风险债务：新经济中信贷的上升趋势-波士顿咨询

February2023TRIFECTACAPITALVENTUREDEBT:February2023TRIFECTACAPITALVENTUREDEBT:THERISINGTIDEOFCREDITINTHENEWECONOMYBostonConsultingGrouppartnerswithleadersinbusinessandsocietytotackletheirmostimportantchallengesandcapturetheirgreatestopportunities.BCGwasthepioneerinbusinessstrategywhenitwasfoundedin1963.Today,weworkcloselywithclientstoembraceatransformationalapproachaimedatbenefitingallstakeholders一empoweringorganizationstogrow,buildsustainablecompetitiveadvantage,anddrivepositivesocietalimpact.Ourdiverse,globalteamsbringdeepindustryandfunctionalexpertiseandarangeofperspectivesthatquestiontheys.TRIFECTA CAPITALTrifectaCapitalisIndia'sleadingalternatefinancingplatformforstartupsacrosstheirlifecyclewithtailor-madeVentureDebt,GrowthEquityandFinancialAdvisorySolutions.TrifectaCapitalservesmarketleadersandcategorycreatorsacrossB2B,ConsumerServices,ConsumerBrands,E-commerce,Mobility,Edtech,Agritech,FintechandHealthcare.TrifectaCapitalpioneeredtheassetclassofVentureDebtFundsin2015,bylaunchingthecountry'sfirstVentureDebtFund.Ithassinceprovidedover$500MnofVentureDebtto150+startupsacrossitsthreeFunds.TheFunds'portfolioincludesmanyunicornsandseveralcategoryleadingbusinesseslikeBigBasket,Pharmeasy,Cars24,Vedantu,TheGoodGlammGroup,Infra.Market,Dailyhunt,UrbanCompany,CarDekho,Kreditbee,statusquoandsparkchange.BCGdeliverssolutionsthroughleading-edgemanagementconsulting,technologyanddesign,andcorporateanddigitalventures.Weworkinauniquelycollaborativemodelacrossthefirmandthroughoutalllevelsoftheclientorganization,fueledbythegoalofhelpingourclientsthriveandenablingthemtomaketheworldabetterplace.BharatPe,Cure.fit,GlobalBees,IdeaForge,RebelFoods,StashFin,Open,Kissht,Ninjacart,Chalo,NoBroker,Turtlemint,Udaan,DehaatandLivspace.TrifectaCapitalVentureDebtportfoliocompanieshavecumulativelyraised$13.5Bnofequityandarecumulativelyvaluedat$54Bn.AsofFebruary2023,TrifectaCapitalhasraisedover$600MnacrossthreeVentureDebtFundsandoneGrowthEquityFund.Tosupportstartups,theFirmhasalsobuiltacustomizedtechnologyandadvisoryplatformwithanAUAofover$300Mn.Sinceinception,TrifectaCapitalhasinvestedover$650MnacrossVentureDebtandGrowthEquityandaimstobethefinancialpartnerofchoiceforleadingneweconomycompaniesinIndia.ItcurrentlyhasofficesinNCR,Bengaluru,andMumbai.EXECUTIVESUMMARYThelastfewyearshavewitnessedrecordequityinflowsintotheIndianstartupecosystem,primarilyledbymacroeconomic,technological,andgeopoliticaltailwinds.Duringthesameperiod,VentureDebthasalsogainedpopularityamongIndianstartupsthatarelookingtoraisecapital.SinceCY19,theIndianVentureDebtmarkethasgrownat22%CAGRwithalmost$1BninvestedinCY22.ItsjourneyinIndiaisbeginningtomirrorthetrajectoryofthisassetclassobservedindevelopedmarkets.Asfoundersgetmorefinanciallysophisticated,startupbalancesheetsarenowbeingdesignedtoincludedebtasaformoffinancing.Thishasalsobeenenabledbyahighernumberofdebtprovidersandintroductionofavarietyofproductofferings.Thisisevidencedbythefactthatdespitetherecentfundingwinter,VentureDebtisstillinhighdemandamongstartupfounders.Weareatacrucialinflexionpointtoday.Whiletheimmediatefundingslowdowncanbeanacidtestfordebtinvestments,italsobringswithitanopportunityforfounderstochoosetherightinvestorsandforinvestorstoconsolidateinvestments.MacrotrendsindicatethatIndianVentureDebtinvestmentsaresettogrowto$6BnbyCY30.Additionally,withamorenuancedriskreturnprofile,increasedinvestorinterestindebtinstrumentsandhigherparticipationfromvariedcapitalproviders,theVentureDebtmarketcanpotentiallyleapfrogto$10BnbyCY30.Thiswouldimplya10%shareofprojectedVCinvestments,whichisclosertotheVentureDebtpenetrationseeninmoredevelopedmarketssuchastheUS.Inthisreport,wedelveintotheIndianVentureDebtjourneysofar,prevalentusecases,insightsfromthestartupecosystemondebtfinancingandtheroadahead.Aspartofthereport,weconnectedwith40+startupfoundersandoneofthekeythemesthatstoodoutwasthelimitedawarenessofVentureDebtasaformoffinancing.Thishasbeenoneofthemajordeterrentsinthegrowthofthisassetclass.Foundershavebeenhighlydependentontheirexistingnetworkstogetintroducedtodebtoptions.Eventoday,VentureDebtispredominantlyrecommendedandroutedthroughequityinvestors.However,founderswhohavetakenVentureDebtexpressednumerousbenefitssuchasdealexecutionspeed,availabilityoflargeramountsofcapital,flexibilityofrepaymenttermsandwidereligibilityforcredit.TherearepredominantlyfiveusecasesofdebtfinancingthathavebecomepopularinIndianstartups:@Growth:Expandintonewgeographies,deepenfootprintinexistinggeographies,launchnewproductsornewbusinesses.。M&AFinancing:Boostinorganicgrowthbyacquiringfirmsoperatinginexistingorcomplementarybusinesses.@CapexandProjectFinancing:Meetcapexrequirementssuchaspurchaseofnewwarehousesormanufacturingfacilities,machineryupgrades,strengtheningexistingsupplychain,etc.。WorkingCapitalFinancing:Addressworkingcapitalrequirementsofoperationalexpensessuchaspurchasingrawmaterials,financingreceivables,etc.©OnwardLending:ProvidefundstoFintechsoperatinginthelendingspacetobuildouttheirloanportfolio.Recognizingthisopportunity,bankshavealsoforayedintoprovidingbankingsolutionsandservicescustomizedtotheneedsofstartups.Inaddition,banksaregraduallygettingintoofferingsomeformsofcredittostartupsaswellincludingselectproductssuchasworkingcapitalloans.RegulatorysupporttoenableflexibilityinunderwritingandrepaymentnormscanhelpdrivefurtherparticipationofbanksintoIndia'sVentureDebtecosystem.Interestforprivatecreditandalternativeinvestmentshasalsoincreasedamongdifferentcategoriesofinvestorsinthelast5years.Predictablecashflows,anattractiverisk-returnprofileandpotentialforequityupsidehasledtoasizableallocationofVentureDebtwithinalternativeinvestmentportfolios.Asoftoday,thepreferredmodeofengagementformostindividualandinstitutionalcapitalprovidersisthroughspecialistfunds.VentureDebtinvestmentscatertodifferentkindsoflimitedpartnersindifferentways:。Insurancecompanies:PredictablereturnsandregularcashflowsfromVentureDebtsupportsforward-lookingestimationforinsurancecompanies.(2Endowmentfunds:RegularcashflowsprovidedbyVentureDebtinvestmentshelpmanageoperationalexpensesofendowmentfunds.©HNIsandfamilyoffices:VentureDebtenablesriskdiversificationinthealternateinvestmentportfoliooffamilyoffices.Italsohelpstraditionalbusinesshousesinexploringinvestmentsinnew-agebusinesses.。DevelopmentFinanceInstitutions:Italignswiththeobjectivesoftheseinstitutionstoexpandtheavailabilityofcredittothestartupecosystemthathaslargelybeenunder-servedbytraditionallenders.@Banks:Presentunderwritingmodelsdonotalignwithstartupbusinessmodels.VentureDebthelpsbuildstartups'credithistory,therebymakingthemgraduallyeligibleforbankloans.Asbothglobalanddomesticinvestorsconsiderincreasingtheirportfolioallocationtowardsprivatecredit,VentureDebthasemergedasoneoftheleadingsegmentsdrivingtheseinvestments.ThefollowingleversofdemandandsupplywillpropelthenextwaveofgrowthinVentureDebt.EnablersforgrowthindemandIncreasedawareness:Higherawarenessamongstartupfounders,venturecapitalprovidersaboutproductfeatures,usecasesandaccessibility.Productinnovation:Tailor-madesolutionstosolveforspecificfinancingneedsofastartup,beyondtraditionaldebt.Increasedcollaboration:DeeperrelationshipsofVentureDebtproviderswithotherinvestorssuchasVenturecapitalfirms,Banks,NBFCs,PrivateCreditfunds,etc.toleverageeachothers'strengthsindistribution,costofcapital,etc.EnablersforgrowthinsupplyofcapitalBroadenedinvestorpool:AwiderarrayofinvestorsinVentureDebt,suchasglobalinstitutions,willhelptofulfillincreasingcapitalneedsoftheecosystem.Increaseinallocation:AsteadytrackrecordofperformanceofVentureDebtfundsacrossvintageswillpowerhigherportfolioallocationstowardsVentureDebt.Withtheaboveenablersandcontinuedregulatorysupport,VentureDebtiswellplacedforanexponentialgrowthtrajectory.ItisanassetclasswhosetimehaswellandtrulycomeinIndia.BCGBCG+TrifectaCapitalTABLEOFCONTENTSSTARTUPSB08-15VENTUREDEBT:SCALINGALONGWITHCURRENTLANDSCAPEANDPERCEPTIONSfl16-45THENEXTHORIZON:UNLOCKINGTHEFULLPOTENTIALfl46-51彳VENTUREDEBT:丄SCALINGALONGWITHSTARTUPSHowcreditisbecomingmainstreamforIndianstartupsVENTUREDEBT：THERISINGTIDEOFCREDITINTHENEWECONOMYVENTUREDEBT:SCALINGALONGWITHSTARTUPS|VENTUREDEBT:SCALINGALONGWITHSTARTUPS|IVENTUREDEBT：THERISINGTIDEOFCREDITINTHENEWECONOMYBCG+TrifectaCapital顷CURRENTLANDSCAPEBCG+TrifectaCapital2D.Perspectives:InvestorsCURRENTLANDSCAPEANDPERCEPTIONS|37InvestorsreportasharedperceptionofattractiveRiskAdjustedReturnsInvestorsreportasharedperceptionofattractiveRiskAdjustedReturns。Highcreditquality,diversifiedportfolioandalmostzerodelinquency◊SpecializedunderwritingthroughinvestmentinTier-1VCbackedstartups•CoupondistributionsprovidepredictablecashflowswithequitykickersfurtherimprovingIRRsVentureDebtmeetscashflowexpectationsofinsurancefirms,endowmentfunds©) : 'InsuranceCompaniesOVentureDebtprovidesdownsideprotectionforinsurancecompanyinvestorsastheyaretypicallymorefocussedoncapitalpreservationPeriodicdistributionfromVentureDebtprovidespredictablereturnsAdditionally,cashflowsinVentureDebtsupportsforwardlookingestimationandreporting\: )JEndowmentFunds9DownsideriskprotectionisofparamountimportanceforendowmentsOEquityupsidefurtherhelpstomakethisassetclassmoreattractivethantypicaldebtproducts0RegularcashflowsforendowmentfundshelpswithmanagingopexduetotheneedtofundtheirP&L0PeriodiccashflowdistributionsaremorefavorablecomparedtoventurecapitalcashflowswhichfollowasteeperJ-CurvepatternX. )HNIs,Familyoffices,DFIsparticipateindebtfinancingtostartupsthroughVentureDebt,nnnH^ 、*HNI's&FamilyOfficespFamilyofficestypicallygetbetterdealflowaccessthroughaVentureDebtfundpartnerascomparedtodirectorigination<•VentureDebtenablesriskdiversificationinthealternateinvestmentbucket0Selectiveparticipationavailableindirectco-investmentthrougheitherdebtorequity6Opportunityfortraditionalbusinesshousestoexplorestrategicinitiativeswithnew-agebusinesses\ )JDomesticFinancialInstitutions(DFIs)DFIsaremandatedtochannelcredittotheunder-suppliedstartupecosystem,whichisintegraltotheeconomy'sgrowthDFIs,suchasSIDBI,facilitateincrementalcapitalallocation,whichhasamultipliereffect,astheymandatetheirfundstoinvesttwiceoftheirFoF'scontribution,providingadditionalcapitaltostartupsVentureDebt'sprofilesupportsDFIs'strategytobeselfsustainingwithearlyperiodicrepayments,ascomparedtoVentureCapital'sdelayedfundpayouts,whichcouldbeusedforreinvestmentintootherfocusareasVenturedebtprovidesagoodcombinationofriskandreturns.Fixedincomelikedistributionsalongwithanalphatotypicaldebtreturnmakesitattractive.一SriramMahadevan,Principal-EndowmentInvestmentGroupAzimPremjiFoundationWe'veseenVentureDebtevolveoverlast7-8yearsinourjourneywithTrifecta.Ithasbeenabletofillalargevacuuminthedebtmarketbetweenhighyield/high-riskoptionslikerealestatenCdsandtraditionallowyieldinstruments.CEO,一PankajDinodia,DinodiaPartnersSource:BCG-TrifectaInteractionswithinvestorsCURRENTLANDSCAPEANDPERCEPTIONS39VentureDebtfundshelpbuildstartup'screditworthinessforbankloansBanks<•VentureDebthelpsfuelbanks'coverageofthestartupecosystem<•Currentbankunderwritingmodelsarenotfullyalignedwithstartupbusinessmodelswhichtypicallyconsumecashduringtheirgrowthphase<•VentureDebthelpsstartupsbuildacredithistory,eventuallybringingthemintotheformalbankingcreditfold\ )RBLBankhasbeenapartnerandenablertothestartupecosystemforseveralyears.WithourinvestmentinTrifecta'sfund,wegetawindowintotheworldofadiversesetofstartups,investmentthemesandVCtrends,inadditiontogeneratingstrongriskadjustedreturns.一RajeevAhuja,ExecutiveDirector,RBLBankAsthebroaderVentureecosystemhasmaturedandawarenessonVentureDebthasincreased,we'veseenseveralcategoriesofinvestorsallocatetowardsVentureDebt.Whilethereisasignificantpotentialtodeepenpenetrationwithinexistingcapitalpools,tappingintonewcapitalpools,includingglobalcapitalisalargeopportunity.一NileshKothari,ManagingPartner,TrifectaCapitalThisassetclassiswell-suitedtocatertoourneedsofyieldandportfoliodiversification.ThequarterlydistributionsareconvenientThisassetclassiswell-suitedtocatertoourneedsofyieldandportfoliodiversification.Thequarterlydistributionsareconvenientandhelpusinourincomegoals.Theilliquidnatureoftheassetclassiscompensatedbypotentiallyhigherreturns.一MihirVora,Sr.Director&ChiefInvestmentOfficerMaxLifeInsuranceCURRENTLANDSCAPEANDPERCEPTIONS41Investorsshowcasedhigherappetiteforalternativesinlast5years®:6keyfactorsleadingtoincreasedinterestinprivatecredit&alternativesOCreditmutualfundsAUMdroppedbymorethan50%inlast2-3years<>YieldsdroppedacrosstenuresforAAApapersby75-80bpssince2019-20<•IndianAIFshavegrownto$90BnofAUMcomparedto$500Bninmutualfunds.Further,largeglobalpoolsofequityalsoenteringIndia<•Recentgoodperformanceofalternativeinvestmentfundslikeventurecapital,VentureDebt6DebtAIFsacrossvintagedelivereddoubledigitIRR,outperformeddebtmarketindexi.e.CRISILCompositeBondFundIndex6IncreasedaccesswithexponentialincreaseinSEBIregisteredAIFs(50%+ofAIFsregisteredinlast4years)VentureDebt:Anew-agepropositionwithinalternativeinvestmentlandscape<•Relativelynewwithnearly$1Bnannualmarketsize,growingat22%CAGR<•TapsintothehighpotentialspaceofIndianstartupecosystem-3rdlargestintheworldwith100+unicorns6Strongacceptanceoftheproductintheecosysteminlast2-3years6Promisinggrowthtrajectory,expectedtomirrortheUSVentureDebtmarket\ )Source:BCG-TrifectaInteractionswithinvestors,Trifectaanalysis

aTotalportfolioVentureDebtisakeypartofalternateinvestmentallocationforIndianinvestorsaTotalportfolioAssetallocationofdifferentinvestorgroupsvariesbasisriskandreturnexpectations,cashflowrequirementsandstrategicgoals.Portfolioallocationtoalternativeassetsobserved:OIndianHNIsandFamilyOffices:5-20%•IndianBanksandInsuranceCompanies:<2%OGlobalPension,Endowment,Sovereignfunds:<20%o Upto20%allocatedtoalternateinvestments °AllocationtowardsPrivatecredito•Globalinvestorshaveallocated$200Bn+p.a.towardsprivatecredit,outofwhichIndiaaccountsfor$4-5BnOUnlikeequityfunds,topglobalprivatecreditfundsareaccessibletoIndianinvestorsOVentureDebt,performingmid-marketcreditandspecialsituationsinvestingaresomecommonstrategiesoPrivateequity,hedgefunds,venturecapitalQHNIsandnewerinvestorsoftenenteralternativeassetsthroughequity,awarenessofcredittypicallyfollows0PE,VCstrategiesavailabletoinvestorsOGlobalfundmanagersnoteasilyaccessibletoIndianinvestors6VentureDebtiswellplacedwithinprivatecreditOVentureDebtallocationbyFamilyOfficesrangesfrom30-100%ofalternativedebtinvestments8Unliketraditionalprivatecreditforglobalpensionfunds,VentureDebthaspotentialtoattractsubstantialinflowsinthenext3-5yearsSource:BCG-TrifectaInteractionswithinvestors42IVENTUREDEBT：THERISINGTIDEOFCREDITINTHENEWECONOMY

EvolutionofVentureDebtFundsinIndiaICumulativeVentureDebtAssetClassinIndia$1,302Mn$1,102Mn$407Mn$213MnCY18CY19CY21CY22$76MnCY15ALTERIACAPITALLaunchofALTERIACAPITALLaunchofAlteriaCapitalVentureDebtFundI$137MnSTRIDEVENTURESVentureDebtFundII$200MnOTRIFECTACAPITALLaunchofTrifectaCapitalVentureDebtFundI$76MnOTRIFECTACAPITALVentureDebtFundII$144MnOTRIFECTACAPITALVentureDebtFundIII$250MnOSTRIDEVENTURESLaunchofStrideVenturesVentureDebtFundI$50MnOINNOVENCAPITALLaunchofInnovenCapitalVentureDebtFundI$200MnOALTERIACAPITALVentureDebtFundII$245MnNote:ThecumulativeVentureDebtfunddatacomprisesoffundsraisedbyTrifectaCapital,AlteriaCapital,StrideVenturesandInnovenCapitalSource:BCG-Trifectaanalysis44IVENTUREDEBT：THERISINGTIDEOFCREDITINTHENEWECONOMY

TrifectaCapitalactingasacatalystinfurtherexpandingproductofferingsacrossastartup'slifecycle2015onwards2020onwards2021onwards2015onwards2020onwards2021onwardsVentureDebtFundFinancialAdvisory

ServicesGrowthEquityVentureDebtFundFinancialAdvisory

ServicesGrowthEquity1stplayerinIndianstartupecosystemtoofferVentureDebttostartups•Over$500MnVentureDebtfundraisedtilldate1stplayerinIndianstartupecosystemtoofferVentureDebttostartups•Over$500MnVentureDebtfundraisedtilldate•Portfolioof150+companiesacrossindustriesStartedfinancialadvisory&otherserviceofferingsO40+startupsleveragingTreasuryManagementservices•AccesstoleadingmembersofthestartupinvestorecosystemGraduallyprogressingintogrowthequityfundingforstartupsO1stfundof$250Mnraised&investedinDailyhunt,Livspace,Cars24,etc.•Targetedtowardsgrowthorlate-stagetech-basedstartups.. Wehavesourcedasignificantnumberofinvestmentsincategoryleadingtechnologycompanieswithstronguniteconomicsandclearpathtoatime-boundliquidityeventfromTrifecta'sVentureDebtPortfolio.—LavanyaAshok.. Wehavesourcedasignificantnumberofinvestmentsincategoryleadingtechnologycompanieswithstronguniteconomicsandclearpathtoatime-boundliquidityeventfromTrifecta'sVentureDebtPortfolio.—LavanyaAshok&SandeepBapat,Partners,GrowthEquityTrifectaCapitalVentureDebtcomplementsourGrowthEquityandFinancialAdvisorystrategies,allowingustoofferservicesacrossthelifecycleofnew-agecompanies.—AbhishekGupta,Partner,TrifectaCapitalSource:BCGanalysisCURRENTLANDSCAPEANDPERCEPTIONS45BCG+TrifectaCapital以THENEXTHORIZON:◎unlockingthefullPOTENTIALPrimaryleversforgrowth46IVENTUREDEBT：THERISINGTIDEOFCREDITINTHENEWECONOMYIndianVentureDebtinvestmentcanpotentiallyreach$10BnbyCY30EstimatedgrowthofVentureDebtinvestmentsinIndia($Bn)0.260.87CY21CY20106-70.80-0.85CY22ECY30E8-10%3%Potentialtoreach$10BnofcreditflowswithafocusedsystemicefforttoincreasedemandandachievehighersupplyofcapitalBasecasescenarioofreaching$6-7BnVentureDebtinvestmentsannuallyVentureDebtfundingas%ofVCfunding3%2%VCfunding($Bn)10393180-100VCas%ofGDP0.4%1.2%0.9%1-2%Source:BCGanalysisVentureDebtpenetrationasa%ofVentureCapitalflowsexpectedtoincreasewithtimeastheassetclass&ecosystemevolvesVentureDebtintheUShasreached15-20%penetrationofVentureCapitaloverthelastfewdecadesWithacceleratedVCfundinggrowthandrapidactivationofdemand-supplyenablers,theVentureDebtassetclasshaspotentialtogrowto$10BnofannualinvestmentflowsbyCY30THENEXTHORIZON：UNLOCKINGTHEFULLPOTENTIAL|47Macrotrendsindicateatleast5xgrowthpotentialofVentureDebtasaproportionofVCflowsbyCY30(AllfiguresrelatetoCY21)GDPNoofstartups1VentureDebtsize(%ofVCflows)VCinvestments(%ofGDP)US$22,996Bn$342Bn(1.5%)$33Bn(10%)57,083INDIA$3,084Bn$38.5Bn(AllfiguresrelatetoCY21)GDPNoofstartups1VentureDebtsize(%ofVCflows)VCinvestments(%ofGDP)US$22,996Bn$342Bn(1.5%)$33Bn(10%)57,083INDIA$3,084Bn$38.5Bn(1.1%)VCinvestmentsaspercentageofGDPinIndiacameclosetotheUSbenchmarksin2021,arecord-settingyearforinvestmentsacrossbothgeographies•$0.87Bn(2%)6,837IntheUS,VentureDebtinvestmentsaccountedfor~15%ofVCcapitaldeploymentWithactivatedgrowthenablers,Indiahas5XgrowthpotentialforVentureDebttoreach~10%ofVCcapitaldeploymentbyCY30,makingita$6-10Bnindustry1.AsonAugust24th2022;Startupcriteriaused:Backingstatus-VC/Incubator/Angel,Ownershipstatus-privatelyheldSource:Preqin,Pitchbook,OxfordEconomics,VentureIntelligence,Tracxn;BCGanalysis48IVENTUREDEBT：THERISINGTIDEOFCREDITINTHENEWECONOMYGrowthenablers:DemandGrowthenablers:DemandIncreaseawarenessintheecosystemTodayfoundersrelyontheirexistingnetworkforchoosingVentureDebt.Toenablefastergrowth,itisimportanttotakestepstowardsbuildingawarenessoftheproductfeatures,usecases,accessibilityandimplicationsofitskeyterms.Evangelizinginteractivemodesofengagementsuchasworkshops,seminars,blogswillpromotedeeperknowledgeofthisassetclassasaformoffinancing.UnlocknewcreditstructuresWhiledebtfinancinggainsmomentuminIndia,curatingneed-basedfinancialsolutionswillbekeytoenablehigherinterestamongfounders.Workingcapitallines,project-basedfinancing,alongwithco-lending,growthstagedebtandacquisitionsfinancingaresomeleadingexamples.Beyondthis,financialtoolsforfounderstobetterunderstandandoptimizecostofcapitalisavitalneedinthemarketthatcanbeadressed.IncreaseawarenessintheecosystemTodayfoundersrelyontheirexistingnetworkforchoosingVentureDebt.Toenablefastergrowth,itisimportanttotakestepstowardsbuildingawarenessoftheproductfeatures,usecases,accessibilityandimplicationsofitskeyterms.Evangelizinginteractivemodesofengagementsuchasworkshops,seminars,blogswillpromotedeeperknowledgeofthisassetclassasaformoffinancing.UnlocknewcreditstructuresWhiledebtfinancinggainsmomentuminIndia,curatingneed-basedfinancialsolutionswillbekeytoenablehigherinterestamongfounders.Workingcapitallines,project-basedfinancing,alongwithco-lending,growthstagedebtandacquisitionsfinancingaresomeleadingexamples.Beyondthis,financialtoolsforfounderstobetterunderstandandoptimizecostofcapitalisavitalneedinthemarketthatcanbeadressed.50VENTUREDEBT:THERISINGTIDEOFCREDITINTHENEWECONOMY

Growthenablers:SupplyofCapitalBroadentheinvestorpoolAstheindustrymatures,expandingthearrayofinvestorsparticipatinginVentureDebtfundswillfuelthegrowingcapitalrequirements.Thisincludesbuildinginvestmentvehiclestructuresthatcandrawglobalinstitutionalcapitalsuchasmultifamilyoffices,pensionfunds,sovereigns,endowments,etc.toVentureDebt.

StrengthenpresenceinexistinginvestorgroupsWhileinvestorsareconsideringVentureDebtasapartoftheiroverallportfolio,increasedawarenesswilldriverhigherallocationtowardsthisassetclass.ThiswillbefurtheraidedbydemonstratingasuccessfultrackrecordofVentureDebtinvestmentsacrosssectorsandticketsizes,overthe