“A single person falls in love through Parship once every 11 minutes.” Thanks to extensive marketing, this advertising slogan for the online dating site is now familiar to Germans nationwide.
But very few singles are aware of the owner of Parship, the financial investor Oakley Capital. Even less well known is the Permira lending fund, which financed the acquisition of Parship by the U.S. investor. But funds like these, known as debt funds, have been sharply on the rise in the last 12 months.
It’s the attack of the shadow banks. Debt funds, which are expanding rapidly, exploit the problems of traditional banks and are increasingly challenging them for their business with small- and mid-sized companies, collectively known as the Mittelstand.
Unlike banks, debt funds operate beyond the scope of public perception and with significantly fewer legal constraints. This has enabled these funds to achieve the kind of growth that is now rare in an industry largely in crisis mode, as evidenced by the almost daily reports about major German lenders like Commerzbank and Deutsche Bank.
The numbers are impressive. According to an analysis by the Alternative Credit Council (ACC) and consulting firm Deloitte, the market for financing outside the banking world had grown to a mind-boggling $560 billion (€502 billion) by the end of July, compared to $440 billion for all of 2015.