Growth finance · Updated 2026
Venture Debt Providers: Terms, Warrants, and How to Compare Offers
Venture debt is a loan to a venture-backed company, usually sized at 20%–35% of the most recent equity round, priced at prime plus 100–500 basis points, and paired with warrant coverage of 0.5%–2.0% of the facility amount. It extends runway without diluting the cap table materially, but it adds fixed obligations to a company that is still burning cash.
By the Coyote Wealth Editorial Team — researchers and writers with experience across leading Wall Street financial institutions. Updated August 8, 2026.
Coyote Wealth data point
27%
Median venture debt facility size as a share of the prior equity round (Coyote Wealth 2026 estimate)
Based on Coyote Wealth's review of 38 venture debt facilities reported by founders and lenders between Q1 2025 and Q2 2026. Series A borrowers cluster at 20%–25% of the round; Series C and later borrowers with recurring revenue reach 35%–50% when the facility is underwritten against ARR rather than the equity raise.
10 active venture debt providers
Hercules Capital
Focus: Growth-stage venture lending across technology and life sciences
HQ: San Mateo, CA
- Facility size:
- $5M–$100M+
Publicly traded BDC and one of the largest dedicated venture lenders, with a life-sciences practice that few competitors match at scale.
Trinity Capital
Focus: Growth loans and equipment financing
HQ: Phoenix, AZ
- Facility size:
- $5M–$50M
Flexible across term loans and equipment finance, useful for hardware and capital-intensive businesses that pure software lenders decline.
Horizon Technology Finance
Focus: Technology, life science, healthcare IT
HQ: Farmington, CT
- Facility size:
- $5M–$50M
Long-standing BDC lender with a track record across multiple venture cycles, including the 2022–2023 downturn.
TriplePoint Capital
Focus: Venture growth-stage lending
HQ: Menlo Park, CA
- Facility size:
- $5M–$50M
Relationship-driven lender that frequently commits early and scales the facility across rounds.
Runway Growth Capital
Focus: Late-stage growth loans, minimal warrants
HQ: Woodside, CA
- Facility size:
- $10M–$75M
Positions on lower warrant coverage and larger, later-stage credits — worth a look when dilution sensitivity is the deciding factor.
Stifel Venture Banking
Focus: Bank-provided venture lending and treasury
HQ: St. Louis, MO
- Facility size:
- $3M–$50M
Bank platform assembled from experienced venture bankers; cheaper than a BDC but with tighter covenants and deposit relationship expectations.
HSBC Innovation Banking
Focus: Bank venture lending, global coverage
HQ: Global / San Francisco, CA
- Facility size:
- $3M–$75M
Global bank footprint for companies with UK, EU, or Asia operations that need banking and lending in multiple jurisdictions.
Bridge Bank (Western Alliance)
Focus: Venture lending and working capital
HQ: San Jose, CA
- Facility size:
- $2M–$30M
Active bank lender across early and growth stages with a long-established Silicon Valley technology practice.
Espresso Capital
Focus: Non-dilutive lines for SaaS
HQ: Toronto, ON
- Facility size:
- $1M–$30M
Frequently lends without warrants against ARR, which suits capital-efficient SaaS companies not raising a large priced round.
Applied Real Intelligence (A.R.I.)
Focus: Venture debt for underrepresented and non-coastal founders
HQ: Los Angeles, CA
- Facility size:
- $1M–$10M
Smaller check sizes with an explicit mandate to serve founders outside the traditional venture-lending network.
Also active in venture lending: SVB (now part of First Citizens), Comerica, J.P. Morgan Innovation Economy, Silicon Valley Bridge lenders, Arc, Pipe, and revenue-based financing platforms. Inclusion is editorial and is not an endorsement or a solicitation.
The five terms that determine what venture debt really costs
Interest rate
Prime plus 100–500 bps for bank lenders; 11%–14% fixed-equivalent for BDC lenders taking more risk. Banks are cheaper and stricter.
Warrant coverage
0.5%–2.0% of the facility amount, struck at the last round price. On a $10M facility at 1.5% coverage, that is $150,000 of warrants — modest dilution, but it is real.
Interest-only period
6–24 months before amortization begins. This is the single most valuable term for a company optimizing runway, and it is negotiable.
Final payment / end-of-term fee
2%–8% of the facility due at maturity. Frequently overlooked when founders compare headline rates.
Material adverse change clause
A broadly drafted MAC clause lets a lender restrict draws when you most need them. Narrow it, cap it, or price the risk of it.
When venture debt is the right tool
Venture debt works best as an extension, not a rescue. The classic use is taking a Series B company with 14 months of runway to 20 months so it can hit a milestone that materially re-rates the next round. The math works because the interest cost is far cheaper than the equity dilution of raising at a flat valuation.
It works poorly when the company has no credible path to either profitability or a next round inside the facility term. Amortization typically starts within a year, and a burning company paying principal is spending equity dollars on debt service. Lenders in this market underwrite the quality of the existing investor syndicate almost as heavily as the company's metrics.
Bank lender versus BDC lender
Banks
Lower rate, lower or no warrants, deposit relationship required, tighter covenants, and faster to pull back in a downturn.
BDCs and specialty funds
Higher rate and warrant coverage, but larger facilities, more risk tolerance, and no requirement to move your operating accounts.
Revenue-based financing
No warrants and no covenants, but effective annualized cost of 15%–25% and short repayment windows. A working-capital tool, not a runway tool.
Methodology and limitations
- Lenders are included based on active origination in venture-backed technology and life-sciences credits during the trailing 24 months and disclosed facility ranges.
- Term ranges are Coyote Wealth estimates from 38 founder- and lender-reported facilities, Q1 2025 – Q2 2026, not audited market data.
- This page is informational. It is not a recommendation of any lender, financing, or security.
- Limitations: venture debt terms vary sharply by stage, sector, and investor syndicate, and headline rates rarely capture end-of-term fees or warrant value.
No firm paid for inclusion or placement. Coyote Wealth does not manage money, administer funds, or sell financial products. Figures are editorial estimates drawn from public disclosures and practitioner interviews, not audited data. Corrections: contact the editorial desk.
Frequently asked questions
What is venture debt?
Venture debt is a term loan or credit facility extended to a venture-backed company, typically alongside or shortly after an equity round. It is repaid with interest and usually includes warrants, giving the lender a small equity upside in exchange for accepting risk a traditional bank would not.
How much venture debt can a startup raise?
Coyote Wealth estimates a median facility of 27% of the most recent equity round in 2026. Series A companies typically access 20%–25%; later-stage companies with predictable recurring revenue can reach 35%–50% when the facility is underwritten against ARR.
What interest rate does venture debt charge?
Bank venture lenders generally price at prime plus 100–500 basis points. Specialty lenders and BDCs price higher, often equivalent to 11%–14% fixed, plus a 2%–8% end-of-term fee and 0.5%–2.0% warrant coverage.
Is venture debt dilutive?
Mildly. Warrant coverage of 0.5%–2.0% of the facility amount is far less dilutive than raising the equivalent amount in equity, which is the main reason companies use it. The real cost is the fixed repayment obligation, not the dilution.
When should a startup avoid venture debt?
Avoid it when there is no credible path to a next round or profitability within the facility term, when amortization begins before the company expects a milestone, or when the lender insists on a broad material adverse change clause that lets it restrict draws during a downturn.
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