Working Capital Lines of Credit for Technology Companies

Marta Czekaj () and Bailey Morrow ()
Additional contact information
Marta Czekaj: Silicon Valley Bank
Bailey Morrow: Silicon Valley Bank

Chapter Kapitel 16 in Praxishandbuch Finanzierung von Innovationen, 2021, pp 279-290 from Springer

Abstract: Abstract As businesses mature, their daily flow of funds become more stable and predictable. Where they would have previously used equity or venture debt to extend cash runway, working capital facilities help companies optimize short term capital needs. A line of credit is effectively a financing solution that can be readily tapped at the borrowers’ discretion providing flexible and revolving low-cost capital as a cushion to cover regular business operations, bridge gaps in cash flow or boost revenue. In practice, the outstanding balance is limited to the sum of a borrowing base which fluctuates according to the amount of eligible collateral, subscription revenue or cash flow. Company’s business needs, its working capital profile, as well as its spending strategy will determine which type of credit line will be the most suitable.

Date: 2021
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-658-33116-0_16

Ordering information: This item can be ordered from
http://www.springer.com/9783658331160

DOI: 10.1007/978-3-658-33116-0_16

Access Statistics for this chapter

More chapters in Springer Books from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().