Participated · Debt Financing · Feb 2024

Pagaya Technologies builds AI-driven product solutions for the financial ecosystem, focusing on expanding its network of lending and investor partners. The company recently pre-announced full-year 2023 results with Network Volume exceeding $8.2 billion and Adjusted EBITDA above $75 million, implying an annualized run-rate Adjusted EBITDA of over $110 million based on Q4 2023. Pagaya plans to use new financing to invest in product innovation and grow its network with both existing and new lending and investor partners. In the prior four months it secured four new lending partners, including a top bank and a top auto captive, expected to drive transformational network expansion. The company emphasizes transforming the consumer finance ecosystem as it scales and extends its corporate debt maturity to 2029. Pagaya builds AI and advanced-analytics infrastructure to increase access to financial products and services across its network. The company leverages machine learning to power origination and credit solutions and has expanded via strategic acquisitions, including its January 2023 purchase of Darwin Homes to extend its SFR platform. Pagaya says it is pursuing further M&A to combine complementary, founder-led fintechs into a broader integrated offering. Management expects to be at the high end of or exceed its Q1 2023 guidance for Network Volume, Total Revenue and Other Income, and Adjusted EBITDA. Year-to-date the company has executed approximately $2.0 billion of capital raises in the asset-backed securitization market, and it reports an expanding and diversifying investor base. GIC has increased its investment and extended its fund agreement for three more years, supporting Pagaya’s growth plans. Pagaya is a fintech that uses machine learning and big data analytics via its Pagaya Pulse platform to manage institutional money, with a focus on fixed income and alternative credit. The firm offers a variety of discretionary funds to institutional investors, including pension funds, insurance companies, and banks. Since launching, Pagaya has grown to manage over $1.6 billion in assets and its total consumer credit ABS issuance has surpassed $1 billion. The company effectively reopened the consumer credit ABS market with a $200 million ABS fully managed by its AI and has completed seven ABS deals to date. Pagaya plans to use new investment to hire more data scientists, further develop its technology, and pursue new asset classes such as real estate, auto loans, mortgages, and corporate credit. The company was founded in 2016 and is headquartered in New York and Tel Aviv. Pagaya operates an AI-driven asset management platform (Pagaya Pulse) that applies machine learning and big data analytics to underwrite and manage fixed‑income and alternative credit assets. Its asset management team of 30 data scientists and AI specialists analyzes hundreds of millions of data points and economic and market data to perform bottom-up underwriting and risk assessment. Pagaya manages $450 million for banks, insurance companies, pension funds, asset managers and sovereign wealth funds. The company recently created a $100 million consumer credit ABS fully managed by AI. Pagaya plans to use new capital to further develop its technology and expand into new asset classes such as real estate, auto loans, mortgages and corporate credit. The company was founded in 2016 and has offices in New York and Tel Aviv. Pagaya applies machine learning and big-data analytics through its Pagaya Pulse platform to manage institutional capital, with a focus on fixed income and alternative credit. The company offers discretionary funds to institutional investors including banks, insurance companies, pension funds, asset managers and high-net-worth investors. Its algorithm analyzes millions of data points to assess risk, identify emerging alternative asset classes (for example, consumer credit lending) and seek excess returns. Pagaya plans to use new funding to further develop its proprietary algorithm, enter new data-rich asset classes, expand its roughly 20-person investment team of data scientists and AI specialists, build a global sales force, and launch new investment strategies. Financially, Pagaya manages $250 million in capital and recently closed a $75 million debt financing with Citi; it also hired Ed Mallon as Chief Investment Officer. The company was co-founded in 2016 and maintains offices in New York and Tel Aviv.