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In this conversation, we chat with Nelson Chu - Founder and CEO of Percent, the modern credit marketplace. After witnessing the inefficiencies in the private credit markets, Nelson was inspired to transform this industry for the better and founded Percent in 2018. He and his team have built an end-to-end credit platform unlike any other, empowering borrowers, underwriters, and investors to transact with confidence through governance, asset transparency, and market standardization. Nelson has been recognized by Private Debt Investor as a Rising Star in their annual list of the top 40 individuals shaping the future of private credit.
Prior to Percent, Nelson founded a strategy consulting firm that helped companies build products and raise capital for growth, creating over $1B in equity value. He also brings his background from global financial institutions, including Bank of America and BlackRock, to Percent.
Outside of Percent, Nelson pursues his personal interests in angel investing, art, and philanthropy. His angel investment portfolio includes companies such as BlockFi, Care/Of (Acq: Bayer AG), Clover Health (NAS: CLOV), dv01 (Acq: Fitch), Eden Health, Plentina, Tala, and Uala. He has been actively involved in several nonprofits, including serving as a Board Member of The Bubble Foundation, Host Committee Member for Alicia Keys’ Keep a Child Alive, and Yamba Malawi. Nelson graduated from Rutgers University with a Bachelor of Arts degree in Economics and Political Science.
Topics: Private credit, lending, borrowers, underwriting, AI, artificial intelligence, investment, alternative investment, fintech, marketplace
Tags: Percent, Lending Club, LendIt, Prosper, Blackstone
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Timestamp
1’12: From FinTech Consulting to Revolutionizing Private Credit: The Genesis of Percent
4’33: Unveiling the Void: The Journey to Establishing Essential Infrastructure in Alternative Investments
6’55: Decoding Private Credit: Navigating Yields, Risk, and Investor Dynamics in Short-Duration Fixed Income
14’01: Investor Trends and Platform Evolution: The Shifting Terrain of Private Credit Investments
19’15: Building the Bridge: Crafting the Infrastructure to Power a Tripartite Financial Marketplace
26’15: Mastering Multi-Sided Markets: Strategies for Bootstrapping Borrowers, Investors, and Underwriters
31’26: Tech as the Catalyst: Navigating the Fusion of Traditional Finance and Innovative Infrastructure in Private Credit
36’49: Adapting to Shifts: The Impact of Changing Interest Rates on the Private Credit Landscape
40’16: Unlocking Potential with AI: How Proprietary Data Sets Are Shaping the Future of Finance
43’15: The channels used to connect with Nelson & learn more about Percent
Sneak Peek:
Nelson Chu:
Just to be fully transparent, we do kind of run two companies in-house or two businesses in-house, right? We have a marketplace business that really helped us get to where we are today, which is, it's done about, I would say maybe $1 billion and change in volume at this point. It has done over 550 deals. It's very, very active, and that's been over the course of the last 5 years, roughly, and that's been working out just fine for us, right? And the KPI for that is just strictly a UM, so what is it? We're in early March right now, 2024. We are tracking at about $170 million in a UM, which is totally fine. The broader private credit market is $1.7 trillion, so you can do the math as to what market penetration we have on that side, which is, again, totally fine, right? The marketplace has always been a means to an end for us to be able to learn how to do transactions at scale and at speed to be able to figure out we need to build on the software side.So, the other arm of our business is the software business, where we do provide the infrastructure to be able to source, structure, syndicate, service, and surveillance various different private credit opportunities, selling it as a pure play SaaS product to the later stage side of the market. That would be hopefully, over time, the Apollo's, Aries, Blackstone, KKRs of the world. That's our grail in terms of a client, but we're going to…
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