Fix light in the Asset Management Agreement

Aug 6th, 2022
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An asset-light strategy or business model involves transferring capabilities, such as people, process and technology, to better owners in order to enable companies to transition fixed costs to a variable cost structure, enhance agility, and facilitate a shift of resources that allows a focus on core capabilities.
Asset-light strategies involve outsourcing core functions and processes to third-party providers, such as insurtech startups and other specialized companies. This allows insurers to focus on their core competencies like product development, underwriting and risk management.
Asset-lite carriers work as independent players while maintaining smaller networks. Theres yet another carrier model to consider. Asset-lite, or asset-light depending on word preference, describes a freight carrier model that falls somewhere between a non-asset-based and asset-based brokerage or carrier.
The best-known examples include well-known companies such as Airbnb and Uber or providers of co-working spaces such as WeWork. Another well-known example of the asset-light approach is Apple, which outsources numerous areas that require high investments (production facilities, personnel) to third parties.
Uber, Airbnb, Meta Platforms, and Alphabet, are the names of popular companies that have gained leadership within their respective industries, but all possess one common trait, they are asset-light businesses.
Highly Scalable: The primary advantage of an asset-light business model is its scalability. Given the fact that the investment made on the startup and operations is less in comparison to the profit harvested.
Asset-light debt is a form of corporate debt where the amount of collateral is below typical standards. A company may not have the assets to post as collateral for a loan and may seek out cash flow financing, using their cash flow to qualify for a loan.

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