When I look back at my career, I see two very different worlds that, in their own way, shaped the investor and entrepreneur Over the years, I’ve watched financial markets evolve in ways that few could have predicted. Interest rates have swung from historic lows to rapid hikes. Inflation, once considered dormant, has re-emerged as a force that shapes every decision consumers and businesses make. Volatility in equities has become the norm rather than the exception. In this environment, many investors are left asking the same question: where can I find stability?
For me, the answer has consistently led back to one asset class that remains underappreciated by the broader public: private credit. While it was once reserved for institutional investors, private credit has become increasingly relevant for individual investors who want steady, predictable income without the rollercoaster ride of public markets.
The Shifting Landscape of Today’s Markets
Public equities have always been a cornerstone of investing. Yet today, they come with challenges that are hard to ignore. Earnings cycles are increasingly influenced by short-term pressures, and market sentiment can turn on a single headline. Bonds, traditionally a safe harbor, no longer offer the yields they once did. Savings accounts may protect capital, but inflation steadily erodes their real value.
Against this backdrop, investors are forced to rethink. The old 60/40 portfolio rule — 60% stocks, 40% bonds — feels outdated in a world where both asset classes face structural headwinds. That’s where private credit enters the conversation.
What Makes Private Credit Different
Private credit refers to loans made by non-bank institutions directly to private companies. These agreements are typically negotiated one-on-one, which allows for flexibility and transparency. Unlike public bonds, where terms are standardized and subject to market swings, private credit arrangements can be tailored to balance the needs of both borrower and lender.
For the investor, this often means:
- Predictable income: Returns are contractual and set in advance, often in the 7–12% range depending on structure and borrower profile.
- Reduced volatility: Because these deals aren’t traded on public exchanges, they’re less vulnerable to short-term sentiment or speculative swings.
- Control and customization: Investors can choose the duration, the type of borrower, and the risk profile that fits their goals.
Private credit isn’t risk-free, of course — no investment is. But the risks are more transparent, and they can often be mitigated through collateral, covenants, and careful structuring.
Why Now Matters More Than Ever
Timing plays an important role in any investment decision. Right now, the conditions that make private credit compelling are clearer than ever.
- High interest rates mean borrowers are looking for alternatives outside of traditional bank financing, creating more opportunities in private lending.
- Bank retrenchment after regulatory changes has left gaps in the market that private lenders are filling.
- Demand for income is stronger than ever, as retirees and income-focused investors seek returns that can outpace inflation.
When I look at these trends together, it’s obvious that private credit is no longer a niche corner of finance. It’s a mainstream solution for a problem many investors face: how to secure consistent returns in uncertain times.
Lessons from My Own Transition
I didn’t come to private credit by accident. My career began in fast-moving sectors like e-commerce, where success required constant reinvention and tolerance for volatility. Over time, though, I realized that chasing speed wasn’t the same as creating value.
That realization led me to explore asset classes that favored stability and alignment. Private credit checked every box: it rewards discipline, creates predictable cash flow, and puts relationships over speculation.
I’ve shared more about this shift in my post on long-term wealth building through structured capital. It explains why I moved away from traditional models in search of something more resilient.
The Human Side of Private Credit
Numbers and returns are important, but private credit is also about relationships. Every deal involves people — entrepreneurs building their businesses, investors allocating their capital, and institutions structuring agreements. That human element matters.
Unlike trading shares on an exchange, private credit requires conversations, due diligence, and alignment of incentives. I believe that’s one of the reasons it has staying power. It forces both sides to think long term.
And for investors like me, who value trust and clarity, that’s a feature, not a drawback.
Who Can Benefit Most
Private credit isn’t a one-size-fits-all solution. It works best for investors who:
- Value steady income over speculative upside.
- Can tolerate reduced liquidity — capital is often locked for a set period.
- Want transparency in how returns are generated.
- Are looking for an alternative to bonds and equities in their portfolios.
For retirees, family offices, or anyone seeking diversification, private credit can be a meaningful addition to the mix. It doesn’t replace traditional investments but complements them.
Final Thoughts
In an era defined by uncertainty, I see private credit as one of the few strategies that aligns with today’s realities. It’s not about chasing the next big thing. It’s about building steady, sustainable returns in a way that prioritizes clarity and discipline.
For me, that’s more than an investment approach — it’s a philosophy. And in times like these, it feels less like an alternative and more like a necessity.
Stuart Simonsen
Stuart Simonsen
