Venture Debt

Note that some of the products may not be available in Israel, for further information regarding the products please contact your Relationship Manager.

The debt is often obtained at the same time or shortly after an equity round (or multiple equity rounds) and can be used in a variety of ways – discussed and agreed in advance with the Lender. The facility can be structured with an interest-only period, however, as with other borrowing facilities, Venture debt needs to be repaid over a defined period of time.

Venture debt is a typically lower cost means of financing performance growth², investing in research and development, purchasing capital equipment and inventory, providing a ‘cushion’ for unforeseen funding needs and operational requirements, or customer acquisition costs through sales and marketing expenses. Note that we (or any Lender) may take a Warrant in the structuring of the debt. See below for a description of Warrants.

1. Secured financing: Venture debt can be secured against the company’s assets, providing us with a level of security while offering you access to essential financing to grow your business.
2. Aligned repayment terms: With flexible repayment structures (such as an initial interest-only period), venture debt allows you to manage your cash flows more effectively as your business grows and scales.
3. Equity upside potential: We may receive Equity Warrants, which effectively grants us, the Lender, the option (but not the obligation) to purchase equity in your business in the future, which allows us to share in your company’s success (without requiring immediate ownership dilution).
4. Cost-effective capital solution: Often complementing equity financing, venture debt can provide a less-dilutive form of financing alternative, allowing you to retain more ownership while still securing the necessary funds for running operations and growing your business.