Buttonwood Asset Management
Small Business Income Fund 1
As the name implies, Small Business Income Fund 1 (“the Fund”) invests in small business loans, including working capital, inventory and equipment finance loans. Its primary objective is to achieve superior risk-adjusted returns, in comparison to other fixed-income investment opportunities. Blue Bridge Financial, a key asset in the Buttonwood portfolio, originates and services a majority of loans for the Fund.
Investors in the Fund will benefit from:
- Favorable purchase terms
- Reduced servicing fees
- Enhanced returns through the periodic sale of loans
- Targeted yield of 12% on an unlevered basis
The Fund occupies a niche position in a market underserved by banks, and offers investors access to the type of assets typically reserved for larger institutions. This is the first in a series of funds that Buttonwood plans to sponsor as its portfolio of companies expands.
Fund Management and Strategy
Buttonwood Asset Management LLC, (”BAM”) a Delaware limited partnership and wholly-owned subsidiary of Buttonwood Capital Management, is the Fund’s General Partner. Tom Scott, President of Buttonwood Asset Management and Managing Partner at Triton Pacific Capital Partners, LLC, serves as the Fund Manager.
The Fund consists of loans with attractive yields and strong credit quality. It seeks to minimize the volatility of returns and correlation to other asset classes. BAM will purchase the loans for Small Business Income Fund 1 from Blue Bridge Financial, a subsidiary majority owned by the principals of Buttonwood Capital. Blue Bridge will also service a vast majority of these loans. Investors will benefit from the relationship between BAM and Blue Bridge Financial.
Blue Bridge, a financing company that offers a variety of loan products to small and medium-sized businesses, originates loans directly with business owners, and indirectly through well-established Vendor and Broker programs. It has relationships with some of the nations’ leading vendors, especially in the hospitality, transportation and music industries. To date, Blue Bridge has originated over $120 million in comparable assets. Approximately $85 million have currently been sold, to a broad spectrum of well-known fund investors and depository institutions.