Venture Debt: An Alternative Source of Bridge Capital During These Uncertain Times

In recent weeks, markets have tightened, and capital has become harder to secure. The S&P 500 recently dipped into bear market territory and central banks globally are raising rates aggressively to control the highest levels of inflation since the 1980s.  The reversal is a shift from a decade of low interest rates that saw investors pour $1.3 trillion into startups, which sent company valuations to the stratosphere and produced a record number of unicorns annually.  

Since then, money managers have fled startups and venture capitalists are steering clear of high valuations. Venture capital investment fell 26% in the first three months of 2022 as compared to Q4, according to Pitchbook data. Startups that seemed to be soaring months ago are struggling to raise capital. Moreover, company valuations are also taking a bit hit.  So not only is equity capital harder to find, for companies who do find it, they need to incur substantially more dilution to raise the same amount of money.  As a result, many growth companies are shifting their priorities to slow their growth plans in order to preserve cash and focus on profitability.

So, what are those companies that need capital to scale and grow supposed to do?  

The good news? Flow Capital is aggressively funding high growth companies with our minimally-dilutive capital.

We believe that while markets can be volatile, the digital transformation of industries is permanent.  And we plan on continuing to invest in the best high growth companies we can find.  

Whether you’re looking to bridge to your next round (at a more favourable valuation) or extend cash runway to insulate yourself from the choppy waters ahead, our flexible, minimally-dilutive and covenant light growth capital is the perfect solution.

We invite all growing technology companies, seeking founder-friendly growth capital, to apply for funding.