Mezzanine Financing

What is it?

Mezzanine Financing is risk tolerant financing that is customized to your business opportunity and priced to balance risk and reward.  Our first six deals have ranged from $50,000 to $500,000 and have been priced to between 9% and 35%, based on their level of risk.

What is the typical structure?

VfG provides risk-adjusted capital in a structure that avoids straight equity where a sale of the business is required to "cash out" the investor.

The typical structure includes either subordinated debt or royalty financing because they do not require the future sale of the business in order to tap into the "reward" for taking the higher risk. Deals with substantial risk, may also include warrants (the right to purchase stock at a predetermined price), but the warrants are not structured to be the "bread and butter" of the return.

For more information on these deal structures and their larger context, see Growth Financing Overview.

What do you mean by risk? Do you have examples?

VfG offers financing to companies across the spectrum of risk, from those that are just beyond being bankable to those that are appropriate for venture capital. Here is a description of some VfG deals along the spectrum of risk.

Representative portfolio deals by risk
How Vested for Growth is different from banks and venture capital
Business financing by risk

For more information, contact John Hamilton, at 224-6669 ext. 239 or by email at jhamilton@vestedforgrowth.com.