{"id":43754,"date":"2018-01-15T00:00:00","date_gmt":"2018-01-14T23:00:00","guid":{"rendered":"https:\/\/techma.bakertilly.es\/venture-debt-kantox-e-inveready-lanzan-nuevos-fondos-venture-debt\/"},"modified":"2024-09-13T12:08:06","modified_gmt":"2024-09-13T10:08:06","slug":"what-is-venture-debt-definition-a2","status":"publish","type":"diccionario","link":"https:\/\/techma.bakertilly.es\/en\/como-hacer\/que-es-un-venture-debt-definicon-a2\/","title":{"rendered":"What is Venture Debt? Definition, typology and examples"},"content":{"rendered":"<p><br>The growing investment culture has led to the emergence of numerous types of financing and a whole glossary of associated terms that are important to know. Today we explain what a <strong>Venture Debt<\/strong> and we present to you the examples of funds from <a href=\"https:\/\/www.svb.com\/\" target=\"_blank\" rel=\"nofollow noopener\">Silicon Valley Bank<\/a>, <a href=\"https:\/\/www.lightercapital.com\/\" target=\"_blank\" rel=\"noopener\">Lighter Capital<\/a> e <a href=\"https:\/\/www.innovencapital.com\/\" target=\"_blank\" rel=\"noopener\">InnoVen Capital<\/a>.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Contents\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #ffffff;color:#ffffff\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewbox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #ffffff;color:#ffffff\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewbox=\"0 0 24 24\" version=\"1.2\" baseprofile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/techma.bakertilly.es\/en\/como-hacer\/que-es-un-venture-debt-definicon-a2\/#%C2%BFQue_es_un_Venture_Debt\" >What is Venture Debt?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/techma.bakertilly.es\/en\/como-hacer\/que-es-un-venture-debt-definicon-a2\/#%C2%BFComo_funciona_un_Venture_Debt\" >How does Venture Debt work?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/techma.bakertilly.es\/en\/como-hacer\/que-es-un-venture-debt-definicon-a2\/#Usos_de_un_Venture_Debt\" >Uses of a Venture Debt<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/techma.bakertilly.es\/en\/como-hacer\/que-es-un-venture-debt-definicon-a2\/#Tipos_de_Venture_Debt\" >Types of Venture Debt<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/techma.bakertilly.es\/en\/como-hacer\/que-es-un-venture-debt-definicon-a2\/#Diferencias_con_otros_tipos_de_financiacion\" >Differences with other types of financing<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/techma.bakertilly.es\/en\/como-hacer\/que-es-un-venture-debt-definicon-a2\/#Casos_Reales\" >Real cases<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/techma.bakertilly.es\/en\/como-hacer\/que-es-un-venture-debt-definicon-a2\/#Lighter_Capital_y_Silicon_Valley_Bank_ayudan_a_impulsar_el_crecimiento_de_Sendlane\" >Lighter Capital and Silicon Valley Bank help boost Sendlane's growth<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/techma.bakertilly.es\/en\/como-hacer\/que-es-un-venture-debt-definicon-a2\/#InnoVen_Capital_invierte_en_UpScalio\" >InnoVen Capital invests in UpScalio<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"%C2%BFQue_es_un_Venture_Debt\"><\/span><strong><br>What is Venture Debt?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>A Venture Debt is a hybrid financial instrument combining debt and equity, most often aimed at companies invested by Venture Capital, to finance their working capital or capital expenditures, such as the purchase of equipment.<\/p>\n\n\n\n<p>Unlike traditional bank loans, this <strong>is available for startups and<a href=\"https:\/\/techma.bakertilly.es\/en\/value-growth-consulting\/\"> growing companies<\/a> that do not have positive cash flows<\/strong> or significant assets to use as collateral. Venture Debt providers combine their loans with warrants or stock purchase rights to offset the increased risk of default.<br><\/p>\n\n\n\n<figure class=\"wp-block-image aligncenter size-full is-resized\"><img decoding=\"async\" width=\"1000\" height=\"667\" src=\"https:\/\/techma.bakertilly.es\/wp-content\/uploads\/2018\/01\/startup-venture-debt.jpg\" alt=\"Use of Venture Debt in Startups\" class=\"wp-image-52381\" style=\"width:538px;height:359px\" title=\"\" srcset=\"https:\/\/techma.bakertilly.es\/wp-content\/uploads\/2018\/01\/startup-venture-debt.jpg 1000w, https:\/\/techma.bakertilly.es\/wp-content\/uploads\/2018\/01\/startup-venture-debt-300x200.jpg 300w, https:\/\/techma.bakertilly.es\/wp-content\/uploads\/2018\/01\/startup-venture-debt-768x512.jpg 768w, https:\/\/techma.bakertilly.es\/wp-content\/uploads\/2018\/01\/startup-venture-debt-600x400.jpg 600w\" sizes=\"(max-width: 1000px) 100vw, 1000px\" \/><\/figure>\n\n\n\n<p><br>This financial product can be a highly advisable source of capital for entrepreneurs. As a complement to equity financing,<strong>&nbsp;allows for raising more capital through a financing round while minimising dilution for employees and shareholders alike<\/strong>.<br><br><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"%C2%BFComo_funciona_un_Venture_Debt\"><\/span><strong>How does Venture Debt work?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ol class=\"wp-block-list\">\n<li>Initial Screening<\/li>\n\n\n\n<li>Roadmap<\/li>\n\n\n\n<li>Due Diligence and Investment Approval<\/li>\n\n\n\n<li>Legal and financing issues <\/li>\n\n\n\n<li>Portfolio management <\/li>\n\n\n\n<li>Investment Exit<\/li>\n<\/ol>\n\n\n\n<p><\/p>\n\n\n\n<p>Venture Debt investors, which are usually commercial banks or specialised financial firms, often require a <a href=\"https:\/\/www.bakertilly.nl\/en\/services\/corporate-finance\/due-diligence\/\" target=\"_blank\" rel=\"noopener\">Due Diligence<\/a> and the backing of another investor as collateral for the granting of this type of financing.<\/p>\n\n\n\n<p>It is also a common investment model in technology-based investment markets, such as the US, the UK and Israel, and has been used in the early stages by companies such as Facebook and Box.<br><br><br><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Usos_de_un_Venture_Debt\"><\/span><strong>Uses of a Venture Debt<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Increase valuation<\/li>\n\n\n\n<li>Increasing liquidity<\/li>\n\n\n\n<li>Increasing investment capacity<\/li>\n\n\n\n<li>Finance an acquisition or investment<\/li>\n\n\n\n<li>Bridge financing to accelerate growth prior to an investment round or prior to a sale<\/li>\n\n\n\n<li>Financing working capital needs<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Tipos_de_Venture_Debt\"><\/span><strong><br>Types of Venture Debt<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>There are three different types of Venture Debt:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Capital expansion<\/strong> or <strong>capital development<\/strong>term loans: these are typically term loans used in M&amp;A transactions, staged financing or working capital.<\/li>\n\n\n\n<li><strong>Accounts receivable financing: <\/strong>loans to finance accounts receivable on the Balance Sheet.<\/li>\n\n\n\n<li><strong>Equipment financing: <\/strong>loans for the purchase of equipment, such as a company's digital infrastructure.<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Diferencias_con_otros_tipos_de_financiacion\"><\/span><br><strong>Differences with other types of financing<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The Venture Debt, in addition to being a non-convertible fixed-term loan, has an interest cost of between 10% and 15% and does not generally carry board participation rights. <\/p>\n\n\n\n<p>However, the <strong>Venture Capital<\/strong>As its name suggests, it does not contribute debt to the invested company, but equity. Therefore, the amount invested does not have to be paid back to the Venture Capital, but they get the return by selling their stake in the company. Both types of financing are <strong>complementary<\/strong>.<\/p>\n\n\n\n<p>Other types of financing with which DV should not be confused are:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>La <strong>Convertible Debt<\/strong>loan (usually provided by an equity investor) that is converted into equity in the company's next equity round. <\/li>\n\n\n\n<li>La<strong> Working Capital Line<\/strong>revolving credit line: a revolving credit line that is secured by working capital. It may or may not include guarantees for the purchase of shares in the company. <\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Casos_Reales\"><\/span><br><br><strong>Real cases<\/strong><br><br><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Lighter_Capital_y_Silicon_Valley_Bank_ayudan_a_impulsar_el_crecimiento_de_Sendlane\"><\/span><strong>Lighter Capital and Silicon Valley Bank help boost Sendlane's growth<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p><a href=\"https:\/\/www.sendlane.com\/\" target=\"_blank\" rel=\"nofollow noopener\">Sendlane<\/a> is an innovative software company that enables e-commerce brands and content creators to collect, segment and automate the customer journey through email marketing and SMS. Based in San Diego, California, the organisation was co-founded by CEO Jimmy Kim, CPO Zak Metfah and consultant Anik Singal.<\/p>\n\n\n\n<figure class=\"wp-block-image aligncenter is-resized\"><img decoding=\"async\" src=\"https:\/\/s3.us-east-2.amazonaws.com\/wordpress-media.lightercapital.com\/wp-content\/uploads\/2020\/02\/13165951\/SVBLC_CobrandedLogo-RGB.png\" alt=\"Venture Debt, Lighter Capital, and SVB collaborate to drive Sendlane&#039;s growth\" style=\"width:454px;height:136px\" title=\"\"><\/figure>\n\n\n\n<p>Lighter Capital, a US Venture Debt fund, has made 320 investments, including two in the software company. On 29 July 2020, the fund invested half a million dollars in Sendlane, while the second round of financing saw an injection of 450,000. On both occasions Lighter Capital was supported by Silicon Valley Bank.&nbsp;<\/p>\n\n\n\n<p>With funding from Lighter Capital, Sendlane experienced faster growth with revenues of $$130k per month now reaching $210k per month.<br><br><br><br><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"InnoVen_Capital_invierte_en_UpScalio\"><\/span><strong>InnoVen Capital invests in UpScalio<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>UpScalio is India's next-generation, data-driven consumer goods company. They acquire e-commerce companies that sell on Amazon, Flipkart and other marketplaces, as well as their own websites. They are backed by hedge funds and private equity firms around the world.<\/p>\n\n\n\n<figure class=\"wp-block-image aligncenter is-resized\"><img decoding=\"async\" src=\"https:\/\/www.innovencapital.com\/wp-content\/uploads\/2018\/10\/innovenlogo2018-min.png\" alt=\"Homepage - InnoVen Capital\" style=\"width:361px;height:95px\" title=\"\"><\/figure>\n\n\n\n<p>UpScalio guarantees profits to the original founders, providing a full exit over time. This company provides the capital and its team takes full responsibility for growing the business by 5 to 10 times, maximising wealth creation for the founders.<\/p>\n\n\n\n<p>Innoven Capital has made 183 investments since its inception as Venture Debt. Its latest investment was made on 17 August 2021 in UpScalio for a total amount of $42.5 million.&nbsp;<\/p>","protected":false},"author":4,"featured_media":0,"template":"","meta":{"_acf_changed":false,"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":""},"tags":[1952,1951],"paso-howto":[2275],"sectores":[],"class_list":["post-43754","diccionario","type-diccionario","status-publish","hentry","tag-lighter-capital","tag-svb","paso-howto-financiacion-alternativa-contenido"],"acf":[],"_links":{"self":[{"href":"https:\/\/techma.bakertilly.es\/en\/wp-json\/wp\/v2\/diccionario\/43754","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/techma.bakertilly.es\/en\/wp-json\/wp\/v2\/diccionario"}],"about":[{"href":"https:\/\/techma.bakertilly.es\/en\/wp-json\/wp\/v2\/types\/diccionario"}],"author":[{"embeddable":true,"href":"https:\/\/techma.bakertilly.es\/en\/wp-json\/wp\/v2\/users\/4"}],"wp:attachment":[{"href":"https:\/\/techma.bakertilly.es\/en\/wp-json\/wp\/v2\/media?parent=43754"}],"wp:term":[{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/techma.bakertilly.es\/en\/wp-json\/wp\/v2\/tags?post=43754"},{"taxonomy":"paso-howto","embeddable":true,"href":"https:\/\/techma.bakertilly.es\/en\/wp-json\/wp\/v2\/paso-howto?post=43754"},{"taxonomy":"sectores","embeddable":true,"href":"https:\/\/techma.bakertilly.es\/en\/wp-json\/wp\/v2\/sectores?post=43754"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}