Published 2026-03-05
Summary: Marathon Asset Management’s Bruce Richards warns that defaults among highly leveraged software borrowers could rise by about 15%, citing concerns over private credit exposure to software companies operating with roughly 10x leverage. The remarks come as part of commentary around private credit risk and the broader tech/software funding cycle.
What We Know
- Bruce Richards is chairman of Marathon Asset Management LP and serves as its CEO, according to available briefings.
- Richards has warned that 15% direct loan software defaults could occur, highlighting concerns about private credit exposure to software companies leveraged around 10x.
- The warnings were associated with discussions around private credit risk and software/software-enabled business models, with references to AI and its potential impact on investment theses.
- Coverage references a Bloomberg Invest conference context in New York as part of where Richards voiced these views.
What’s Still Unclear
- Whether the 15% figure refers strictly to direct loan defaults or another metric related to software lending remains unspecified in the available materials.
- Whether Richards’ remarks constitute a formal forecast or a general concern without a formal forecast needs confirmation from the original statements.
- Exact wording, date, and setting of Richards’ comments across sources vary; a precise transcript is not included in the provided materials.
- Whether all sources consistently report the magnitude of exposure to 10x leverage or if there are variations in the reported leverage levels.
Context
Contextual background involves private credit and the public scrutiny of risk in financing software-focused companies, particularly those valued or funded at high leverage. The conversation touches on how rising leverage and exposure to the software sector could affect default dynamics and credit risk in private markets, with AI considerations often cited as an overarching theme in tech financing.
Why It Matters
If defaults among highly leveraged software borrowers rise, it could influence private credit performance, affect liquidity in niche finance markets, and shape investor risk assessments around software-focused lending. The discussion underscores concerns about concentration risk in private credit portfolios and the potential implications for debt-servicing capacity in highly valued tech companies.
What to Watch Next
- Follow-up remarks or a formal statement from Marathon Asset Management regarding private credit risk in software lending.
- Broader market commentary on leverage trends in private credit for tech/software companies.
- Any new data or research on software sector default rates within direct loans or private credit exposures.
- Updates from Bloomberg Invest events or related conferences that contextualize Richards’ comments.
FAQ
Q: What is the main warning from Bruce Richards?
A: He warns that highly leveraged software borrowers could see default rates rise, with a figure cited around 15% in the context of private credit exposure to software companies using high leverage.
Q: Is the 15% figure a forecast or a concern?
A: The available materials indicate it as a warned rate or concern; whether it is a formal forecast is not confirmed in the provided sources.
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Source Transparency
- This article is based on a short preliminary brief and may not reflect the full details available in ongoing reporting.
- Source links are provided in the Sources section where available.
- A limited open-web check was used to clarify key details when possible; unclear items remain clearly marked.
Original brief: Marathon Asset Management Chair and CEO Bruce Richards explains why he thinks highly-leveraged software default rates could surge 15% alongside the #BloombergInvest conference in New York
http://
bloom.bg/3OMuZBO…
Sources
- Marathon's Richards: 10x Software Leverage Will Break – LinkedIn
- Marathon's Richards: 10x Software Leverage Will Break
- Marathon's Richards Fears 15% Direct Loan Software Defaults
- Marathon's Richards Fears 15% Direct Loan Software Defaults (1)
- Marathon's Richards Warns About Leveraged Software Defaults