The Compound and Friends

It’s Only a Bubble If You Panic

60 snips
Oct 24, 2025
Sonali Basak, Chief Investment Strategist at iCapital and former Bloomberg finance correspondent, provides keen insights into the private credit landscape. She discusses recent scrutiny over private credit, particularly with bankruptcies like First Brands. The conversation covers the importance of manager disclosure, the growth of private credit since 2008, and the risks associated with it. Sonali highlights the appeal of data center leases and new niches in private credit, urging rigorous diligence for investors navigating these complex markets.
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INSIGHT

Private Credit Has Grown Into Many Niches

  • Private credit has expanded beyond direct lending into diverse niches like data centers and music royalties.
  • The industry now includes long-term leases and asset-backed lending, changing risk profiles.
INSIGHT

Data Center Loans Offer Contracted Cashflows

  • Hyperscaler-backed data center loans are often long-duration leases with inflation-linked cash flows.
  • Those contracts can be lower risk because cashflows are contracted and grow over time.
ANECDOTE

Roll-Ups Buy Salespeople, Not Durable Value

  • Josh Brown shares firsthand experience seeing wealth firms buy low-quality advisory businesses at high multiples.
  • He warns many roll-ups buy salespeople and fragile client relationships, not real enterprise value.
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