Definition
Loans provided to venture-backed startups, typically secured by assets or future funding rounds. It's called 'non-dilutive capital,' which really means 'you'll dilute yourself later when you can't pay it back.'
Example Usage
We took on $5M in venture debt to extend our runway without diluting, though the warrants and interest still cost us about 2% equity.
Origin
Financial product developed in the 1980s specifically for venture-backed companies
Fun Fact
Venture debt works great when startups hit milestones but becomes an anchor when they don't—debt doesn't care about your pivot, it wants its money back.
Source: Alternative financing and venture lending practices
Related Terms
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See “venture debt” in Corporate Speak, Gen-Z Slang, Pirate Speak, and more.
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