Introduction – Startup Funding Basics Since the beginning of the COVID-19 pandemic, startup activity has skyrocketed within the United States. [1] In 2025 alone, over 5.1 million entrepreneurs took the leap from business idea to formation. [2] Yet, despite this trend, only roughly 70% of new businesses survive beyond two years of formation and only 50% of businesses survive beyond five years. [3]  Even those startups that are “VC-backed,” often indicating perceived high gro

After the COVID-19 pandemic, climbing interest rates, heightened risk aversion among institutional investors, and depressed corporate valuations have caused startups to rethink their financing strategies and pursue sources of capital beyond traditional venture capital (“VC”). [1] Today, VC, a historically prominent source of financing for startups, is increasingly being supplemented with venture debt (“VD”). [2] VD is a financing tool that allows founders to raise capital t

Venture capital ("VC") represents a crucial source of funding for entrepreneurs gearing up for their company's next phase of growth....