[quote=flu]Dude, I’d be happy to commit some capital just to break even if it would mean I could learn some of the ropes in something completely different other than software software software. I’d be interested just to tag along to see how things work. Playing in commercial paper in a larger scale isn’t something that I would just try to “learn on my own”. Allan, if you are going to do this, and I’d be interested too.[/quote]
FLU: You hit on a very important aspect and that is making sure all of the structure is in place to do this right.
When my buddy Rob and I were in the factoring business, we had access to guys, including attorneys and CPAs, that did it for a living. They were happy to help, largely because we paid them for their expertise and cut them into some of the larger deals.
There is a lot of commercial paper out there, in everything from Commercial RE to auto loans to sub- and non-performing loans at banks and finance institutions. The problem is in assessing the toxicity of the paper and you really need to have the proper tools, resources and access to specialists to avoid getting burned and burned badly.
I like factoring and asset based lending because I understand it and have some experience with it, but the risk factors and potential downside are a couple of orders of magnitude worse than when I participated in this market before.
Like I said, I think there is big upside, but that also means you can lose your ass.
