Growth and Venture Debt

This report examines the expanding opportunities in growth and venture debt as private credit alternatives to equity financing. It highlights the asset class's structural protections and the shift in market dynamics following the 2023 regional banking disruption.

Key Takeaways

• 1.Growth and venture debt are expanding areas within global private credit portfolios, driven by high-quality opportunities in tech and healthcare.
• 2.The rising cost of equity financing has increased the appeal of debt for growth-backed companies seeking to avoid valuation dilution.
• 3.Loan structures in this asset class offer downside protection through senior security and amortization, while providing upside via equity warrants.

Table of Contents

• Financing tomorrow's growth
• Authors
• Key takeaways
• Introduction
• Q: To start, how do you define growth and venture debt?
• Q: How are they different?
• Q: What do people sometimes get wrong about growth and venture debt?
• Appetite for capital
• Q: What macroeconomic forces do you see driving the expansion of growth and venture debt opportunities?
• Q: What opportunities are you seeing in the space? What risks?
• Shifting opportunities
• Q: How should investors think about growth and venture debt as part of a private debt portfolio?
• Q: Are there any significant changes that have taken place in growth and venture debt in recent years?
• Q: What is the final message you'd leave investors with about growth and venture debt?
• Fund Specific Risks
• IMPORTANT INFORMATION

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