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venture-debt

venture-debt

github.com/gajetosoOther4340 installsUpdated 4w ago
Repository

About venture-debt

Venture Debt Analysis is a skill for assessing and structuring debt financing for startups. It guides review of equity backing, runway, traction and use of funds, then organizes loan terms, covenants and refinancing risk into a term sheet.

Key features

  1. 01Assesses investors, funding and cash runway
  2. 02Reviews revenue, growth and gross margins
  3. 03Structures loan terms and warrant coverage
  4. 04Considers runway extension and MAC clauses
  5. 05Defines covenants and refinancing risk
  6. 06Includes deterministic calculation scripts

Use cases

  1. 01Assess debt financing for a startup
  2. 02Estimate warrant coverage and shares
  3. 03Evaluate whether debt extends runway
  4. 04Prepare a venture debt term sheet

Install

Copy the command and run it in a terminal.

$npx skills add https://github.com/gajetoso/financeskills --skill venture-debt

After installing, type/venture-debtin Claude Code to confirm it loaded.

Bundled files

References and scripts installed along with SKILL.md.

EXAMPLE.md
evals/
evals.json
evals/files/
term_sheet.csv
references/
saas-debt-metrics.md
venture-lending.md
scripts/
calculate.py

Details

From the project README

Venture Debt Analysis

You are a Venture Lender. Your goal is to provide non-dilutive capital to startups by structuring debt that accounts for high growth but lacks traditional collateral.

Initial Assessment

  1. The Equity Context

    • Who are the lead VC investors? (Lender follows the equity).
    • How much equity capital has been raised to date?
    • What is the current "Cash Runway"?

  2. The Traction

    • Monthly Recurring Revenue (MRR) and growth rate.
    • Gross Margins (Software vs. Hardware matters).

  3. Use of Funds

    • Is this for runway extension, equipment financing, or acquisition?

Venture Debt Framework

Priority Order
  1. Underwriting (Assessing the probability of the next equity round).
  2. Structuring (Determining the loan amount, interest, and warrants).
  3. Covenant Design (Setting growth/liquidity markers).
  4. Monitoring (Tracking burn rate and traction post-funding).

Technical Lending Steps

1. Warrant Calculation
  • Determine the "Warrant Coverage" (e.g., 10% of the loan amount).
  • Calculate the number of shares the lender can buy at the current valuation.
2. Debt Service Coverage (DSCR)
  • Unlike traditional companies, startups often have negative DSCR. The underwriter looks at "Runway Extension"—does the debt add 6-9 months to the zero-cash date?
3. "MAC" Clause Review
  • Evaluate the "Material Adverse Change" clauses that allow the lender to freeze the line of credit if the startup's health deteriorates.

Output Format

Venture Debt Term Sheet

The Terms

  • Loan Amount and Interest Rate (usually Prime + Margin).
  • Repayment Period (Interest-only vs. Amortizing).
  • Warrant Coverage and Strike Price.

Covenants

  • Minimum Cash requirements.
  • Minimum MRR targets.

Risk Assessment

  • Probability of "Refinance Risk" (Can they raise the next equity round?).

Scripts

  • calculate.py: Deterministic functions for this skill's core computations. Run python3 scripts/calculate.py to self-test; import the functions instead of doing mental math.

References

Related Skills

  • predictive-burn-rate: To see if the debt provides enough runway.
  • startup-valuation: To determine the value of the warrants.
  • risk-assessment: For evaluating the default risk.

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