VALUATION, CONFLICTS AND FINAL ASSESSMENT
Private structured-credit portfolios create valuation questions because many positions do not trade every day. Managers may use broker quotes, discounted cash-flow models, third-party valuation services or observable comparable securities. Small changes in default, prepayment or recovery assumptions can materially alter fair value, particularly for junior structured-credit positions. LPs should understand who marks assets, how independent pricing is used and how valuation exceptions are handled.
Another area for diligence is related-party or platform overlap. A large asset-backed manager can source assets from originators, finance companies and public or private vehicles with which it has ongoing relationships. Investors should review Form ADV conflict disclosures, allocation policies and whether one Waterfall fund may buy from, sell to or finance another affiliated vehicle.
Waterfall's regulatory identity is substantially stronger than that of a newly formed credit manager. Its adviser has been SEC registered for many years; the founders have decades of asset-finance experience; historical Form D filings repeatedly identify Waterfall as Investment Manager; the firm operates across New York, London and Dublin; and approximately 90% of its clients are institutional according to the firm. As of March 31, 2026, its own website reports $12.1 billion of AUM and roughly 150 employees.
Those facts establish institutional scale, but they do not prove every Waterfall fund has the same historical returns or risk profile. The relevant diligence unit remains the exact fund or mandate. Investors should request current audited financial statements, gross and net performance, NAV, drawdowns, leverage, sector exposure, vintage composition, delinquency and default rates, realized recoveries, liquidity terms, side-pocket policy, management fees, incentive allocation, high-water mark, subscription-line usage and full counterparty exposure.
For structured-credit strategies specifically, investors should ask how much return came from contractual coupon versus leverage, spread compression, distressed recoveries or trading gains. A fund can post strong returns during improving credit markets while carrying materially more downside in a recession than headline volatility suggests.
The core conclusion is that Waterfall Asset Management is a long-established, SEC-registered specialist in asset-backed finance with a current company-reported AUM of approximately $12.1 billion and a platform extending across structured securities, whole loans, private asset-backed credit and related real-asset strategies. Its regulatory and operational footprint is substantial and independently verifiable.
The key question for investors is not whether Waterfall exists.
It is which Waterfall strategy they are entering, what collateral it owns, where that exposure sits in the capital structure, how much leverage is employed and how the fund behaves when defaults, spreads and liquidity deteriorate simultaneously.
SEC registration of Waterfall Asset Management confirms a regulated investment-adviser relationship.
Form D confirms exempt offerings by individual private funds.
Neither constitutes SEC approval of Waterfall, its funds, asset valuations, credit models or future investment performance.
SEC SNAPSHOT
REVIEWED BRAND: Waterfall Asset Management
LEGAL ADVISER: Waterfall Asset Management, LLC
FOUNDED: 2005
FOUNDERS: Jack Ross Tom Capasse
CURRENT ROLES: Jack Ross — Co-Managing Partner Tom Capasse — Co-Managing Partner
HEADQUARTERS: 1251 Avenue of the Americas 50th Floor New York, NY 10020
ADDITIONAL OFFICES: London Dublin
CURRENT COMPANY-REPORTED AUM: $12.1 billion
AUM DATE: March 31, 2026
EMPLOYEES: Approximately 150
INSTITUTIONAL CLIENT MIX: Approximately 90%
ASSET-BACKED SECTORS: 60+
Waterfall Asset Management, LLC
SEC FILE: 801-65087
REGULATORY STATUS: SEC Registered Investment Adviser
FORM ADV ADDRESS: 1251 Avenue of the Americas 50th Floor New York, NY 10020
PRIMARY STRATEGIES:
Structured Credit Asset-Backed Securities Whole Loans Private Asset-Backed Credit Residential Loans Consumer Credit Commercial Real Estate Credit Small-Balance Commercial Loans Specialty Finance Selected Private Equity Commercial Real Estate Equity
INVESTMENT STRUCTURES:
Evergreen Funds Drawdown Funds Commingled Vehicles Single-Investor Mandates Publicly Traded Credit Privately Negotiated Credit
HISTORICAL FLAGSHIP:
Waterfall Eden Fund LP
JURISDICTION: Delaware
CLASSIFICATION: Hedge Fund Pooled Investment Fund
INVESTMENT COMPANY ACT: Section 3(c)(7)
GENERAL PARTNER: Waterfall Management, LLC
INVESTMENT MANAGER: Waterfall Asset Management, LLC
RELATED FOUNDERS: Tom Capasse Jack Ross
IMPORTANT: Eden is one Waterfall strategy and should not be used as a proxy for every Waterfall fund.
REAL ESTATE EQUITY VEHICLE:
Waterfall Atlas Fund LP
CIK: 0001941965
JURISDICTION: Delaware
LAUNCHED: 2022
GENERAL PARTNER: Waterfall Atlas GP, LLC
INVESTMENT MANAGER: Waterfall Asset Management, LLC
RELATED PERSONS: Tom Capasse Jack Ross Kenneth Nick Other Waterfall executives
STRATEGY: Commercial Real Estate Equity
PRIVATE ASSET-BACKED CREDIT:
STRATEGY LAUNCHED: 2025
INITIAL LP COMMITMENTS REPORTED: More than $252 million
FOCUS: Private asset-backed credit opportunities
PUBLIC VEHICLE HISTORY:
Ready Capital
NYSE TICKER: RC
WATERFALL TIMELINE: Public trading began in 2016 according to Waterfall.
2016 ASSETS: More than $500M according to Waterfall timeline.
2023 CAPITAL: Approximately $2.8B according to Waterfall timeline.
IMPORTANT: Ready Capital is a separate listed company and its assets should not be added to Waterfall private-fund AUM.
KEY CURRENT INVESTMENT LEADERS:
Keerthi Raghavan Partner Co-CIO
Brian Rebello Partner Co-CIO
Chris Bigos Managing Director North America Private Asset-Backed Credit
James Cuby Partner Head of Europe
Akshay Dave Managing Director Corporate Credit
Jason Ebert Managing Director Co-Head of Residential Loans
John Griffin Managing Director Co-Head of Residential Loans
Hannah Hausmann Managing Director Consumer & Esoteric Credit
Zach Liebmann Partner Head of CRE
Dimitris Paralikis Managing Director Europe Private Asset-Backed Credit
Leo Wong Partner Head of Loan Strategies
BUSINESS LEADERS:
Kenneth Nick Partner Chief Operating Officer General Counsel Chief Compliance Officer
Brian Breakstone Partner Chief Financial Officer
Alex Kreydin Chief Risk Officer
Shehzad Nabi Chief Technology Officer
Russ Andrews Partner Co-Head of Business Development
Sharon Eliran Managing Director Co-Head of Business Development
PLATFORM HISTORY:
2005: Waterfall founded. Flagship high-yield asset-backed credit strategy launches.
2007: Flagship loan strategy launches.
2011: Standalone small-balance commercial loan strategy launches.
2015: Waterfall surpasses $5B AUM.
2016: London office opens. Ready Capital begins NYSE trading.
2017: Lower-middle-market financial-services private equity strategy launches.
2021: Waterfall surpasses $10B AUM.
2022: Commercial real estate equity / Atlas strategy launches. CUSIP dislocation strategy launches.
2023: Ready Capital reaches approximately $2.8B capital according to Waterfall.
2025: Private Asset-Backed Credit Fund launches with $252M+ LP commitments.
2026: Waterfall reports $12.1B AUM as of March 31.
IMPORTANT SCALE DISTINCTION:
$12.1B = Waterfall company-reported AUM as of March 31, 2026.
$252M+ = Initial commitments reported for the 2025 Private Asset-Backed Credit Fund.
Ready Capital capital/assets = Separate public-company figures.
Waterfall Eden Fund = Separate private fund.
Waterfall Atlas Fund = Separate CRE equity vehicle.
Do not combine these numbers.
WEBSITE / ENTITY PENETRATION:
Official website — CONFIRMED 2005 founding — CONFIRMED Founders — CONFIRMED $12.1B 2026 AUM — CONFIRMED BY WATERFALL ~150 employees — CONFIRMED BY WATERFALL ~90% institutional clients — CONFIRMED BY WATERFALL SEC RIA status — CONFIRMED CRD 137746 — CONFIRMED SEC 801-65087 — CONFIRMED Waterfall Eden Fund — CONFIRMED Waterfall Atlas Fund — CONFIRMED Waterfall as Investment Manager — CONFIRMED Private Asset-Backed Credit launch — CONFIRMED Ready Capital historical relationship — CONFIRMED BY WATERFALL Current fund-by-fund returns — NOT PUBLICLY ESTABLISHED Current leverage by private fund — REQUIRES FUND DOCUMENTS Exact current portfolio exposures — REQUIRES FUND REPORTING
CORE INVESTOR QUESTIONS:
Which exact Waterfall fund or mandate am I investing in Is it evergreen or drawdown What asset classes dominate current NAV How much exposure is consumer, residential, commercial real estate or specialty finance What percentage of the portfolio is publicly traded versus privately negotiated How much is whole-loan exposure How much is structured securities What percentage is senior versus mezzanine or subordinate What is gross leverage What is net leverage What warehouse or repo financing is used Which financing counterparties are largest What collateral haircuts can trigger margin calls What are historical default rates What are historical recovery rates What percentage of loans are delinquent How are privately held assets valued Who provides independent pricing How frequently is NAV calculated What is the largest sector concentration What are the largest originator and servicer exposures What backup servicers are available What is current duration How sensitive is NAV to rate changes How sensitive is NAV to spread widening What is maximum historical drawdown How much return historically came from leverage What management fee applies What incentive fee or allocation applies Is there a high-water mark What redemption frequency applies What gates or suspensions are permitted What side-pocket provisions exist What conflicts exist among Waterfall-affiliated vehicles How are investments allocated among funds What is the current auditor Who is the administrator What derivatives and hedging instruments are used
CORE RISKS:
Consumer credit defaults Mortgage credit risk Commercial real estate stress Specialty-finance underwriting Whole-loan illiquidity Structured-credit subordination Prepayment risk Extension risk Servicer risk Originator risk Collateral deterioration Interest-rate risk Spread widening Repo / warehouse leverage Margin calls Counterparty risk Model risk Private-asset valuation Liquidity mismatch Redemption restrictions Concentration by sector or originator Regulatory changes Economic recession Fund-level conflicts Management and incentive fees
INDEPENDENT CONCLUSION:
Waterfall Asset Management has one of the deeper institutional and regulatory footprints among specialist U.S. asset-backed credit managers.
Its evidence chain includes:
A 2005 founding. Two founders with decades of structured-credit experience. SEC registration. CRD 137746 / SEC 801-65087. Approximately $12.1 billion of AUM as of March 31, 2026. Approximately 150 employees. A roughly 90% institutional client base. Exposure across more than 60 asset-backed sectors. Long-running hedge-fund and loan strategies. A dedicated commercial-real-estate equity strategy. A newer private asset-backed credit strategy. Historical public-market experience through Ready Capital. And SEC filings that directly identify Waterfall Asset Management as Investment Manager of specific private funds.
This strongly establishes the platform's institutional identity.
The central diligence issue is therefore not whether Waterfall exists.
It is the exact risk embedded in the specific pool of assets an investor is buying.
Two Waterfall funds can have radically different economics depending on whether they own senior ABS, subordinate structured credit, residential whole loans, small-balance commercial loans or commercial-real-estate equity.
Investors should therefore move beyond brand-level AUM and obtain asset-level concentration, leverage, default, recovery, liquidity and valuation information for the exact fund.
SEC registration confirms Waterfall Asset Management as a registered investment adviser.
Form D confirms exempt private securities offerings by individual Waterfall funds.
Neither represents SEC approval, endorsement of the collateral, validation of fund NAV or a guarantee against credit losses.
PRIMARY EVIDENCE REVIEWED:
U.S. SEC Form ADV Waterfall Asset Management, LLC CRD 137746 SEC 801-65087
Waterfall Asset Management official website Firm profile $12.1B AUM as of March 31, 2026 Employee count Institutional-client mix Investment strategy
Waterfall Asset Management official history 2005-2026 strategic milestones
U.S. SEC EDGAR Waterfall Eden Fund LP CIK 0001340264
U.S. SEC EDGAR Waterfall Atlas Fund LP CIK 0001941965
Waterfall Asset Management management-team disclosures Co-Managing Partners Co-CIOs Asset-class leaders Risk, compliance and operating leadership