Backup Servicing – The Enabler for Your Financing Structure

To refinance asset-based business models (e.g., cars, vans, e-bikes, mobile devices, e-scooters, solar parks, etc.), companies often use bankruptcy-remote financing vehicles. These include securitization structures such as ABS, ABCP, or promissory note loans.

These financing mechanisms are relevant both for established companies with a sound credit history and for young companies (startups, scale-ups) in growth segments such as the sharing economy or “rent instead of buy” concepts.

Since these young players often cannot yet demonstrate a long-term data history to validate the default risk of their business model, the aforementioned structures offer efficient capital procurement at market conditions through collateralization using corporate assets.

To protect financing structures against the borrower’s default risk, financing partners (banks, investors) generally require the appointment of an independent backup servicer.

Operational Backup Servicing with Curadino

In the worst-case scenario of borrower insolvency, the backup
servicer ensures the continuity of the financing structure and the access of investors/banks to relevant information and assets.

The exemplary setup of an asset-based financing structure distinguishes between the asset operator (Originator or Opco), Special Purpose Vehicle (SPV or Finco), and Backup Servicer (BUS). The Finco acquires the assets to be financed from the Opco. As security for the financing partner, the shares in the Finco, the assets, and all associated cash flows and other rights are usually transferred by way of security. The Finco rents/leases the assets to end customers. The Finco does not perform the operational management and servicing of the portfolio itself but has outsourced it to the Opco. To mitigate the risk of an Opco default, the BUS is mandated, which, together with its network of service partners, ensures that the asset portfolio can continue to be operated or wound down even after an Opco default.

Bank and the asset operator’s financing vehicle (FinCo) conclude a financing agreement
Asset operator (OpCo) takes over the operational tasks and services of the FinCo
Curadino secures the OpCo default through its own services

Whether a portfolio is continued or wound down in the event of insolvency depends in particular on the remaining contract terms: short-term models are more suitable for a quick run-off, while for longer terms, continued operation may be more economically viable.

For companies seeking such a transaction, the strategic challenge lies in selecting a suitable and trustworthy partner for backup servicing. In this context, the neutrality of the backup servicer is of central importance to avoid the disclosure of sensitive corporate data and process information to potential market competitors.

Curadino’s operational backup servicing is based on many years of practical experience in the management, control, and liquidation of asset portfolios. Building on this expertise, a holistic service management structure was developed, positioned as an integrated one-stop-shop approach in the sense of a platform model. Curadino does not only focus on financial processes such as invoicing and payment processing but also takes over core operational services together with its partners – from customer support and repossession to maintenance and storage, through to remarketing and utilization. In this way, the portfolio is managed holistically.

Curadino acts as an independent service provider without its own market or competitive activities in the managed asset classes, thereby ensuring that the interests of the clients remain the sole focus. This neutrality forms the basis for a relationship of trust with market participants such as leasing and rental companies, providers of sharing and subscription models, and their financing partners.

Managing Diverse Asset Classes from a Single Source

E-Scooter

E-Bike

E-Moped

Car

Camper

Bus

Truck Fleet

Solar & Heating

Furniture

Mobile Device

Tiny House

Wind Farm

Tiny House

Mobile Device

Furniture

Solar & Heating

Truck Fleet

Bus

Camper

Car

E-Moped

E-Bike

E-Scooter

The ability to combine these different asset types within a uniform backup servicing structure underscores the versatility and adaptability of our operational service management.

Comprehensive Service Provision with an International Partner Network

Exercise of management and utilization rights (servicing) for the financed
assets to serve financing partners in the event of a crisis

Given the variety of necessary services that then arise, Curadino draws on a comprehensive network of qualified and specialized partner companies, built up over many years, to provide the contractually agreed operational services in the so-called Active Phase—i.e., in the event of insolvency or a comparable crisis scenario. This partner network covers a wide range of different services, including operational, technical, and administrative ones in particular. Each of the partners focuses on specific specialized services in the regions of Europe, North America, and the Middle East.

The basis for the rapid and efficient deployment of Curadino’s partner network is the data on the financed assets and, if necessary, the end customers, which Curadino stores during the Standby Phase from the Finco or Opco. Furthermore, the contractual and IT integration of the service partners already established during the Standby Phase is crucial.

In the event of activation, Curadino, together with its service partners, is thus able to initiate and implement coordinated measures at short notice to ensure continued operation, stabilize critical business processes, or—if necessary—implement the orderly, value-preserving liquidation of the affected assets. The goal is always to minimize loss of value, control risks, and safeguard the interests of the parties involved in the best possible way.

The operational services primarily comprise:

Remarketing

Buyback Management • B2B & B2C Resale • Refurbishing

Customer Services

Customer Service Hotline • Workshop Management

Logistics

Storage • Delivery

Payment

Invoicing • Payment Processing • Receivables Management

Asset Management

Operation & Maintenance • Refurbishment •
Accident & Damage Management • Maintenance & Wear •
Insurance & Tax • Reporting

Specialized Technology Platform as an Operational Enabler

Ensuring data integrity and availability regarding assets and the
underlying customer contracts

In a continuously changing environment, Curadino represents the stable constant for financiers and banks—across all phases of backup servicing. The foundation is an innovative technology platform through which Curadino acts as a data trustee and, if necessary, ensures the central, secure distribution of relevant data to the diverse partner network. Even during the passive phase, the data continuously provided by the Opcos is ongoingly validated and checked for quality and usability. In the event of an active phase, reliable and immediately usable information is thus available for all operational activities. For financiers, this approach creates a high degree of strategic and operational independence. Relevant processes can be initiated and operated based on the information already available and validated within the agreed SLAs—independent of the cooperation of, for example, an insolvency administrator or other third parties involved. The partners involved benefit from the data quality and the high degree of automation of the platform. Both enable efficient, high-quality service delivery following clearly defined processes. At the same time, the platform forms the basis for advanced reporting and analytics services that can be booked as needed. The secure and scalable operation and development of the platform take place in Germany, in certified and climate-neutral data centers operated according to the latest approval certifications. The respective processes and service compliance are regularly audited and evaluated by relevant industry institutions.

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