The venture debt landscape has continued to expand with more banks and non-bank lenders entering the space.

• Venture debt can provide support to extend a company's runway and expand its valuation — while minimizing dilution for shareholders.

Why it's important: Previously, when evaluating a venture debt term sheet, the rate and structure mattered most. But with the increased options available in the market, it's imperative to evaluate the quality of a potential lending partner.

• Experience is key. Companies need a lending partner that's worked across various industries from startup to exit and through different economic cycles.
• Remember: An experienced banker might not mean an experienced bank — and vice versa. It's important to look for both.

What you need to know: Bridge Bank and its bankers have been helping clients across industries grow through various stages for more than 20 years.

The strategy: Bridge Bank takes an entrepreneurial approach to financial solutions, working closely with clients to understand their successes and challenges and how to navigate each.

• Unlike most banks, Bridge Bank clients benefit from a single point of contact throughout their life cycle. This means clients know their banker, and their banker knows them and their business inside and out.

An example: Lovevery, an early childhood development company best known for its award-winning stage-based Play Kits subscription program, launched in 2017.

• In 2019, Bridge Bank closed a venture debt term loan for the growing startup that had just closed its Series B funding round.

The story: The company was transitioning from a strictly retail sales channel to a consumer subscription recurring revenue model. The venture debt term loan helped with sales and marketing spend as well as increased inventory expenses.

• A year later, with a rapidly expanding customer base, Bridge Bank was able to nearly quadruple Lovevery's credit facility and convert the term loan to a recurring revenue line of credit. This increased availability helped the company scale.
• The additional access to capital also proved critical in 2020 as subscriber growth skyrocketed, and COVID-related supply chain delays disrupted the delivery model. The line of credit allowed the business to hold more inventory and ultimately support customer growth.
• In late 2021, after closing its Series C, Bridge Bank doubled its commitment and modified the credit facility to help accommodate Lovevery's growing subscription base and support the brand's continued global expansion.

In other words: Bridge Bank has helped Lovevery scale through various life cycles, challenges and wins over the past five years.

• "Bridge Bank has helped us navigate the pandemic, different economic conditions and an expanding set of financial needs as we have grown the business," cofounder and CEO Jessica Rolph says. "They have worked hard to understand our business and be a supportive partner through periods of both stress and great success."

The results: Since closing the venture term loan in 2019, Lovevery has grown its revenue by 870% with Bridge Bank's support.

• When asked what keeps Lovevery working with Bridge Bank, cofounder and President Roderick Morris says: "The people at Bridge Bank, their understanding and belief in our business and the knowledge that we can count on them to work with us as teammates."

Another example: LinkSquares, founded in 2015, turned to Bridge Bank in 2020 to secure a debt facility after its Series A funding round.

• LinkSquares' AI-powered technology helps legal teams draft, review and execute agreements and manage legal projects all in one place.

The story: Luigi Testa joined LinkSquares in 2020 as CFO. Before securing the debt facility with Bridge Bank, his team surveyed more than a dozen banks, including the world's largest lenders, to determine the best fit.

Testa said they moved forward with Bridge Bank because:

• Bridge Bank's team understood LinkSquares' current and future business needs.
• The deal terms were competitive.
• The debt facility offered flexibility of not having to draw the line down in a high-interest environment, where non-bank lenders typically have that requirement.
• LinkSquares' diligence calls with Bridge Bank customers and investor groups were all positive.

The results: "Fast forward four years later, and everything Bridge communicated to us on how they would be great partners was true," Testa says.

• Bridge Bank has been able to upsize LinkSquares' debt facility since the company has grown annual recurring revenue 25x and completed rounds of equity funding totaling $161 million.

Here's what else: From day one, LinkSquares has worked with their same banker who has decades of experience working as an operator, primarily as a CFO, for both private and public tech companies.

• "It's very rare to find a banker that has this depth of experience in the operating world and having him as a partner who truly understands what the business is going through has made a world of difference," Testa says.

The takeaway: "Outside of good terms, working with great people who do what they say is equally as important," Testa says. "The team at Bridge Bank has always followed through on delivering great service above and beyond what they advertise in the courting phase."

Learn how Bridge Bank can help your technology company grow.