Startup Financing

Senior debt is borrowed capital that takes repayment priority over other debts. It offers lower interest rates but requires collateral and strict repayment structures that impact future financing.

Venture debt is a loan for VC-backed startups used to extend runway and minimize dilution. It serves as complementary financing to equity but comes with repayment obligations.

An explanation of the due on sale clause, detailing why lenders require full repayment upon asset transfer and how this impacts startup exits and pivots.

A bridge loan fills the gap between financing rounds. This article defines the term, outlines when to use it, and explains the risks of bridging to nowhere.

A straightforward explanation of loan covenants, detailing how affirmative and negative promises impact startup flexibility and lender relationships during debt financing negotiations.

A bridge round provides interim capital to reach the next funding milestone. It buys time but carries dilution risks and signals specific messages to future investors.

An overview of mezzanine debt financing, explaining its hybrid nature, how it differs from senior loans, and when growing companies should consider it.

Subordinated debt is a loan ranking below senior debt in repayment priority. It offers capital without immediate equity dilution but carries higher interest rates and risk.