Private credit is rapidly becoming one of the most talked-about areas in the investment world. It offers investors access to yield and diversification outside traditional markets. To better understand what’s driving this growth and how investors can navigate the opportunities and risks, we sat down with Albane Poulin, Head of Private Credit at Gravis, to get her insights on the evolving landscape, the importance of careful structuring, and where she sees the most promising opportunities ahead. The video and transcript are below.
Getting smart about investing in credit
1. What exactly is “private credit” and how does it differ from a public bond?
Private credit refers to debt financing provided directly to companies or projects without going through the public bond market. Unlike public bonds, which are issued broadly to investors and actively traded, private credit is typically negotiated directly between the borrower and lender, held to maturity, and not traded on an exchange.
In the infrastructure space, this allows us to structure debt that matches the long-term, stable cash flows of essential assets. At Gravis we source and structure infrastructure debt transactions, ensuring returns are underpinned by predictable revenues rather than market sentiment, as is the case with public bonds.
2. For investors considering private credit for the first time: what fund or product features should they look for?
Investors should choose a manager with a strong track record in originating, structuring, and managing loans in the relevant asset class so they should look at their ability to deploy, track record in terms of return but also loss ratio. They should go for specialist, an expert in this particular asset class. It is particularly true for infrastructure as it can be quite complex and technical with a lot of acronyms.
Investors need to choose a manager with strong governance and transparency: our infrastructure debt strategies embody these principles. The annual report of our listed company is 180 pages long where we provide a detailed and transparent reporting on our assets. We can prove we have 15 years’ history of delivering consistent, uncorrelated returns through a diversified portfolio of essential assets
Investors should ensure there is alignment of interest with managers who have skin in the game. For example, in private credit, performance fees can encourage taking on additional risk. We believe GP commitment to the fund is a better way to align interests with investors.
3. What are the biggest risks people often overlook when considering private credit?
The main risk is the lack of liquidity. Investments are typically locked up for years, with no active secondary market so the overall asset class is more suitable for a ‘buy and hold’ portfolio. We mitigate other risks such as refinancing risk and underwriting risk through our specialism and deep knowledge of the sector, and disciplined structuring. We strategically select our position within the capital structure and choose to have senior debt, mezzanine, or equity, based on the specific sector and asset characteristics. We structure loans around the project’s value and cash flows. Our underwriting is very tied to the asset itself. Our bespoke financial solutions are tailored to align with the unique risk profile of each asset. We believe debt is a better place to enter into new sectors and technology as we are higher in the capital structure. As we get more comfortable, we move to mezz or equity.
4. What else should investors consider when it comes to private credit?
Beyond the search for yield, the real advantage is the ability to structure debt around the specific risks and cash flows of a project or company. In infrastructure, this means we tailor an amortisation profile, covenants, and security packages to align with the asset’s lifecycle. We have consistently shown that structuring debt intelligently enhances risk-adjusted returns and preserves capital. For example, we aim to match repayment schedules with contracted revenues. When there is some uncertainty on the long-term value of the asset, we include some amortisation to leave a project less geared at exit (so when the loan needs to be refinanced). It’s not just lending capital, it’s designing capital to fit resilient businesses. This flexibility often results in better returns than off-the-shelf financing from banks or public markets.
5. How do you see the role of private credit evolving over the next 1–3 years? What sectors are especially promising or under-served?
Private credit is increasingly filling the gap left by banks retrenching from long-term lending and borrower seeking flexible capital. In the next 3 years, we expect growing demand for infrastructure debt to finance the energy transition, digital infrastructure (data centres, towers), and social infrastructure such as healthcare and education. Gravis is already active in these areas, positioning us to capture this trend. Niche areas underserved by banks, like special situations or asset-backed lending may also present opportunities.
6. In the current macro environment what makes private credit more or less attractive than, say, high yield bonds or bank lending?
Private credit can offer attractive yields compared to high-yield bonds, reflecting both the illiquidity premium and the ability to negotiate protections. Compared with bank lending, private credit often provides more flexible and longer-term capital, filling the gap left by banks that have pulled back due to regulation or balance sheet constraints. Its appeal in today’s environment lies in delivering income that is less correlated to public market volatility.
Infrastructure debt, in particular, is attractive as these assets typically have contracted or regulated revenues that are less sensitive to the cycle, offering resilience. Gravis’s experience in sectors such as energy, social or mobility infrastructure demonstrates how well-structured private debt can provide investors with downside protection alongside competitive yields.
Investors are turning into the asset class when they focus on capital preservation and recurring income.
7. What epitomises what “smart investing in credit” looks like?
Investing in infrastructure is, in my view, a smart and resilient strategy. It allows investors to gain exposure to essential assets that often benefit from government support or long-term contracted revenues. This results in low volatility and low correlation with the broader economy or public markets.
Infrastructure debt also offers inflation protection, predictable cash flows, and strong capital preservation. For example, when we invest in rooftop solar, EV charging, onshore wind, or battery storage projects, we’re backing strategic assets that play a key role in the energy transition. That combination of financial stability and positive impact truly makes it a smart investment in my eyes.
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