LMM DL

LMM (Lower Middle Market) direct lending remains a viable space, but it has evolved significantly over the past decade. Based on the most helpful WSO content, the market has become more fragmented, and it's indeed harder to find standalone shops that aren't part of larger AUM platforms. Many direct lending players have scaled up or been absorbed into larger platforms, making the landscape more competitive and consolidated.

However, there are still opportunities in this space. LMM companies often require financing for various purposes, and direct lenders can step in where traditional banks have pulled back. The underwriting process and quality remain critical, as these deals often yield attractive returns (e.g., 9-10% with downside protection) but require careful risk assessment. Deal sourcing and manager selection are also key factors, as the space is highly dependent on these elements for success.

Sources: Alternative Lenders & the End of Risk Taking for Banks - Opportunity or Risk?, Best direct lending shops in Asia