Experts say project debt lenders will play a major role in firefighting and closing this year’s start -up start
When holding a startup seat accounting Suddenly Last month, the closure was forced when the company’s lenders were Call in the startup loan. In late 2023, digital shipping company convoy It faced financial challenges, and the leadership of the Hercules Capital project to bear control of the company to restore its investments.
Divided homes, which were sold for about 1 billion dollars To Brookfield Properties last week, he left some of the company’s shareholders Without any paymentsTECHRUNCH reported last week. Although the specific role of DivVy lenders in the sale is not clear, the company We borrowed $ 735 million From Barclays, Goldman Sachs, the bank of the Cross River, and others in 2021.
After financing many weak startups in 2020 and 2021 with Famous careMany of the weakest companies already failed. but The data indicates that we have not yet reached the bottom, and many will die in 2025. The project debt plays a role after investing $ 41 billion in 2,339 deals, which is a record time in 2021, According to the Silicon Valley Bank.
“We have reached the end of the rope for many companies,” said David Spring, founder and executive director of Venture Debt Rantenway Capital.
Spreg believes that lenders are increasingly pushing startups to sell themselves to reduce possible losses, and Spring also believes that lenders are increasingly paying startups to sell themselves to reduce potential losses to the future of their investments, so lenders are increasingly pushing startups to sell themselves to reduce potential losses.
Almost every lender is estimated to be turbulent companies in its wallet now, and John Marcil, the administrative partner of the ARMENTUM PARTNERS consultant debt consultant.
While debts can help startups to meet their cash needs without selling the company’s pieces to VCS, they also increase The risk of negative results. A lot of debts can lead compared to the startup or cash reserves to sell a forced fire, as the company is sold for a small part of its previous value. Or lenders may resort to mortgage, so that they can claim any basic assets used to secure the loan, to recover at least some of their investments.
If startups can persuade the new or current VCS to inject more cash by buying more shares, they can avoid taking measures in case of taking action behind payments or other aspects of their agreements. For example, some Adventure debt agreements It has the requirements for liquidity and working capital. If the startup cash decreases, the lender may take a procedure.
But investors are reluctant to finance startups that grow very slowly to justify the high assessments they achieved in 2020 and 2021.
“At the present time, there are many troubled companies,” Markle said. “Many of the unilateral work at work will not be soon.”
Spreg also expects that many startups will have no choice but to sell at a low price or turn it off this year. But at the present time, most lenders still hope that these emerging companies can find a house through a sale, and even the sale of fires.
In the positions in which lenders are forced to take the acquisition, stock investors do not generally get many of the money that is paid, and they often do not earn their money, as Marcil said. Losses in investments in startups are risks that the capitalists will know.
When a sale occurs, Spherg says many of these transactions are still unannounced due to the unfavorable results of investors. Nobody wants to take the bosom of victory when they lose money in the sale.
However, given that debt holders have a priority in payment, it is unlikely that the project lender will lose all their capital.
But the risks associated with adventure did not slow down. In 2024, the issuance of a new project debt reached the highest level in 10 years of $ 53.3 billion, according to what it said Pitchbook data. A large part of the capital was directed to artificial intelligence companies, with remarkable examples, including Coreave, which received $ 7.5 billion of debt financing, and Openai, which got 4 billion dollars from the credit line.
