How LPs Can Earn 16–20% Returns Without Equity Risk
Would you take a 16–20% return without taking equity risk?
Most investors see numbers like that and assume it’s “too good to be true.” But in private credit, especially in underbanked niches like cannabis lending, outsized returns often come with less leverage, tighter covenants, and stronger downside protection.
Recently on The Passive Income Playbook, featured on the Best Ever CRE network, Pascal Wagner sat down with Peter Sack, Managing Partner at Chicago Atlantic, to break down how his firm has deployed $2B+ in private credit.
You’ll learn how they target 16–20% returns through first-lien lending, why cannabis lending offers unique regulatory moats, and how LPs should evaluate the differences between private funds, REITs, and BDCs.
In this episode:
✅ Why underserved markets create better lender terms (lower leverage, higher yields)
✅ Cannabis credit explained: state licensing, oligopolies, and downside protection
✅ How Chicago Atlantic achieves 16–20% targets with senior-secured positions
✅ The trade-offs between private funds vs. public REITs (REFI) vs. BDCs (LIEN)
✅ How to underwrite debt funds: lien position, leverage, audits, and non-accruals
✅ What federal policy shifts could mean for LPs in this space
Peter also breaks down:
• Why covenants, guarantees, and documentation matter more than headline yield
• How diversification vs. specialization changes risk-adjusted returns
• Why 20–30% of their portfolio sits outside cannabis—but under the same credit lens
Whether you’re looking for higher-yield income plays or simply want to sharpen your private credit due diligence, this episode shows how smart LPs can capture equity-like returns while staying senior in the stack.
👉 Get 25+ Passive Investment Deals in Your Inbox:
http://growyourcashflow.io/investing-starter-kit-yt
Chapters:
00:00 – Why Private Credit Could Be the Safest 16–20% Return You’ll See
02:22 – How Underserved Niches Give LPs Better Yields and Safer Terms
03:28 – Cannabis Credit 101: Why State Licenses Create Built-In Moats for Lenders
10:55 – First-Lien Advantage: How Senior Positioning Protects Your Capital
12:59 – Why Banks Withdrew—and How That Opened the Door for Private Credit LPs
14:36 – How Chicago Atlantic Structures 16–20% Returns With Lower Leverage
24:29 – Public vs. Private: Choosing Between REFI, LIEN, or Private Funds
31:22 – BDCs Explained: The Most Overlooked Yield Vehicle for LP Investors
34:09 – Beyond Cannabis: When Diversification Improves Risk-Adjusted Returns
50:18 – LP Due Diligence Playbook: 5 Questions to Ask Before Wiring Money
Most investors see numbers like that and assume it’s “too good to be true.” But in private credit, especially in underbanked niches like cannabis lending, outsized returns often come with less leverage, tighter covenants, and stronger downside protection.
Recently on The Passive Income Playbook, featured on the Best Ever CRE network, Pascal Wagner sat down with Peter Sack, Managing Partner at Chicago Atlantic, to break down how his firm has deployed $2B+ in private credit.
You’ll learn how they target 16–20% returns through first-lien lending, why cannabis lending offers unique regulatory moats, and how LPs should evaluate the differences between private funds, REITs, and BDCs.
In this episode:
✅ Why underserved markets create better lender terms (lower leverage, higher yields)
✅ Cannabis credit explained: state licensing, oligopolies, and downside protection
✅ How Chicago Atlantic achieves 16–20% targets with senior-secured positions
✅ The trade-offs between private funds vs. public REITs (REFI) vs. BDCs (LIEN)
✅ How to underwrite debt funds: lien position, leverage, audits, and non-accruals
✅ What federal policy shifts could mean for LPs in this space
Peter also breaks down:
• Why covenants, guarantees, and documentation matter more than headline yield
• How diversification vs. specialization changes risk-adjusted returns
• Why 20–30% of their portfolio sits outside cannabis—but under the same credit lens
Whether you’re looking for higher-yield income plays or simply want to sharpen your private credit due diligence, this episode shows how smart LPs can capture equity-like returns while staying senior in the stack.
👉 Get 25+ Passive Investment Deals in Your Inbox:
http://growyourcashflow.io/investing-starter-kit-yt
Chapters:
00:00 – Why Private Credit Could Be the Safest 16–20% Return You’ll See
02:22 – How Underserved Niches Give LPs Better Yields and Safer Terms
03:28 – Cannabis Credit 101: Why State Licenses Create Built-In Moats for Lenders
10:55 – First-Lien Advantage: How Senior Positioning Protects Your Capital
12:59 – Why Banks Withdrew—and How That Opened the Door for Private Credit LPs
14:36 – How Chicago Atlantic Structures 16–20% Returns With Lower Leverage
24:29 – Public vs. Private: Choosing Between REFI, LIEN, or Private Funds
31:22 – BDCs Explained: The Most Overlooked Yield Vehicle for LP Investors
34:09 – Beyond Cannabis: When Diversification Improves Risk-Adjusted Returns
50:18 – LP Due Diligence Playbook: 5 Questions to Ask Before Wiring Money
Creators and Guests
Host
Pascal Wagner
I help accredited entrepreneurs & executives in the US replace their primary income through private investments.
