Article · ~12 min read

Thinking Through Venture Debt: What It Is and How It Works

AirTree Ventures · airtree.vc Free Intermediate

An Australian VC's open guide to the kinds of venture debt (revenue-based financing, term loans, lines of credit), what each costs and when covenants and warrants come with it.

  • Revenue-based financing has no covenants but costs more and is repaid faster.
  • Term loans bring covenants and warrants in exchange for larger amounts and longer terms.
  • Model the covenants before you sign, not after.
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The question it answers

  1. What's venture debt, and when should I take it instead of - or alongside - equity?

Read with it

  1. An India-first CFO's guide to how venture debt actually works here - who lends it, what it costs, and why it follows equity... cfomatrix.in Article Venture Debt & Debt Funding India: Complete Guide CFO Matrix
  2. Alteria Capital describes itself as India's leading venture debt fund, lending to startups backed by established VC investors.... alteriacapital.com Tool · Website Alteria Capital Alteria Capital
  3. InnoVen Capital has lent venture debt to early and growth-stage technology businesses in India since 2008 and runs a venture... innovencapital.com Tool · Website InnoVen Capital InnoVen Capital
  4. The official page for CGSS, which guarantees loans, venture debt and working capital given to DPIIT-recognised startups by... startupindia.gov.in Article · Scheme page Credit Guarantee Scheme for Startups (CGSS) Startup India
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