One of the most common questions we receive from investors is deceptively simple: should I invest in debt or equity? The answer, like most things in finance, depends on your objectives, risk appetite, and time horizon.
Secured Debt: Predictable Income, Capital Protection
Secured debt investments provide a fixed return backed by tangible assets — typically property, receivables, or business assets. Returns are predictable (typically 8–12% per annum), capital is protected by security, and income is distributed regularly (monthly or quarterly).
The trade-off is upside limitation. If the business doubles in value, your return remains fixed. But if the business struggles, your capital is protected by the underlying security — a fundamentally different risk profile from equity.
Equity: Higher Potential, Higher Risk
Equity co-investment means owning a share of the business alongside The Matt Haycox Group. Returns are driven by business growth and realised on exit (typically 3–5 years). Target returns are higher (20%+ IRR), but so is the risk — equity is subordinate to debt in the capital structure.
The Blended Approach
Many sophisticated investors choose a blended approach — allocating a portion to secured debt for predictable income and capital preservation, while deploying the remainder into equity for growth exposure. This creates a portfolio that generates current yield while maintaining upside potential.
