Runway Growth Capital formally introduces new loan product for rapidly growing, sponsored and non-sponsored companies, that provides enhanced financing flexibility and reduced borrowing costs.
Managing the financial and operational aspects of a rapidly growing company can be fun, rewarding, challenging and frustrating; all at the same time. It often seems just as one product or upgrade is launched, its replacement is being tested; a new vertical market entered, a new sales team onboarded, or territory entered. And, there are competitors to contend with too. These can be good and exciting business opportunities and it is what feeds our entrepreneurial spirit to be sure.
The dynamic environment of a growth company, while exhilarating, can also make capital planning difficult and a balancing act between ownership dilution, idle cash, and in the case of debt, interest expense and fees. Nonetheless, with financing rounds, equity or debt, it too seems that when one is completed, in relatively short order your team is making plans for the next round of financing. Not only is this time consuming, it can be very expensive in terms of potential dilution, prepayment fees, the acceleration of end of term payments, OID, and recognition of capitalized financing expenses. When structuring a financing it is always a tradeoff between size and cost. In the case of debt financing, availability, principal amortization, and covenants enter into the equation.
The object of every financing round is to get your company to the next stage—that could be from Series B to Series C and a higher valuation, from venture capital to growth equity, to strategic sale or IPO, from venture debt to more traditional lending, to whatever the next rung of the capital markets ladder may be. What if there were a debt facility that grew with your company recognizing its growing creditworthiness and quality? What if there were a way to avoid prepayment penalties, acceleration of end of term payments, and additional dilution to simply extend the interest-only period of your debt facility? What if you could avoid the time involved with seeking proposals and getting to know new lenders?
The EAGLE Facility has landed! Runway Growth Capital introduces the Expandable Adjustable Growth Loan for Enterprise Loan Facility™. For companies advancing rapidly through the “J” curve to sustainable positive cash flow, Runway offers a loan facility that:
- Provides access to predetermined amounts of incremental loan availability;
- Extends interest-only periods and defers principal amortization;
- Automatically rewards company performance with price adjustments to reflect enhanced credit quality
Like you, we recognize acquiring a new customer can cost five times more than retaining an existing customer. We want to keep and reward strong and performing companies in our portfolio and save you the time and cost of refinancing to obtain the financing flexibility your company has earned. The EAGLE Facility™ does just that.
About Runway Growth Capital LLC and Runway Growth Credit Fund Inc.
Runway Growth Capital LLC is the investment advisor to Runway Growth Credit Fund Inc., a lender of growth capital to companies seeking an alternative to raising equity. Led by industry veteran David Spreng, the Fund provides senior term loans of $10 million to $50 million to fast-growing companies based in the United States and Canada. The Fund is a closed-end investment fund that has elected to be regulated as a business development company under the Investment Company Act of 1940. For more on the Fund and its manager, Runway Growth Capital LLC, please visit our website at www.runwaygrowth.com.
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