NXT Capital Venture Finance has put together a $500 million fund that will provide venture loans to emerging growth companies.
NXT targets companies in the technology and life science fields. It offers loans ranging from $1 million to $20 million to both seed and late stage businesses. This current fund establishes a capital base that NXT can use to make investments over the next couple years.
Group Head Jan Haas said venture debt offers a flexible, friendly alternative to equity investments. With a shrinking venture capital market and a longer lifecycle surrounding exits, loans can offer companies the support they need to become cash-flow positive or go public with less compromise.
“An uncertain IPO window, longer exits and other pressures are increasing demand for alternative sources of capital,” he said in a statement. “This significant additional funding will allow NXT Venture Finance to provide less-dilutive, more flexible funds to help emerging growth companies succeed.”
NXT Capital Venture Finance has offices in Boston and Silicon Valley. It is the venture arm of NXT Capital, which is based in Chicago and has offices around the US. NXT was founded in 2006 and has invested $3.2 billion across 142 transactions to date.