Venturing Into the Valuation of Venture Debt

June 18, 2023

With the collapse of Silicon Valley Bank (SVB) in March 2023, a spotlight was shone on the $6.7 billion of venture debt on its balance sheet, which represented approximately 20% of the total venture debt deal value of $34.1 billion in 2022. SVB had amassed significant levels of bank deposits from its customers by offering flexible terms and rates and bespoke venture debt solutions to its borrowers relative to other private credit lenders.

With SVB’s failure, nonbank lenders such as Hercules Capital (NYSE:HTGC), TriplePoint Venture Growth (NYSE:TPVG), and new entrant Blackstone are expected to fill the void, albeit at higher rates and tighter terms. On TriplePoint’s Q1 2023 earnings call, CEO James Labe said, ”The departure of SVB has also resulted in increased deal flow…which also includes providing newer replacement loans previously received from banks.”

Per PitchBook, venture debt surpassed $30 billion in deal value for the fourth consecutive year in 2022 and approximated a fourfold increase in deal value over the past decade. With the capital demand to supply ratio at a record 3.2x and 1.6x for late-stage and early-stage companies, respectively, as of Q1 2023, new venture debt demand is expected to remain elevated in the near to medium term.

Learn more about this topic by Rittik Chakrabarti, Ian Coffman and Michael Chiu, as seen on

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