NexGen Capital Investors

Using a manager of managers strategy, we have created a multi-disciplined investment platform which relies on our knowledge of the fixed income and alternative investment markets to create attractive investment products that produce attractive risk-adjusted returns and will likely achieve other significant non-financial returns to our investor audience.

Fixed Income

Through a strategic alliance with a significant nationally-known and respected fixed income investment manager, we focus on the construction and management of high-quality state- and local-related bond portfolios composed of non-index securities.  The portfolio management team has established long-term strategic asset allocation ranges, which call for the inclusion of alternative investment instruments.

As a manager of investment managers, these portfolios are comprised of municipal bonds representing certain sub-sectors of the bond market traditionally excluded from the major bond indices.  We believe that these sub-sectors of the bond market are undervalued and may offer a relative yield advantage, and an opportunity to generate above-average risk-adjusted returns with lower volatility and lower credit risk.  To enhance the yield of these structured investment products, we also invest in selected alternative investment funds which support the junior capital financing needs of selected middle-market and small businesses.

Alternative Investments

Pursuant to a thorough and rigorous investment process and beginning with: (i) screening, (ii) initial selection, (iii) due diligence, (iv) final selection and (iv) monitoring, we will carefully select SBICs for inclusion into our various funds. Each prospective SBIC fund is reviewed in light of certain qualitative and quantitative investment criteria with a view toward determining whether a prospective SBIC has received SBA regulatory approval and has:

• A successful investment track record relative to vintage year peer groups
• Quality deal flow
• A disciplined investment focus, methodology and process
• A verifiable reputation and presence in the subordinated debt and private equity markets
• A stable and cohesive investment team
• Economic interest alignment with investors
• Sufficient resources to support anticipated investment activity
• Market-calibrated fund economics, including management fee, expenses, carried interest and other terms.

These are the primary,but not the only, factors in our SBIC selection process, although the Fund Manager believes that the following attributes represent some of the important determinants of success for any alternative investment fund, especially an SBIC:

• Quality of the experience and continuity of management
• Consistency of investment strategy
• Integrity of its investment process and infrastructure
• Alignment of economic interest of the SBIC and its investors
• Access to deal flow