In this episode of The Credit Bubble, I sit down with Krista Morgan, co-founder of Edited Capital, a lower-middle-market private equity firm that acquires controlling interests in venture-backed software companies. Krista’s career arc is unusually wide - an economics degree at McGill in Montreal Canada, early digital marketing in London, founding an invoice-financing fintech platform in Colorado that cycled roughly a billion dollars of receivables before selling in a tough 2019 market, and now co-founding Edited Capital.
We dig into Krista’s argument that venture, at its core, has a contract problem more than a funding problem - that the asset class works as a power-law game, but the absence of any clean “we tried, here’s how we part ways” infrastructure is what leaves so many otherwise-good businesses stranded. We get into why she thinks today’s setup - post-COVID overfunding, AI disruption, and an unusually concentrated venture market — adds up to a generational buying opportunity for sponsors willing to clean up cap tables.
We also cover where senior lenders fit in (roughly half of Edited’s deal flow comes through private credit funds, often as a forcing function in workouts), why M&A is the most underused growth lever in early-stage tech, how Krista thinks about hosting costs, headcount, and the question of what the business actually needs to do today, and how AI-native companies that didn’t make their Series A are already starting to show up in her pipeline.
