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Venture Debt Financing

Bridge to your next equity round while minimizing dilution

How It Works

Principal Amount

Average check sizes range from $2-6M

Monthly Payments

Pay fixed monthly interest payments

Fixed Term

Venture debt loans up to 3 years

Typical Venture Debt Agreement Structure

Amount:
$2M+ first tranche; up to $6M in total
Monthly Payment:
Fixed monthly interest
Term:
Up to 3 years
Control Features:
Bespoke
Financial Covenants:
Bespoke
Warrant Coverage:
Light
Security:
Secured by company assets

Is Venture Debt Right for My Business?

Seeking:
$2 million – $6 million
Annual Revenue:
Greater than $4 million; or $2.5 million for companies with recurring revenue business models (ARR)
Regions:
United States
Canada
United Kingdom
Sectors:
Primarily technology;
Open to high-growth companies in other non-tech sectors
Management:
Proven entrepreneurs with substantial ownership positions in their own businesses

FAQs

What is venture debt?

Venture debt sits at a cross between bank debt and equity financing, acting as an alternative or complementary form of debt financing. Fast-growing companies benefit immensely from venture debt by deferring an equity round or to provide extra runway through growing pains.

How long will it take to put venture debt financing in place?

We aim to get your business funded as quickly as possible. Within a week of our initial conversation, we deliver a term sheet for your approval. Once executed, the closing can follow within as little as four weeks.

What types of companies will Flow Capital invest in?

Flow’s venture debt financing is designed for emerging growth companies, generally, including in high growth markets such as technology, SaaS, tech-enabled services, systems, blockchain, AI, big data, regulated cannabis, and healthcare IT.

Are there companies or sectors that Flow Capital does not invest in?

Flow does not invest in companies that operate in the industrial, brick-and-mortar retail, traditional mining extraction, oil and gas extraction, film, and pharmaceutical drug development sectors.

Are there any hidden or ongoing fees?

There are no hidden or ongoing fees. There are legal and initial closing fees at the front-end, which are clearly outlined and agreed upon in advance of any transaction. Flow Capital takes pride in knowing the fees which are levied are substantially lower than the fees associated with traditional alternatives.

What legal fees are involved?

It is not until we agree to move forward that legal fees are incurred. These associated fees are outlined in the executed term sheet and are set at a capped amount. All legal fees are paid upon closing from proceeds of the funding. We have endeavored to mitigate high legal costs by instituting a standardized legal and closing procedure. It is our aim to make every client’s experience as cost-effective as possible.