What is securitization, and why should you care?
It’s not as complicated as it sounds, we promise.
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We get it, securitization isn’t exactly a hot topic at dinner parties. It’s one of those finance terms that sounds complicated, but in reality, it’s reshaping how investors access private markets.
Securitization transforms complex, illiquid assets into tradable securities, unlocking faster, more flexible investment opportunities. With Yooro, the process is seamless, cutting through the red tape so investors can move smarter and scale faster.
For family offices, wealth managers, investment arrangers, and private banks, securitization is changing the way private markets work. Here's how.
Let’s start with the basics. What exactly is securitization?
At its core, Yooro’s securitization service is all about simplifying the process of investing in complex, hard-to-access assets, like real estate, venture capital, or even physical commodities. Traditionally, these markets have been a maze of paperwork, long waits, and hefty costs, often requiring a handful of intermediaries.
Now, instead of navigating that maze, you get a fast pass. Yooro provides a streamlined, tech-driven solution that’s efficient, transparent, and, dare I say, fun to use.
So, what exactly happens when you securitize an asset? Imagine you have an investment in real estate, but instead of holding it in its original, complicated form, you ‘wrap’ it into a neat, tradable security.
Think of it like turning a real estate investment into a digital ticket - one that can be bought, sold, and held like a stock or bond, minus the usual headaches.
Now, let’s talk about what this means for the key players in the financial ecosystem.
For Family Offices: More flexibility, more control
Let’s say you’re a family office juggling multiple mandates. Typically, investing in venture capital or real-world assets (RWAs), such as real estate or other physical assets, requires a separate agreement for each mandate. Time-consuming and costly, right? With Yooro, you can streamline all of that through a single feeder security. One transaction, multiple clients. No more repetitive paperwork, and fewer costs.
For families looking ahead, Yooro makes succession planning a breeze. Instead of getting tangled up in complex trust structures, you can simply securitize assets and have them tied to transferrable, custody-ready debt securities. This allows family members to easily manage and pass down ownership with ease.
Lastly, securitizing assets opens up new doors for enhanced collateral potential. Let’s say you’ve got private market assets that aren’t under custody yet. With Yooro, you can transform these assets into securities that can be used as collateral for lombard loans. This boosts your options with lenders, possibly even improving loan terms.
For Wealth Managers & Fiduciaries: A simpler, more transparent approach
Wealth managers and fiduciaries, this one’s for you. You’re the bridge between clients and investments, and you need tools that keep things running smoothly. Securitization lets you offer your clients access to private market investments through a single security. No need for multiple contracts, just one neat, tidy package that works for all your clients, across various mandates.
Transparency is key here. By transforming assets into securities, you can present your clients full clarity on fees, performance, and terms. You can even introduce additional subscription or performance-based fees for your services, keeping everything above board.
Securitising assets also allows you to maintain Assets Under Management (AUMs). Instead of having assets that can’t be held in custody (and therefore can’t be counted toward AUM), you can now offer securities that stay within your mandate, keeping the management fees flowing.
For Investment Arrangers: Greater flexibility and liquidity
For investment arrangers, you’re probably thinking: “How do I get my clients to easily invest in the amazing private investment opportunity I identified while keeping things straightforward?”. Well, by securitizing private market investments, you can offer a product that’s more easily purchasable to a wider range of investors. It’s no longer an obscure, complex investment, but rather a custody-ready, tradable security that anyone can access via bank or in tokenized format.
When it’s time to review and negotiate the investment terms, the process is seamless. With Yooro handling the operational complexities around both investment and divestment, you can focus on finding investors with the confidence that a seasoned team is taking care of the structuring.
For Private Banks: Keep the AUMs, keep the fees
Private banks, like wealth managers, often face challenges when dealing with private markets investments, particularly given that these assets can’t be held in custody. Yooro’s solution helps solve this problem by enabling banks to securitize assets and keep them under custody. This ensures AUMs remain intact while allowing continued management fees and ongoing client service.
Securitization also makes assets more attractive to lenders. By transforming investments into securities, you create something that’s easier to value, liquidate, and use as collateral. So when it comes time to secure loans, you’ve got an edge, and possibly better loan terms for your clients.
The bottom line
At the end of the day, Yooro’s Securitization offering democratizes access to private markets by transforming traditionally complex, opaque investments into something transparent, secure, and easily tradable.
Whether you’re a family office, wealth manager, investment arranger, or private bank, the benefits are clear: lower costs, increased flexibility, and enhanced transparency.
Securitization is the ultimate solution for anyone looking to simplify, accelerate, and unlock smarter investment opportunities in global markets. It’s efficient, it’s transparent, and it’s the future.
Stay tuned for more insights from the Yooro team on how we’re transforming the world of private markets.
