Bridge financing
Short-term financing intended to bridge a funding gap until a later financing, sale or other repayment source. That expected source may be delayed or fail.
Bridge financing in round numbers
Hypothetical: a company borrows US$2m under a six-month bridge loan while seeking a recapitalization. The loan matures in six months; the recapitalization is an expected repayment source, not a guaranteed event.
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| Term | Assumption |
|---|---|
| Principal | US$2m |
| Contractual tenor | Six months |
| Expected repayment source | Proposed recapitalization; completion uncertain |
Terms Related to Bridge financing
IPO · Rounds of financing · Convertible debt · Down round · All of the glossary