Mike Smith: Reflections on the industry

opinion

by Aircraft Investor Expert

16 July 2026

"This industry is unique, and it’s uniquely ours," says Smith.

The following article has been contributed by Mike Smith, president of Scope Aircraft Finance.

I first entered the aircraft finance industry in October 2011, which means this fall will mark 15 years in the industry. While that’s not a huge milestone, I do think it creates opportunity for pause and reflection. I’ve learned a lot about the aircraft finance space in those 15 years and wanted to share some of those lessons and observations as we enter the second half of 2026.

For those that were in the industry in 2011, it was still a dark time. We were in early recovery from the economic crisis of 2008. Recovery is a loose term, the industry scars of 2008 were still open wounds that hadn’t healed yet. Demand was light and a lot of banks tightened their lending standards. Surprisingly, interest rates were 2% or more below where they are now, yet demand wasn’t strong. What a unique time to enter the industry.

“We are privileged to work in an industry that we are all passionate about,” says Smith.

The blessing for me was that I was able to learn the lessons of 2008 without experiencing the trauma directly (at least from that side of the industry, I did try to finish college and enter the workforce in that era, so I have my own scars and stories from those crazy times). I was also lucky enough to have great mentors at Scope to teach me strong foundations. Folks who had not only survived 2008 but thrived in it, and in economic cycles before too.

One of my mentors taught me early on the importance of “proper, prudent loan structure” with every loan opportunity. Put simply, that meant making sure the loan pays down faster than the asset loses value. We underwrite to financial strength but in the case of a workout loan, there’s a good chance the financial strength goes away, so we have the asset left to make sure we’re made whole.

He used to tell me to be cautious about calling yourself an expert. We are in an industry of highly experienced people owning, operating, or transacting sophisticated machines, they’re the experts, we should learn from them. That’s a mindset I still try and operate from today. As a lender in this industry I’m here to humbly serve the experts.

Another observation has to do with the shared passion of the industry. I was taken aback at the excitement and energy I felt in the room when I attended my first conference. Over the years I’ve come to realise that we are privileged to work in an industry that we are all passionate about. Only in our industry will you see someone in the middle of a serious business conversation stop and look to the sky to see what’s flying overhead when they hear an airplane, then go right back to their conversation like they didn’t miss a beat.

I’ve often wondered if commercial developers at conferences get as excited about rubber membrane roof displays as I get about seeing a PT-6 model on the NBAA floor, even though I’ve seen it 500 times already. This industry is unique, and it’s uniquely ours.

That unique shared passion drives home the value of relationships in our industry, the shared pride to be involved in something as big as aviation. My mentor used to also remind me of the importance of remembering how our borrowers look at their aircraft…and this is especially true in the owner-flown markets that we historically served. To our borrowers the purchase of their aircraft is the fulfilment of a goal, both an aviation goal and a life goal, and they treat their aircraft as such.

The reality is, we on the lending side sit form a unique perch, observing the industry from multiple angles, since we have so much capital invested in each asset. While we aren’t (hopefully) aircraft owners, we have to look through an owner’s lens to best inform how we approach lending, and have strong portfolio management.

It’s this long term view and macro perspective that drew me to aircraft finance, and keeps me invigorated to serve the industry for decades to come.