Venture Funding in a COVID-19 World
The COVID-19 pandemic has created a constantly changing environment with impact on all aspects of our personal lives and businesses. Given the current conditions, our conversations with clients are evolving. A few weeks ago the primary focus was on structuring non-dilutive financing options for growth capital, working capital, CAPEX, etc. We’re still having those discussions, but more and more, we’re asked about the impact of the pandemic on current market conditions, advice on strategy and timing of securing capital, etc. As we are first and foremost an advisory service, our team will be sharing weekly updates on what we’re seeing and hearing in the marketplace, feedback from banks and funds, and thoughts and suggestions for possible strategies and next steps.
Our team has regular calls with funding partners and sources. While all indicate they are open for business, it is not, as they say, “business as usual.” The pace is different, with adjustments required as firms transition to teams working remotely and increased due-diligence focused on the current economic uncertainty. All are requesting current details as to how COVID-19 is impacting YTD and forecast revenue and expenses. On a positive note, venture funds continue to have record breaking amounts of cash that must be deployed for LPs to make a return on investment.
While this is an unprecedented and terrible event, capital remains available in the marketplace, although with some tightening of credit windows and process inefficiencies.
We’ll be sending these updates weekly. Should you have any questions or want an update sooner, feel free to reach out to the Blue Willow Group Team.