Beyond the Balance Sheet: Key takeaways from DLA Piper’s Private Credit and Fund Finance Summit

DLA Piper and the Opal Group recently co-hosted the second annual Beyond the Balance Sheet: The Future of Private Credit and Fund Finance Summit. The event convened industry leaders across private credit, fund finance, and structured finance to explore where these sectors are heading as private markets continue to converge and evolve.

Key findings from the discussions are highlighted below.

Private equity net asset value (NAV) financings gain momentum

Fund managers increasingly turn to private equity NAV financings when pursuing add-on acquisitions after a fund’s investment period has expired. These facilities offer portfolio companies the flexibility to act quickly on investment opportunities, while providing lenders risk-conscious returns.

Many limited partners (LPs) have also seen increased value in NAV financings. These structures can support post‑investment‑period deployments that enhance multiples on invested capital and offset fee drag. As NAV financings grow in popularity, lenders and managers are developing more sophisticated structures, often employing special-purpose vehicles below the fund level to avoid conflicts with subscription line facilities.

Rated feeder funds continue to evolve

Rated feeder funds are gaining traction as investors become more familiar with the structure, and as fund managers seek to broaden access to new areas of the private credit market. Managers are increasingly adopting creative approaches to marketing these vehicles, including segmenting investors into multiple tranches of debt and equity – each with distinct investment strategies – rather than offering traditional vertical slices.

As the market matures, both ratings agencies and limited partners are placing greater emphasis on fund manager track record and transparency. Once viewed as “black-box” investments, rated feeder funds are subject to heightened scrutiny of their ratings methodologies and underlying portfolio performance. In assessing risk, ratings agencies often weigh managers’ experience to account for eligibility and concentration considerations that may differ from those in traditional securitization structures. At the same time, agencies are expanding coverage to new asset classes as this segment continues to grow.

Geopolitical developments shape private credit strategy

Geopolitical uncertainty is affecting investment decisions across the private credit landscape. Lenders are selectively exploring opportunities arising from market disruptions, including measured participation in historically non core sectors.

At the same time, cross-border exposure is being re-assessed amid conflicts in the Middle East, tariffs, and broader macroeconomic pressures that affect investor interest. Fund managers are increasingly relying on data-driven analyses to evaluate regional and sector-specific risk, while international LPs are prioritizing stronger relationships with established managers over broader market diversification.

Continued innovation in fund finance structures

Within the fund finance market, separately managed accounts and hybrid facilities continue to gain popularity as sponsors and lenders seek customized liquidity solutions. Funds nearing the end of their investment periods are increasingly layering NAV facilities alongside subscription lines to support ongoing liquidity needs as asset bases mature.

Despite broader market shifts, fund finance remains borrower-friendly. While margin compression trends may stabilize, lenders offering longer tenors are experiencing success with early-stage funds. Lenders are also observing increased requests to incorporate term loans into facilities, thereby creating structures that resemble asset backed securities (ABS) for funds in their harvest periods. Subscription line facilities continue to be viewed as lower-risk investments due to conservative advance rates and experienced fund sponsorship.

Music royalties, private credit, and ABS attract growing investor interest

Music royalties are increasingly viewed as an attractive private credit and asset-backed finance opportunity, supported by stable, long-duration cash flows and low correlation to broader market cycles. Streaming platforms remain the primary revenue drivers, with investors relying on detailed consumption data to underwrite predictable cash flows and portfolio performance.

As the market matures, sponsors are deploying layered capital structures that combine private credit, bank financing, and ABS issuance. Higher-leverage private credit facilities are often used to support acquisition activity, with assets refinanced through securitizations once portfolios are seasoned and independently valued.

Despite growing attention to artificial intelligence-generated content, high-quality, human-created catalogs remain central to value creation, underpinned by long-term copyright protection, improved rights-tracking, and royalty-collection mechanisms.

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Access session recordings here. For additional information, please contact the authors.