Venture Lending:
A Dynamic New Funding Source

Venture lending gives startup companies new choices in financing. Not only do you have a new avenue for finding financing, you have dozens of new companies bursting with money -- just waiting for your business plan!

Well, it's a little more complicated than that. But it is a whole lot easier than traditional venture capital investment. Venture lending is the hybrid that makes venture capital firms compete for your business.

Companies like SVB Financial Group, Lighthouse Capital Partners, Hercules Technology Growth Capital, Inc. and Pinnacle Venture are ready with $500,000 to $10 million loans for new and emerging companies. These are loans, not investments.  

There are some strong advantages and disadvantages to this new funding source.

Most importantly, as a loan, they must be repaid. There is a Due Date for every single loan. While most companies believe they can meet that due date, most companies miscalculate just how strong they will be on the due date, leaving the door wide open for greedy investors.

On the plus side, the venture lending companies do indeed make traditional venture capital firms compete. When a solid company goes shopping for funding, there is no doubt at all that the mere presence of one of the venture lending companies throws a big monkey wrench into negotiations.

Use this to your advantage. Whether or not you ultimately opt for a venture loan, talk to them. Find out what all your options.  

And just drop a hint to venture capital companies that there is a venture lending company in your future.

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