Pub. 15 2020-2021 Issue 1

NEBRASKA BANKERS ASSOCIATION 21 arranged. This type of loan typically comes with a higher-than- normal interest rate based on investor risk. Bridge financing is arranged through partnership with an investment bank, which has connections to private debt, in- stitutional capital and alternate source lenders. Additionally, investment banks are able to bring sophisticated systems and deep market knowledge to the table. Think of this type of fi- nancing as a bridge that connects a company to capital through short-term borrowings. Who Provides Bridge Financing? Bridge financing is available through lenders with substantial amounts of cash who are looking for opportunities to put these funds to work. Here is a list of typical lending sources. Private Lenders — These are individuals or non-bank com- panies that are generally consideredmore aggressive than tradi- tional lenders. Private lenders fund a variety of loans, including those designated as bridge. An advantage is that they tend to have faster approval times than banks due to less regulatory scrutiny. Family Office Debt Funds — Family offices are privately held wealth management advisory firms that serve individuals and families generally with a net worth skyward of $100 million in investable assets. A primary role of family offices is to seek worthy debt fund investments on behalf of their clients. They often interface with investment banking firms and other outside managers to achieve capital gains for their clients. Private Debt Funds — Another alternative to traditional banks, private debt funds specialize in raisingmoney from inves- tors and lend it to companies for a variety of purposes includ- ing mezzanine financing, distressed financing, growth capital, merger and acquisition and other special situations funds. Who Qualifies for this Type of Capital? Forms of bridge financing are not recommended for startup businesses but instead for existing companies that can dem- onstrate the ability to make it through a temporary downturn. Established companies with good track records and experienced management teams generally can qualify for bridge financing without difficulty. In fact, lenders understand that this sort of capital is needed quickly and for a shorter period time than long-term leveraged debt options. Bridge financing is meant to alleviate immediate monetary pressures, allowing the company to focus on correcting opera- tional, financial or personnel deficiencies to emerge as a stronger organization and return to traditional financing with a bank.  Gary Grote is a 24-year veteran of Nebraska banking and now a managing director with Bridgepoint Investment Banking. For more information, contact Bridgepoint at 402-817-7940. Bridgepoint is a boutique investment banking firm that provides sophisticated, flexible and creative solutions to middle market companies, which typically are overlooked by Wall Street. In order to offer securities-related investment banking services discussed herein, and to include M&A and institutional capital raising, certain representatives of Bridgepoint Investment Banking are registered representatives of M&A Securities Group, Inc., an unaffiliated broker-dealer and member of FINRA/SIPC. This entity is not affiliated or associated with, authorized or sponsored by Bridgepoint Advisers Limited. Safer, More Efficient Management of the Appraisal Process MOBILE APPRAISAL SOLUTIONS • Safe Mobile Appraisal Solutions • Practice Social Distancing • Keep the Lender Pipeline Moving • Appraisal Report Delivered to Lender • Exterior Inspection by Appraisers – Homeowners Take Interior Photos Use Verisite’s Mobile Inspection Tools on purchase and refi loans and sub-loan products, such as home equity loans, disaster relief inspections, new construction progress evaluations, and portfolio reviews. Confirm completed insurance repairs and validate internal and external property conditions. Contact Lee Volmer | (402)714-0856 lee@creditinfosystems.com