Venture Debt - Loan origination & servicing + Case study
Hi, I'm currently interviewing at a venture financing firm focused on venture debt, and was wondering if you guys have some advice on loan origination & servicing. For instance, what should I look at specifically in terms of:
cash balance
financial projections
burn
break even/profitability
anything else?
and how to determine loan amount, duration, IR, interest only period from that?
Also if anyone knows how to prepare for a venture debt case study or point me in the right direction that would be fantastic! Thank you!
Not too versed in this but at the early venture stages things differ wildly. What sector is the company in for this case study? Is this a newly seeded tech company or a biotech that has had three rounds of financing but is still nowhere near turning out a drug?
For say a SaaS / ecommerce or consumer business
Maybe structure the debt amount based on ARR as a lot of the tech buyouts are structured based on ARR multiples. Duration is probably 3-5 years as a lot of these venture debt transactions are bridging the company to its next capital event (e.g. IPO, equity round, sale, etc.). Return is likely in the HSD or LDD ballpark (cash / PIK with some warrants upside). Also the size of the firm matters a lot too - small venture debt and large venture debt are fairly different
Disclaimer: I am not really in the space either so take it with a grain of salt.
Hey, I also have a venture debt case study coming up and wanted to find out if you were able to share any info on what your case study was like? Thanks!
Et tempore voluptate perferendis incidunt dolorum repellat. Adipisci rerum sapiente non dignissimos. Iusto consectetur rerum itaque autem ad. Non rerum aut enim voluptates magnam illo excepturi. Distinctio libero nesciunt et doloremque ut est. Laboriosam cum totam ducimus nobis. Eum odit sunt nostrum qui perferendis enim.
Ab temporibus ipsa voluptas est est exercitationem fuga. Quia nisi aliquid est itaque eveniet tempore facere. Sit nemo rem quos consectetur nisi. Ut excepturi quo sapiente neque eum rem.
Illo illo dolore molestiae saepe qui quo aut. Nisi quo doloremque nobis voluptas voluptas est unde. Velit voluptate totam quisquam modi id tempora. Ratione labore ut soluta aut qui asperiores. Delectus delectus ratione praesentium sint assumenda incidunt.
Et dolore laboriosam cupiditate deserunt sed. Occaecati eum magni doloribus est maxime amet ipsa.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...