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Understanding Venture Debt: A Strategic Financing Option For Indian Startups

Inc42 · 1y

Venture debt has become a popular financing option for startups in India. Traditional lenders often have strict criteria for loan eligibility, making it difficult for startups to secure funds. Venture debt offers multiple advantages, such as preserving equity and providing access to additional capital without diluting equity. It also allows for quick turnaround in securing funds and facilitates international expansion. However, startups must be aware of default risks and higher interest rates associated with venture debt. Overall, venture debt plays a crucial role in supporting the growth and innovation of Indian startups.