior provider is comfortable with the underlying asset class as well as the mezzanine provider.
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The hardest — and most sought-after — type of capital is what I call a “stretched junior.” This is a provider willing to supply both first-loss and mezzanine capital. They do exist, typically in the form of credit funds, though some banks do this as well.
From the platform’s perspective, a stretched junior provider often aligns closely by taking an equity stake in the platform. While they rarely request a majority position, they will usually take a meaningful minority stake — which can be an important signal of alignment and long-term partnership.
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Equity / first-loss is almost always required. Most, if not all, funders will require some form of equity or first-loss piece in the structure, typically between 5–15% of the overall funding. The alternative is limited to forward flow agreements, which sit outside the platform’s balance sheet and do not require a first-loss contribution hence affecting economics. Alternatively and if available - a strecthed junior.
Final Thoughts
Whether you’re a platform at the proof-of-concept stage, scaling from €25m to €100m, or optimising a €250m book, the right funding structure can make the difference between steady growth and exponential growth.
If you’re thinking about your next step — or if you’re a funder looking for high-quality opportunities across these stages — I’d be happy to connect and exchange ideas.