Venture Debt Market Reaches All-Time High According to Largest Study Ever

Kruze Consulting surveys 85% of the venture debt market, reveals new insights

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Aug 20, 2019, 10:40 ET

SAN FRANCISCO, Aug. 20, 2019 /PRNewswire/ -- Kruze Consulting, a leading CFO consulting company for startups, today released the largest survey of the venture debt market ever conducted. Respondents represent over $25B in venture debt or about 85% of the venture debt dollars invested in the last 3 years. The complete survey along with detailed analysis can be found here.

Scott Orn and Healy Jones organized the largest ever study, capturing over 85% of the venture debt market.

According to the data, the venture debt market almost doubled since 2016 - moving from around $5.5B to over $10B in 2019. 75% of respondents believe that number will grow this year as deal sizes increase. In fact, not a single respondent sees the venture debt market shrinking in 2019. Additionally, respondents expect 2019 to be the largest year ever for venture debt, with lenders aggressively competing for the best startups. Respondents believe firms will do this by offering larger debt deals with more favorable terms and accelerated timelines. The survey also revealed that more than half of the respondents think interest rates will remain low through the end of 2019.

"Venture debt is an important part of funding for many successful startups, so we are excited to see this market continue to grow," said Scott Orn, COO of Kruze Consulting. "Survey respondents indicated a significant degree of positivity, and based on competition in the market, Founders are well positioned for successful funding rounds through 2019."

"The venture debt market has continued to grow, and is a key component of the long term financing needs for top tier venture capital backed technology companies," said Mike Lederman, SVP at Bridge Bank. "Bridge Bank values our relationships in the space and we look forward to continuing to work with Kruze Consulting and their clients."

"Pacific Western Bank's Venture Banking team is proud to contribute to the largest venture debt market survey ever conducted," said Laurie Lumenti Garty, Managing Director and Head of Venture Relations and Startup Services at Pacific Western Bank. "The results of the survey confirms that the venture debt market is an ever growing part of the startup funding ecosystem that provides extreme value to startups and their equity sponsors."

"Thanks to Kruze Consulting for putting this study together," said John Benetti, of the Venture Capital Group at Comerica. "The survey confirms the growth we've seen in the market and we expect that to continue as entrepreneurs and investors continue to realize the value provided through venture debt."

As the largest survey ever, firms from all over the US participated, including Bridge Bank, Pacific Western Bank, Comerica Venture Capital Group and other major banks and funds. By any estimate, respondents to the survey represent more than $25B in venture debt. Kruze Consulting will continue to monitor respondents and conduct additional surveys as the market evolves.

About Kruze Consulting

Kruze provides Startup CFO Consulting to over 170+ startups in Silicon Valley, Los Angeles, New York, and other major startup hubs. To date, Kruze's clients have collectively raised over $2 billion in funding and are market leading Saas, software, eCommerce, eHealth and FinTech startups. Founded in 2012 by Vanessa Kruze, a big four alum, startup controller and CPA, the firm handles all things accounting, tax, finance, & HR. Everything from interim CFO Consulting, financial modeling, startup tax returns, venture debt consulting, 409A valuations, bookkeeping, and Seed/Series A/B Fundraising Preparation can be seamlessly handled by Kruze. Visit https://kruzeconsulting.com/ to learn more.

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SOURCE Kruze Consulting