Bridge Financing

Bridge financing definition

Bridge financing is a type of financing (source of capital) which is given for a specified and limited time period (temporary is the key word here), until the company that receives it secures a more permanent and stable form of financing. Therefore bridge financing acts as a “bridge” between now and the more stable future.

Bridge financing in private equity

Bridge financing is a relatively huge area of the venture capital and private equity business. Companies receive bridge financing while being in preparation for the next stage of financing, often an initial public offering (IPO) or a private placement.

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