JPMorgan has launched a $5 billion asset-backed offering backed by recurring software subscription revenues to gauge institutional appetite for a new tech-focused debt instrument. The securities mark the first large-scale securitization of purely software revenue streams.

The deal comprises floating-rate notes due 2029 with investment-grade ratings from Fitch and Moody’s and a blended coupon tied to three-month SOFR plus a spread. JPMorgan will act as lead underwriter alongside Bank of America and Citigroup, offering senior and mezzanine tranches.

Investors have shown growing interest in tech debt due to a hunt for higher yields, but securitizing software contracts represents an innovative asset class. Sponsors estimate up to $100 billion in attractive recurring revenues could be tapped for future securitizations if demand holds.

For JPMorgan, the deal could generate tens of millions in underwriting and structuring fees while establishing a first-mover advantage in software-backed securitizations. Success may prompt rivals to launch similar offerings, expanding fee pools in corporate finance.