In a fireside chat that revealed a critical gap in Asia’s financial ecosystem, Sam Plagnard, founder of 𝜏-PAM, detailed how Net Asset Value (NAV) financing is emerging as the indispensable solution for private equity funds, LPs, and asset managers facing a prolonged liquidity drought.

Drawing on 25 years of banking experience in Asia, Plagnard explained why traditional lenders failed and how his firm is building a new market from the ground up.

Here are the key topics and takeaways for GPs, LPs, and investors navigating Asia’s complex private markets.

The Asian Liquidity Crisis: Why Banks Can’t Help and Secondaries Are Painful

Plagnard framed a stark reality for Asian private markets: a severe lack of liquidity options.

• The Banking Blockade: As a former banker, he experienced firsthand the frustration of being unable to lend against high-quality private fund portfolios due to rigid regulatory and compliance frameworks.

• The Secondary Market “Onerous Alternative”: With distribution rates down ~25% and holding periods lengthening, the secondary market often forces sales at “sharp discounts,” sacrificing future upside. NAV financing, he argued, provides liquidity without giving up the asset’s potential.

• A Massive, Underserved Need: This creates a “huge buy market” for providers like 𝜏-PAM, addressing urgent liquidity needs from both GPs (for growth capital, follow-ons, or bridging to exits) and LPs (facing liability calls or new fund commitments).

The 𝜏-PAM Advantage: An Investor’s Mindset, Not a Lender’s Playbook

Plagnard outlined why specialized, independent capital is crucial in Asia, and how 𝜏-PAM’s approach differs from both banks and large multi-strategy funds.

• 1. Independence as a Core Strength: Being a pure-play, independent NAV lender mitigates conflicts of interest. Borrowers can share sensitive portfolio data without fear of it advantaging a competing investment arm.

• 2. Underwriting the GP, Not Just the Collateral: “The first order risk… is the GP itself.” 𝜏-PAM acts like an investor, conducting deep due diligence on the fund manager’s track record, team stability, and skin-in-the-game before analyzing the portfolio. This “agency risk” assessment is paramount.

• 3. Bespoke Flexibility & Speed: Unconstrained by bank bureaucracy, 𝜏-PAM can structure creative, tailor-made solutions and move quickly. “We don’t have a template term sheet. We always start from a blank sheet.”

The Three-Pronged Origination Strategy: Education is King

In a region where NAV financing is nascent, building the market is part of the business. 𝜏-PAM’s origination relies on:

1. GP Direct Outreach: Leveraging the team’s deep, decades-long regional network.

2. Advisor & LP Referrals: Sophisticated LPs, in particular, can be powerful allies, reassuring GPs that pursuing NAV financing is a legitimate strategy.

3. Market Education = Origination: “In Asia, lagging big time… education means origination.” Publishing white papers and participating in conferences generates reverse inquiries and provides valuable market data. “Each time we are getting a bit visible… we are generating multiple reverse inquiries.”

Key Red Flags and the Succession Imperative

Plagnard highlighted critical deal-breakers during underwriting:

• Lack of Control: A GP with only minority, passive stakes in its portfolio is a significant negative.

• Over-Concentration: A portfolio concentrated in just a few assets limits financing capacity.

• The Succession Question: A clear succession plan for the GP’s leadership is vital. Interestingly, Plagnard noted that NAV financing can itself be a tool to fund GP-level transitions or expansions.

The Future of Asian Asset Management: Consolidation and NAV-Led Growth

Plagnard’s outlook for Asia’s private markets is one of transformation driven by liquidity needs:

• Consolidation in Private Equity: GPs unable to raise new funds due to poor distributions from past vintages will struggle to survive, leading to mergers or portfolio buyouts.

• The Rise of Asset-Based Financing Over Direct Lending: He is skeptical about the scalability of traditional Western-style direct lending in Asia’s fragmented markets. Instead, he predicts the rise of portfolio-level, asset-based financing like NAV loans as the dominant credit strategy.

• Infrastructure’s Bright (But Expensive) Future: The sector will see a “big push,” though high valuations in markets like India may correct. NAV financing will be key to providing growth capital and supporting fundraising.

• Explosive Growth Forecast: With Asia lagging 5-10 years behind the West, Plagnard sees NAV financing following the trajectory of subscription line facilities—moving from minimal usage to near-universal adoption. The market could see 30%+ CAGR, reaching hundreds of billions by 2030.

Key Takeaways for the Industry:

• For Asian GPs & LPs: NAV financing is no longer a niche tool but a strategic necessity for portfolio management and liquidity. The key is finding a partner that understands alignment and can structure bespoke solutions.

• For Investors: NAV financing offers a “value approach” to gaining Asian exposure—providing senior secured returns with a focus on downside protection—rather than a pure growth-equity bet.

• The Bottom Line: As Asia’s private markets mature and grapple with exit bottlenecks, NAV financing is poised to become the central nervous system for liquidity, enabling growth, facilitating transitions, and preventing the value destruction of fire sales. Firms that master its nuances will define the next chapter of Asian finance.

Key timestamps:

00:07 Introduction
01:59 Launch of 𝜏-PAM: A New Era in NAV Financing
03:38 Differentiating Factors in NAV Financing
06:16 Flexibility and Speed in Financing Solutions
09:59 Origination of NAV Financing Deals
13:09 Underwriting Process and Risk Assessment
16:54 Addressing Succession Issues in GP Financing
19:33 Evolution of Asset Classes in NAV Financing
22:14 Liquidity Challenges in the Current Market
25:53 Future of Asset Management in Asia
28:48 Conclusion and Closing Remarks