Northway Specialty Finance
Capital where complexity creates opportunity.
Northway is a specialty finance investor based in Westport, Connecticut.
Introduction
Northway’s six areas of focus span consumer, commercial, legal, and corporate finance. Each is complex for its own reasons, and in each the asset, its terms, and the parties behind it must be understood together.
Philosophy
Complexity is a question, not a verdict.
Understand the asset first
Capital should follow understanding, not lead it. The source of cash behind an asset should be traced and tested before anything else is decided. Complexity that cannot be explained is a reason to stop.
Build terms around cash flow
Terms should reflect the way an asset pays, not a standard template. When cash arrives unevenly, the structure should expect it. Structure cannot repair a weak asset, but it can undermine a sound one.
Be candid with counterparties
In specialized markets, counterparties tend to meet more than once. A clear answer given early serves everyone better than a vague one given late. Neither side should have to guess where the other stands.
Strategies
Areas of Focus
Specialized capital across complex and evolving markets.
01 Merchant Cash Advance
Northway focuses on financing companies that originate merchant cash advances. In a merchant cash advance, a business sells a share of its future receivables in exchange for an upfront payment.
02 Consumer Debt Settlement
Northway focuses on financing debt settlement companies. These companies negotiate settlements of consumers’ unsecured debts with their creditors, and earn fees as settlements are reached.
03 Online Gaming
Northway focuses on financing operators and suppliers in real-money online gaming and sports wagering. Licensing and permitted activity in this sector are set jurisdiction by jurisdiction.
04 Pre-settlement Litigation
Northway focuses on providing capital to pre-settlement funding companies. These companies make non-recourse advances to plaintiffs with pending legal claims, repaid only from a settlement or award.
05 Consumer Retail Installment Loans
Northway focuses on providing capital to lenders and finance companies that originate or acquire consumer retail installment loans. These loans finance a purchase at the point of sale and are repaid in scheduled installments.
06 Complex and Active Corporate Loans
Northway focuses on credit for companies whose financing needs fall outside standard lending criteria. These needs call for individually negotiated structures and continuing oversight.
Approach
How a financing takes shape, stage by stage.
Each stage is meant to settle one question before the next begins. The questions stay the same across the six areas of focus, even though the answers differ from one area to another.
Sourcing
We start with originators and servicers in our areas of focus, and with the intermediaries who know them. The first question is whether there is a fit on both sides.
Underwriting
We test how similar assets have paid, what governs the asset, and who services it. The aim is to see how its cash flow behaves in ordinary conditions and in harder ones.
Structuring
We set each term around an asset’s cash flow: its timing, what is reported, who is paid first, and what happens if it falls short. The documents, drafted with outside counsel, record what both sides agreed.
Monitoring
We track reporting against the agreed terms for as long as a financing is in place. When conditions change, we take the matter up with the counterparty early.
Selected statistics
Figures are shown as of the dates stated and come from the sources noted with each one. They describe past or current conditions only. They are not a forecast or a guarantee of any future outcome and are not an offer or a solicitation.
Leadership
Insights
Perspectives
Capital where complexity creates opportunity.