New Investment Opportunity: Arrow Credit Opportunities Fund II

New Investment Opportunity: Arrow Credit Opportunities II
2023 European debt fund managed by leading loan service firm

Specialized structured credit fund with proprietary access through its loan servicing relationships in five European countries
Arrow is a leading European investor and asset manager in non-performing and non-core bank assets; Fund I has 19.4% deal level IRR, 24% gross IRR on drawn capital; loss rate under 1.5% as of Q3, 2022
European financial institutions keen to clear balance sheets of non-performing loans at discount as economic headwinds increase; Arrow well placed to select, acquire loans leveraging local knowledge from its servicing platform
€1.4B already raised; final close expected in Q1 2023 at €2.5B target
Fund II will be highly diversified fund across five countries, multiple sectors, with average loan value of €4M
Access to fund usually limited to institutions investing €20M or more
OurCrowd targeting investment of at least €10M of total $2.5B fund

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with your Investor Relations representative

Dear Josb,

Current market conditions in Europe, including a looming energy crisis and rising inflation, are creating a perfect storm for alternative lenders. Arrow Global, a leading Europe-focused private credit manager that purchases and resolves non-performing loans in five countries, is offering the chance to invest in Arrow Credit Opportunities (ACO) II, its second fund, which had a €1.3B first close in August.

OurCrowd is investing in Arrow Global ACO II. The details in this email are based on information received from, and verified solely by, Arrow Global.

The Opportunity
A looming energy supply crisis and rising inflation are buffeting banks and financial institutions in Europe. Lenders are eager to clear their balance sheets of non-performing loans and non-core banking assets.

Arrow Global has more than $70B of assets under management in the UK, Ireland, Portugal, Italy and the Netherlands. Through its deep knowledge of these local markets, Arrow is able to select small, off-market deals that lenders are seeking to unload, and bundle them into a specialized structured credit fund. Over 90% of the fund's portfolio is either fully or partially serviced on Arrow's own platforms, which provides important insight into the performance of the assets.

Loans average about €4M each and are highly diversified across Arrow's five countries of operation and multiple sectors. Loans are backed by primary asset collateral, mostly real estate. The fund will make quarterly capital calls and has an estimated three-year draw down on committed capital.

Access to such funds is usually limited to major investors writing checks of €20M or more. OurCrowd is able to offer investors the chance to participate in ACO II at a minimum investment of $250K, with capital calls. The initial capital call at closing will be 7%.

The Traction
Arrow has invested €7.9B in more than 1,000 deals since 2010 with an average 18% gross IRR and a loss rate below 1.5%.

As of Q3, 2022, ACO I has total realizations of €635M running at 1.5X underwrite value. This represents a deal level IRR of 19.4% and a gross IRR on draw capital of 24%.

ACO II had a first close of €1.3B in August, 2022.

The Team
Arrow Global distinguishes itself from other institutional funds in the market by acting as a vertically integrated asset manager with its own servicing platform as well as an investment platform. Arrow has 18 fully owned servicing platforms and ~2,500 employees operating in its five European geographies. The firm enjoys strong local client relationships and a significant level of local knowledge, leading to superior asset origination and underwriting capability across the target geographies. This represents a distinct and impressive moat that is difficult for new entrants to challenge or recreate.

Arrow's deep bench of professional managers has extensive experience on over 1,000 deals. CEO Zach Lewy has over 23 years of executive experience in NPL investment management and asset servicing. Lewy was the Founder and Executive Director of 7C Ltd., acquired in 2002 by Vertex (NASDAQ: VRTX), where he then served as President, North America. John Calvao, Managing Principal and Co-Head of Fund, is the former CEO of Zenith Service S.p.A., and former CEO of Whitestar Asset Solutions.

Fund investors will also benefit from Arrow Global's 47-person central investment team and the Sourcing and Servicing Platforms' team of 98 in-country investment experts.

The Round
OurCrowd aims to invest at least €10M in the fourth closing of the fund, scheduled for the end of 2022. There will be a further and final close in Q1 2023 in which Arrow expects to achieve its target for ACO II of €2.5B.

Meet the CEO
We're hosting a webinar/conference call on Wednesday, November 30th, at 7PM Israel / 12 Noon New York / 9AM San Francisco for investors to meet John Calvao and learn more about Arrow Global.

Can't make the webinar? Register and we will send you a recording of the call.

The Arrow Global Solution
Arrow Global distinguishes itself from other institutional funds in the market by acting as a vertically integrated asset manager with its own servicing platform as well as an investment platform. Arrow has built its credit servicing platform by acquiring market-leading credit-servicing businesses occupying at least a top-three position within geographies that have both a high NPL ratio and a high propensity for the local banks to sell non-performing and non-core assets. Arrow, therefore, possesses strong local client relationships and a significant level of local knowledge, leading to superior asset origination and underwriting capability across the target geographies.

Certain information in this email contains "forward-looking information" under applicable securities laws ("forward-looking statements"). These may include, among others, projected performance; expected development of the company's business, projects and partnerships; execution of the company's vision and growth strategy; and the like. Forward-looking statements are not guarantees of future performance and should not be relied on in any way.

Nothing contained in and accompanying this communication shall be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation to purchase any security by OurCrowd, its portfolio companies or any third party. Information regarding OurCrowd's limited partnerships and/or portfolio companies and the investment opportunities on OurCrowd's website is intended and available for accredited investors only (criteria at OurCrowd). OurCrowd urges potential investors to consult with licensed legal professionals and investment advisors for any legal, tax, insurance, or investment advice.