Heddleston: Venture debt extends runway but lender rights create hidden risks
Russ Heddleston · EP 581: DocSend $11M Raised, 2800+ Company Customers, 10,000+ Seats Because Links > Attachments For Docs with CEO Russ Heddleston · Feb 25, 2017 · at 14:16
DocSend CEO Russ Heddleston reflects on taking on $1 million in venture debt post-seed and cautions founders about the trade-offs.
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“The ratio of venture debt to money in the bank that you have, it's really a insurance policy and it extends your runway a little bit, but it can really come back to bite you. Depending on like a few different scenarios, how it ends and things like that. Well, obviously those sorts of things, but even if you get like a pretty good term sheet, just the way venture debt is structured it will extend your runway some in some scenarios, but it's also kind of scary in terms of just the rights they have over you.”
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