The investment firm has launched a new finance and innovation company focused on commercial pallet leasing
Philadelphia-based 912 Capital Partners is launching a new finance and innovation company called Adaptive Pallet Solutions.
The company leases plastic, trackable pallets to companies to support logistics operations. Companies can lease the pallets, which are stronger than traditional wood pallets, recyclable, and also provide realtime tracking information via embedded sensors, and pay for them over the life of the lease.
912 Capital Partners will create custom lease agreements and in the future plans to offer asset backed securitisations.
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Rodrigo Castro (pictured right), managing partner at 912 Capital Partners explains that the company plans to create an end-to-end offering. Adaptive Pallet Solutions has a relationship with a partner manufacturer that offers the pallets to APS at a discount, embedded GPS tracking lowers the pallet loss rate and can reduce the risk of theft or inventory mixup, according to Castro.
Broken or damaged pallets can be recovered by APS and new pallets can be created from recycled old pallets keeping replacement costs low. As a result, the pallets are a trackable asset that private credit can lend against.
Castro adds that lending can be done against the leases as well. “We see it as a capital arbitrage opportunity,” he told Alternative Credit Investor. “Our contracts are multi-year, contractually guaranteed cash flows from companies with excellent credit quality.”
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The leasing programme allows companies to put the cost of pallets down as an operating expense rather than a capital expense. Companies can also delegate pallet management and tracking instead of managing that in-house.
The investment in and creation of Adaptive Pallet Solutions is the latest in a growing portfolio for 912 Capital Partners which launched in 2024. Other companies in the portfolio include Anua International, a provider of wastewater treatment solutions and Hydra-Tech Pumps, a designer and manufacturer of hydraulic submersible pumps.
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912 invests around themes including American manufacturing, digital infrastructure, power generation, water management, and manufacturing-adjacent sectors. Castro says the plan is to be a very long term investor in its companies – a model which has gained early interest from family offices. “In many cases family offices grew out of founder-owned businesses, so they understand what we’re doing and our approach,” he said.
“We’ve got time on our side and we want to do our investments the right way.” Castro said.
