In the world of finance, money is more than a mere measurement of wealth – it’s almost as revered as a religion. Based on the attendance at this year’s ACG (Association of Capital Growth) National Conference, this annual gathering of the financial faithful may soon be known as the “mecca of finance.” What began three years ago with fewer than 500 attendees has exploded into an enormous event attracting nearly 2,000 finance professionals, no small feat since each attendee paid a substantial registration fee.

As private equity transactions increase, the need for junior capital (second lien loans and mezzanine debt) has risen exponentially. According to Standard & Poor’s, the average middle market deal for the second quarter of 2006 ($50 MM in EBTIDA or less) was funded using 40% equity, 40% senior debt and 20% junior capital. The recent historically low interest rates made second lien financing attractive in larger deals with greater collateral. Therefore, the need for traditional mezzanine financing was reduced and was primarily used to bridge the gap between the second lien and the equity.