Value Talks – Inbar Steiner hosts Galit Polonsky for a Conversation on Private Debt Funds

Podcast Summary

This episode explores the world of private debt, with a focus on illiquid credit, featuring Galit Polonsky of Menora. The discussion centers on the development of the sector in recent years, particularly in light of rising interest rates and changes in the banking system, which have fueled significant growth in private debt investments. The episode explains how institutional investors allocate capital to the space, the distinctions between direct investments and fund investments, and the process of manager selection. It also examines core strategies such as direct lending, alongside more complex alternatives like special situations and asset-based lending. The discussion also addresses key advantages of the asset class – such as consistent cash flow, an illiquidity premium, and robust contractual protections – alongside its risks and complexities, including the critical importance of manager selection. Finally, the episode addresses broader macro trends, such as private debt funds replacing traditional banks, the growing influence of institutional investors, and the expansion into global markets and emerging sectors.