Reaching milestones with less runway: How this AI startup used venture debt to fuel customer acquisition
Summary
As he looked to fund the next stage of growth for his tech platform, in a softer climate for startup investment, Taylor needed to make a call. “Debt enables shareholders, including founders, to improve their returns but still get the benefits of bringing on a venture growth investor, without giving up control of their business. “Even though we’re not profitable just yet, with growth credit we can model what our repayments will look like, giving us the ability to manage the facility and service that debt over time.” Steadying interest rates should see the return of stronger valuations for high-quality high-growth companies. But an improving economic environment will also see the cost of credit fall and OneVentures’ Gainsley expects the funding format to become increasingly popular as the market matures and awareness builds. “They have predictability around their businesses as opposed to early-venture startups.” Gainsley says Taylor and his team at Particular Audience have shown how their solution will drive material returns for retailers and reduce their costs – something that’s even more important in the current market.