Unlike traditional commercial banks, venture banks typically provide debt to start-ups that have already received equity financing from professional venture capital firms. In return for providing additional debt financing, these venture banks receive in return all of the following except?

Question

Quizplus · Accepted Answer

Venture banks typically receive interest payments, repayment of principal, implementation of loan restrictions, and sometimes the right to buy equity at a specific price. They do not receive tax breaks on the interest as part of their compensation.

Unlike Traditional Commercial Banks, Venture Banks Typically Provide Debt to Start-Ups