Phoenix and Texas Capital Forge New Path for Middle-Market Finance

DALLAS, TX – June 30, 2026 – In a strategic move signaling a significant evolution in private credit, independent alternative asset manager Phoenix Merchant Partners and Texas Capital Alternative Asset Management (TCAAM) today announced a partnership designed to channel capital into the economy's often-overlooked engine room: the core middle market. The collaboration will launch Spurstone Credit, a perpetual-life credit fund, in the third quarter of 2026, aiming to bridge a structural financing gap that has long constrained founder-led and family-owned enterprises.

This alliance is more than just another fund launch; it represents a new playbook for originating and deploying private credit. By combining the deep, regional client network of a full-service financial institution with the specialized structuring expertise of an alternative asset manager, the venture tackles one of the biggest challenges in the burgeoning private credit landscape: finding and funding high-quality businesses that fall outside the traditional private equity ecosystem.

The Widening Chasm in Business Lending

The opportunity that Phoenix and Texas Capital are targeting is not a fleeting market niche but a deep structural fissure in the American financial system. The U.S. middle market—a vast segment of nearly 300,000 businesses generating over a third of private sector GDP—has become increasingly underserved. Following the 2008 financial crisis, heightened regulatory frameworks like Basel III made it less economical for traditional banks to hold mid-sized corporate loans on their balance sheets, causing a steady retreat from what was once their core territory.

Private credit, now a nearly $1.7 trillion global market, surged to fill this void. However, the flood of capital has largely concentrated at the upper end of the market, chasing larger, private equity-sponsored deals. This has created a hyper-competitive environment where mega-funds battle for dominance, often leading to tighter spreads and weaker covenants. Meanwhile, the core middle market—particularly the more than 90% of firms that are non-sponsored, family-owned, or founder-led—has been left behind. These businesses, often seeking flexible, non-dilutive capital for growth or acquisitions, find themselves too large for small business loans but too small or idiosyncratic for the mega-funds.

This is the “critical structural liquidity gap” Spurstone Credit is designed to fill. By focusing on companies with annual revenues between $100 million and $1 billion, the fund targets a segment rich with opportunity but starved of appropriately structured capital.

A New Playbook for Private Credit

The partnership's true innovation lies in its symbiotic structure. Texas Capital, as the only full-service financial services firm headquartered in the state, brings an invaluable asset: a vast, proprietary origination network. Its corporate and investment banking arms have established relationships with precisely the kind of founder-led businesses that Spurstone aims to serve, not just in Texas but across key economic centers like California, New York, and Illinois.

This solves the primary dilemma facing many private credit managers today: sourcing unique, high-quality deals outside of competitive, broadly-marketed auctions. As Art Mbanefo, Founder and CEO of Phoenix Merchant Partners, stated, “Proprietary origination remains the single biggest differentiator in the private credit landscape. Working with TCAAM unlocks unparalleled access to high-quality, founder-owned businesses.”

Phoenix, in turn, contributes the sophisticated structuring and disciplined underwriting essential for navigating this segment. Its expertise in tailoring senior secured financing solutions provides the flexibility that family-owned businesses require without demanding the equity stakes that founders are often reluctant to give up. This alignment of capabilities was underscored by Daniel Hoverman, Head of Corporate & Investment Banking at Texas Capital and President of TCAAM.

“The Phoenix team shares our disciplined approach to asset structuring, capital preservation and portfolio management, as well as our passion for providing exceptional client service and delivering comprehensive solutions,” Hoverman noted, emphasizing the cultural and strategic fit between the two organizations.

Structuring for a Niche Market

Spurstone Credit's design as a perpetual-life, non-traded closed-end credit fund is itself a strategic choice tailored to its mission. Unlike traditional fixed-term funds, a perpetual or “evergreen” structure provides long-term, stable capital, aligning the fund's timeline with the multi-generational horizons of many of its target companies. Being non-traded, it avoids the volatility of public markets, allowing for a focus on fundamental credit performance.

The fund’s mandate to deliver senior secured financing places it at the top of the capital stack, prioritizing capital preservation—a key consideration for the institutional anchor investors who have already shown strong interest. For the borrowing companies, this means access to patient, non-dilutive capital essential for funding organic growth, making strategic acquisitions, or optimizing their balance sheets without ceding control.

The fund will be advised by Ryestone Advisors LLC, a newly formed, Phoenix-sponsored entity currently registering with the U.S. Securities and Exchange Commission. TCAAM’s position as a minority economic investor in the adviser solidifies the long-term alignment of interests, ensuring both partners are invested in the fund’s success.

Dallas Cements Its Role as a Financial Powerhouse

The decision to headquarter Spurstone Credit in Dallas is a testament to the city’s accelerating emergence as a vital hub for financial services and alternative asset management. The move reinforces a broader trend of financial talent and capital decentralizing away from traditional coastal centers. Dallas offers a pro-business environment, a deep pool of talent, and close proximity to the vibrant Texas economy, which is home to a significant number of the middle-market companies the fund seeks to support.

This launch is more than a single corporate event; it is a data point confirming the strategic redistribution of financial power across the United States. As regional banks and specialized managers continue to innovate, models like the Phoenix-TCAAM partnership are poised to become a defining feature of the 2026 financial landscape, reshaping how capital flows to the real economy and creating a new competitive advantage for those who can successfully navigate the intersection of institutional scale and local market intelligence.