Private Development Finance
A new public-private initiative to accelerate national development and support democracy in economically fragile nations
Private Development Finance
A new public-private initiative to accelerate national development and support democracy in economically fragile nations
We help companies finance transformational capital asset development initiatives.
We help companies finance transformational capital asset development initiatives.
The challenges corporations, entrepreneurs and governments face in this new age are unprecedented and daunting. With technology and environment-led disruption progressing at pace, legacy investment decisions are increasingly being relegated to the dustbin of sunk costs. Even the most established corporations and nations, as well as today’s most promising entrepreneur-led start-ups, are at risk of extinction.
Absent aggressive, large-scale investment into transformative new initiatives, companies and nations are, by default, checking themselves into the economic and commercial equivalent of a hospice.
New investment is no guarantee of survival. For as quickly as new transformational initiatives appear, they are at risk of disappearing, displaced by the next “big idea”. The “S-curve” is steepening as never before.
In this new age, every company is a perpetual start-up, every advanced economy at risk of losing its comparative advantages. At the same time, every start-up, every new market entrant has the potential to rapidly emerge as the incumbent. Every developing nation has the potential to become the next “tiger” economy.
This is an age of high risks and high returns. For corporations, entrepreneurs, governments willing and able to perpetually adapt, the opportunities may be boundless.
The challenges corporations, entrepreneurs and governments face in this new age are unprecedented and daunting. With technology and environment-led disruption progressing at pace, legacy investment decisions are increasingly being relegated to the dustbin of sunk costs. Even the most established corporations and nations, as well as today’s most promising entrepreneur-led start-ups, are at risk of extinction.
Absent aggressive, large-scale investment into transformative new initiatives, companies and nations are, by default, checking themselves into the economic and commercial equivalent of a hospice.
New investment is no guarantee of survival. For as quickly as new transformational initiatives appear, they are at risk of disappearing, displaced by the next “big idea”. The “S-curve” is steepening as never before.
In this new age, every company is a perpetual start-up, every advanced economy at risk of losing its comparative advantages. At the same time, every start-up, every new market entrant has the potential to rapidly emerge as the incumbent. Every developing nation has the potential to become the next “tiger” economy.
This is an age of high risks and high returns. For corporations, entrepreneurs, governments willing and able to perpetually adapt, the opportunities may be boundless.
The challenges corporations, entrepreneurs and governments face in this new age are unprecedented and daunting. With technology and environment-led disruption progressing at pace, legacy investment decisions are increasingly being relegated to the dustbin of sunk costs. Even the most established corporations and nations, as well as today’s most promising entrepreneur-led start-ups, are at risk of extinction.
Absent aggressive, large-scale investment into transformative new initiatives, companies and nations are, by default, checking themselves into the economic and commercial equivalent of a hospice.
New investment is no guarantee of survival. For as quickly as new transformational initiatives appear, they are at risk of disappearing, displaced by the next “big idea”. The “S-curve” is steepening as never before.
In this new age, every company is a perpetual start-up, every advanced economy at risk of losing its comparative advantages. At the same time, every start-up, every new market entrant has the potential to rapidly emerge as the incumbent. Every developing nation has the potential to become the next “tiger” economy.
This is an age of high risks and high returns. For corporations, entrepreneurs, governments willing and able to perpetually adapt, the opportunities may be boundless.
The challenges corporations, entrepreneurs and governments face in this new age are unprecedented and daunting. With technology and environment-led disruption progressing at pace, legacy investment decisions are increasingly being relegated to the dustbin of sunk costs. Even the most established corporations and nations, as well as today’s most promising entrepreneur-led start-ups, are at risk of extinction.
Absent aggressive, large-scale investment into transformative new initiatives, companies and nations are, by default, checking themselves into the economic and commercial equivalent of a hospice.
New investment is no guarantee of survival. For as quickly as new transformational initiatives appear, they are at risk of disappearing, displaced by the next “big idea”. The “S-curve” is steepening as never before.
In this new age, every company is a perpetual start-up, every advanced economy at risk of losing its comparative advantages. At the same time, every start-up, every new market entrant has the potential to rapidly emerge as the incumbent. Every developing nation has the potential to become the next “tiger” economy.
This is an age of high risks and high returns. For corporations, entrepreneurs, governments willing and able to perpetually adapt, the opportunities may be boundless.
The Market Need
Financial markets could benefit from a new type of financial market intermediary that efficiently and reliably bridges the low-risk preferences of the largest long-term capital markets investors to the moderate to high risk profile of technology-led disruptors.
Capital market investors
Increasing levels of capital intensity mean technology-led disruptors require more capital, earlier in their operating lives to build market share and achieve market dominance than was the case in the previous, 3rd industrial revolution.
Global debt markets represent one of the largest pools of long-duration liquidity, with issuance significantly greater than with equity markets. Global long-term capital market bond issuance in 2020 amounted to an estimated $27 trillion across all geographies; this compares to $0.8 trillion of equity issuance globally (SIFMA, 2022).
The extraordinary pool of capital that debt markets comprise is most readily accessible to borrowers assigned investment grade credit ratings. Since 1996, an estimated 80% of corporate bond issuance in the US, the world's largest, most sophisticated corporate bond market, has been by investment grade rated borrowers.
To access debt capital market liquidity in size, financial market intermediaries will need to achieve high standalone credit quality ratings. For this, they need to deploy new, scalable approaches to mitigating risk from lending to sub-investment grade borrowers. Highforest’s approach envisions creating three intergenerational loan portfolios—low, moderate and high risk—which can be engineered to create a self-insurance mechanism. This self-insurance mechanism can support high credit quality bank ratings, opening access to investment grade institutional global debt capital markets.
Financial
market
intermediaries
Technology-led
disruptors
Many technology-led disruptors assigned speculative and highly speculative standalone credit ratings do not have the sustainable debt capacity required to finance their investment plans using conventional debt instruments. They require new sustainable loan structures that allow them to manage bankruptcy risk, which can rapidly erode shareholder value. Highforest’s approach is to improve predictability in future debt service payments through fixed rate interest payments, do away with the need for loan repayment or refinancing until such time a disruptor turns cash flow positive—a milestone that may take decades to achieve—and introduce flexible interest payment terms that permit deferrals and payments in kind.