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- [00:00]
A
This is Scott Becker with the Becker Business and the Becker Private Equity Podcast. We're joined today by a brilliant financial guru, by an entrepreneur. We're joined by Bruno Ratio. Bruno's the, the, the CEO of East Harbor Financial. He's going to talk to us about trends. He's watching and investing about East Harbor Financial and a lot more. Bruno, can you take a moment to introduce yourself?
- [00:24]
B
Yeah, absolutely. So since second generation owner mostly focused on investing in, in leases and private credit, I, you know, a lot of people ask me, you know, what do I see as a financial, by the way, I'm not a financial guru whatsoever, but I, I do consider myself an expert in the field that I'm in, which is mostly private credit and leasing.
- [00:47]
A
Thank you. And tell us a little bit about what's going on in, in the private credit world today. The leasing world today. What are some of the biggest forces that you're watching in sort of that world of private credit and also leasing?
- [01:02]
B
Absolutely. So there is a niche that we do because private credit is so extensive, it could, it could be mean almost anything, you know, just a private loan. And a lot of the big companies that make all the splash, you know that that's what most people know. They're mostly lending to very large private company or public companies using this private capital. Our niche really is an asset based le lender. We focus on financing commercial trucks, construction equipment, yachts, aircrafts, real estate for clients that are not bankable for one reason or another. So that's really our expertise, using our private credit to fund these transactions.
- [01:42]
A
Fantastic. And where do you see the most interesting opportunities in that world today? Where are you most excited in that world today?
- [01:51]
B
So we do different industries. Usually I don't say it's in one particular industry, it just comes and goes. You know, I get an aircraft deal in the morning and then in the evening I'm looking at a construction equipment deal. Lately it's been a lot of yachts and real estate. The transportation sector is a little slow. The construction is still chugging along, it's doing fine. But I wouldn't say that there's one particular sector that is doing better than the others, at least not to where I'm not doing anything else besides that sector.
- [02:25]
A
And when you look at sort of the biggest forces shaping markets currently, high interest rates, challenging credits from big banks, artificial intelligence, geopolitical issues, what are the big issues that are shaping the opportunities today or shaping the markets today?
- [02:43]
B
Well, look, you have to look at what particular market we're talking about all These things that you mentioned are, they affect a certain industry a lot. For example, interest rates affect real estate quite a bit. But AI, for example, is not affecting real estate very much. You know, geopolitical is. It affects, especially in the Middle East. You have tensions in the Middle east where it affects oil prices. But, you know, the Middle Eastern, you know, political issues are not affecting real estate here in anywhere in the country really. So it really, you have to really bring it down to one specific sector. And even then it's fragmented, you know, so. So it really depends on what we're talking about.
- [03:24]
A
Thank you. And where do you tend to see the most compelling opportunities today? And you largely work in the private credit and the leasing niche. So you're not looking as much at sort of large cap stocks. The Magnificent Seven international markets. You're really more focused on this particular business, the private credit and leasing. Is that, is that a fair statement?
- [03:44]
B
Correct. Yeah. Most of our clients are not Fortune 500 companies. In fact, I don't think we have any. Our stuff is you the backbone of America? It's a small businesses, individuals, I'd say probably under $100 million net worth and below that are running their own small business, you know, underneath under 500 employees. Some have, you know, five employees, some have two employees, some have 100, you know, but we don't really look at definitely not the Magnificent Seven. They're not requiring any private credit from anyone. And if they are, I would say only maybe a handful of companies in the world can probably service them. So. So that's really not our focus for
- [04:24]
A
investors that invest with you as markets become volatile or uncertain, how do you think about your, your customers, your clients who invest with you? How do you think about sort of capital preservation versus staying invested versus cash flow returns? How do they think about things, you know, during riskier times?
- [04:47]
B
So the types of clients that we have are really long term capital. They're individuals that, you know, want to have a certain safety net. We are investing. We're either lending or buying assets to lease that are hard assets. So we're buying real estate, we're buying brand new trucks, brand new construction equipment and yachts. So there's no scenario where our, our assets just go to zero like you would a stock like you would on some kind of venture capital space. So, you know, most of our clients have a very low risk tolerance and that's why they like going with us because we are all asset backed. We've been doing this for 30 years. And it's, you know, you kind of make your money the day that you close a deal, just like any bank would. They're very well collateralized and when they sign an agreement, they know exactly what they're going to make because it's the interest rate and the origination on most other transactions. You know, for example, like stocks, cryptocurrency, even real estate, you really never know what you're going to earn because it's very speculative. You know, it could, it could go up very fast like oil and gas has done. It could, you know, stock could like the magnificent Seven have gone up, you know, great amounts. But in many cases, you know, we've seen, you know, commercial reads which are traditionally have been very safe and today are in the gutter, you know, so it's really, you're really never sure what you're going to earn and that's why there's a risk, there's a higher risk in my opinion, for those kinds of investments.
- [06:14]
A
Thank you. And are there areas where you see lower risk in terms of what you're doing versus higher risk? And, and what's the typical investor that invest with you? Who's investing with you?
- [06:27]
B
So a lot of, as mentioned, same as our customers, small businesses, individuals, high net worth individuals that are attorneys, they're doctors, they're surgeons. You know, they're basically individuals that sell their time. That's really the best client that we have is the customer, the individuals that sell their time. So they're super busy, they make a lot of money and they don't know where to put it. Right. And, and we're one of those options where they can be diversified and as mentioned, have a, a good safety net for their capital here to compound year over year, collateralized by hard assets.
- [07:04]
A
Thank you. And when you look at this year going forward, what are you most excited about and focused on for the rest of 2026? Where are you most focused and excited?
- [07:16]
B
So I'm, I'm being pretty cautious. 2026, you know, for, for long time economists have been wondering when this next recession is coming. And while I am optimistic about the future, I'm making sure that I'm cautious. As I mentioned, there isn't one specific sector that I really like. I'm just taking deals as they go, making sure that the assets that we buy or that we lend on have very low depreciation. You could easily tell what they'll be worth in a couple of years. So for example, real estate, it's not going down too much in price. You know, your 20 is probably your, your pretty Bad case scenario. If we're doing other assets, we make sure that they're, that they're, they're not assets that could be affected by anything that's going on. For example, oil and gas, if it plummets, you know, we try to stay away from those kind of things because the prices of oil fluctuate quite a bit. But I, I'd say we just take it on a deal by deal basis.
- [08:12]
A
For entrepreneurs and professionals, a lot of who you work with who are trying to build wealth for the long run, but aren't managing their own money or are so busy that it's hard to do. So what are a couple of the common investing mistakes that you see entrepreneurs or high net worth professionals make?
- [08:30]
B
Great question. One of the things that I see is the individuals that have a very high risk tolerance and they kind of want to find opportunities that can really compound their money very fast, almost irregularly fast. You know, like they're just going incredibly optimistic and, and I think they take too much risk. They go into these venture capital kind of transactions and, and thinking they're gonna, you know, 5x their money or two extra money over a couple years and then they end up losing it. You know, unfortunately, we've had a lot of scenarios where, where individuals are kind of regretful of that. On the other end of the spectrum that you have the guys that are, you know, terrified to invest in their money because they're not sure of what they're doing and they've probably been bur they're keeping their money in banks, you know, on, on safety deposit slips or, or something that's offering a very low yield with almost zero risk. And you know, I tell people, you know, don't use the extremes, kind of go somewhere in the middle. You know, you could buy real estate, you could be invested in some funds that, that are, have some downside protection like in our case. We do because we know we're, we're on asset heavy deals, you know. But don't go to the extremes. They're very risky, you know.
- [09:44]
A
Thank you. So that, and when somebody comes to invest with you, how much do they think about investing with you? How do you look at that? Is there a minimum, is there a maximum? How do you look at people joining you and investing with you and your funds?
- [09:57]
B
Right. So historically we've always just borrowed capital from banks that's been the, I guess, the client that is easiest to work with because that's their business lending money. But we do have some programs, you know, for some of our Friends and family and other investors that would like to come alongside us. Traditional size would generally be. We started with the 250 minimum. Lately we've been considering the 500,000 and above. But I would say that the most important thing is not really the dollar amount. It's really individuals that want to park capital here long term. Because as mentioned, this is a business where you're lending and loans are long term. You know, historically, you know, they're not, you know, six months or a year or two. Some of the transactions that we do for new assets are five, six years out. You know, even though the real estate you can lend, you know, 30. We don't do 30 year transactions. But, but if we were to do it, it's a very long term game. In the bridge loan, the space that we're in, it's usually between one and three years. But we want to make sure that this capital is compounding and it's not coming in and then two years later coming right back out. Because it just provides a lot of paperwork that's not necessary, 100% and a
- [11:06]
A
lot of transaction costs and a lot of headaches. And you want a stable set of investors that you're with for the long run, that you could deliver for. For the long run. Talk about the name East Harbor Financial. I love the name. I know it's a family business originally. How did you guys come up with the name East Harbor Financial?
- [11:23]
B
That's funny. That's an actual. A friend I have to give the credit to a friend of mine. His name's Jose Gonzalez. He told me, he's like, you know, we're here on the coast, but you want to have that old money kind of feel, you know, so he's like, how about Eastern Harbor? And then finally I said, you know what, I like it, but let's shorten it. Let's make it East Harbor. And that's how it came about. Honestly, just a quick conversation with him and, and we both liked it and
- [11:48]
A
we kept it well, we absolutely love it. What else should we know about what you're doing today? Tell us more, Bruno. What else should we know? What else should an investor know? What else should the market know? You know, where you're looking for opportunities?
- [12:01]
B
Well, most of our deals, in fact, 90, 99% of our deals come from financial brokers. These are individual work on their own. They're, they're constantly in contact with businesses and individuals that need loans. And so they're trying to get them, you know, bank loans when they can't get the bank loans, then they have to go, you know, their finance companies and we're on that tier of the finance companies, you know, so that, that's how our transactions come in. And you know, we have our financials that are audited today and we've been doing this for a long time, you know, so I think right now it's on cruise control. It's really a great business. You could sleep very well at night and you know, it's just not a get rich quick scenario and, and you're not going to be hitting home runs. You know, this is not like the stock market where you can have some really great years, you know, and then some years you're obviously pulling your hair out because the market's in recessions and it's going down, you know, so I'd say if you're looking for stability, this is a great industry to be in.
- [12:58]
A
Love it in, Bruno. Where can people learn more about Bruno Ratio and East Harbor Financial?
- [13:04]
B
Well, you can catch us on social media. I run a podcast called the bank the Backbone of America where I interview, you know, entrepreneurs that are, that have really done some remarkable things in the community. You could always catch us here. We're here located in Miami, our offices, we've been here for, for a very long time and you know our website so it's not hard to find us.
- [13:26]
A
Bruno, it's fantastic to visit with you. Congratulations on what you're doing. We love the markets you're in. Again today we're visiting with Bruno Ratio, the CEO of East Harbo Harbor Financial. Bruno, just fantastic to visit with you on the Becker business in the Becker private equity podcast. Just terrific what you're doing.
- [13:42]
B
Thank you, thank you for having me.
- [13:47]
C
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