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There are definitely investors that like venture debt risk/reward like the following firms: http://www.goldhillcapital.com/ http://www.goldhillcapital.com/ htt
by awaxman11 13y ago
There are definitely investors that like venture debt risk/reward like the following firms:
http://www.goldhillcapital.com/ http://www.goldhillcapital.com/
http://www.westerntech.com/ http://www.westerntech.com/
http://www.orix.com/ http://www.orix.com/
There are also some commercial banks with venture debt arms like SVB, Comerica, and Square 1
- charlesbonello 13y agoBoth answers are correct, and make sense. I guess my question is fundamentally: is this a problem of supply (i.e. - not a lot of appetite to fund debt at these levels) or one of demand (entrepreneurs just prefer equity).
- danvoell 13y agosupply. Banks theoretically would provide debt to a company with 1mm in revenue, as long as they show the ability to cover the debt payments. But those companies typically can raise more money based on equity than debt.
- charlesbonello 13y agoSo the concern is that a debt financing would be smaller than a potential equity financing by some order of magnitude, as it's constrained by trailing cash flow rather than future opportunities?