Loan Investments

Our Approach

We invest in portfolios of private loans made to businesses and individuals.  These include short‑term working‑capital loans, longer‑term notes used for equipment or expansion, and government‑guaranteed loans such as SBA 7(a) and 504 loans.  By acting as a lender, we earn interest and fees while helping businesses access the capital they need to grow.

Our credit team sources loans through direct origination and secondary market purchases.  Each loan is underwritten to assess collateral, cash flow, covenants and borrower creditworthiness.  We diversify across industries, loan sizes and maturities, with terms ranging from a few months to several years.  Interest and principal payments from these loans flow into Profit Prophet Capital’s earnings pool and are distributed to shareholders as dividends.

Benefits

• Steady income: Loans generate predictable interest payments that can provide a reliable stream of cash flow to investors.
   
• Variety of loan types: By mixing short‑term, long‑term and government‑backed loans, we balance liquidity and yield.  SBA‑guaranteed loans, for example, reduce credit risk because a portion of the principal is backed by the government.
   
• Control and protections: Loan agreements include covenants, collateral and reporting requirements that give lenders rights and remedies if a borrower’s performance deteriorates.
   
• Diversification: Private debt returns are less correlated with stock markets.  Adding a loan portfolio can smooth overall portfolio volatility.

All lending carries credit risk—borrowers may default on their obligations, especially during economic downturns.  Even with collateral and covenants, structural protections cannot assure a profit or eliminate the possibility of losses.  Loans are illiquid; you can’t sell them as easily as publicly traded bonds or stocks.  Interest rates may fluctuate, affecting the value of fixed‑rate loans.  Our job is to manage these risks through careful underwriting, active monitoring and diversification, but investors should understand that principal is not guaranteed.

We have a dedicated credit team with experience underwriting and managing private loans.  We spread risk across a portfolio of borrowers, industries and loan structures.  By combining short‑ and long‑term loans—including SBA‑guaranteed, senior secured and revenue‑based financing—we aim to capture attractive yields while maintaining disciplined risk management.  We charge no management fees; your returns come from the same loan interest and fees that we collect.  With regular reporting on loan performance, maturities and credit metrics, you’ll always know how your capital is deployed and what it’s earning.