Invest With Debt

How Debt Investing Can Be a Great Alternative to Traditional Cash-for-Equity Investments

Invest with Debt in Companies

Investing with debt is a powerful strategy for both investors and companies in need of capital. At Kjøller, we specialise in debt investments and facilitating debt raises to support the growth of our portfolio companies. This approach provides an excellent alternative to traditional cash-for-equity investments, offering significant benefits to both investors and founders.

Why Invest with Debt?

One of the main reasons we like to structure deals around debt is the certainty it provides. Unlike equity investments, which depend on the company's performance and market conditions, debt investments come with a predefined repayment schedule. This means we know exactly when we will get our investment back, not if. This level of predictability is crucial for managing our portfolio's financial health, allowing us to plan more effectively and allocate resources with confidence. By reducing the uncertainty inherent in other types of investments, debt enables us to maintain a stable and reliable cash flow, which is essential for long-term strategic planning and growth.

Ensuring a Clear Business Case

We only use debt investments when there’s a clear and solid business case, ensuring the company can generate enough cash flow to repay the debt on schedule. We carefully assess the company's financial health and future earnings to make sure it can handle the debt. This way, we reduce the risk for everyone involved and increase the chances of good returns. By focusing on businesses with strong cash flow, we make sure our investments are secure and beneficial for both our investors and the companies we support. This straightforward approach helps us achieve steady growth and mutual success.

Advantages for Founders

For founders, investing with debt offers significant advantages. It can be used alongside equity or as a standalone option, resulting in less equity dilution. This is especially helpful for companies with a low valuation but high capital needs, as it allows them to raise the necessary funds without giving up a large portion of ownership. By using debt, founders can secure the capital they need while retaining more control over their business.

Securing Investments

We typically secure our debt against hard assets as collateral, giving us an added layer of security for our investments. This means that if the company encounters financial difficulties, we have tangible assets to fall back on, reducing the risk and ensuring greater protection for our investment.

Fueling Growth with Proven Models

Many of our portfolio companies opt for debt to further fuel their growth once they have established a proven business model. Debt can be a crucial tool for scaling operations and expanding market presence. By leveraging debt, these companies can access the capital they need to accelerate their growth without diluting their ownership, allowing them to seize new opportunities and drive their business forward.

Join Our Investor List

If you're an investor interested in investing with debt, we recommend signing up for our investor list. By joining, you'll gain access to our portfolio companies that are currently raising debt capital at attractive interest rates. This is a great opportunity to invest in promising businesses while earning competitive returns.

Are You Looking for Debt Financing for Your Startup?

If you're a startup looking to raise debt financing, feel free to reach out via our general application form. We typically respond within 24 hours. Apply for investment here.