My Queue

There are no Videos in your queue.

Click on the Add to next to any video to save to your queue.

There are no Articles in your queue.

Click on the Add to next to any article to save to your queue.

There are no Podcasts in your queue.

Click on the Add to next to any podcast episode to save to your queue.

You're not following any authors.

Click the Follow button on any author page to keep up with the latest content from your favorite authors.

Loan Ranger

One VC firm is lending a helping hand to fledgling companies.
Magazine Contributor
2 min read

This story appears in the April 2007 issue of Entrepreneur. Subscribe »

Early stage investing recently took a new turn when Charles River Ventures announced it would be issuing bridge loans for seed-stage and startup companies. Entrepreneurs can now apply to CRV for unsecured small business loans of up to $250,000.

Although CRV is one of the oldest early stage venture funds in the country, rolling out a loan program for seed-stage companies breaks with several traditions: Seed-stage investing has long been the realm of angel investors, and loans the dominion of banks. Mixing the two within a venture fund breaks new ground.

The move is a response to a growing need in the market, according to George Zachary, general partner for CRV in Menlo Park, California. The loans are meant for internet-based companies that need just enough capital to rent space on servers, write some software and host a website. "There's more capital available, and [today's] companies need less money to get to market," he says.

Zachary cites the success of a CRV-funded internet browser company called as a prime example. "[It] has grown from zero to 10 million monthly users on average," he says. "With just seven employees, [it has] already had 72 million downloads and [is] already profitable. [It] was started for less than $200,000."

"We realized that more companies die from indigestion than from lack of food," says Zachary, referring to dotcoms taking large chunks of capital, then choking on the execution of their business plan. "We see a high correlation between entrepreneurs that are scrappy and [ones that are] successful."

CRV's bridge loans accrue interest at 6 percent but are not repaid until the company holds a larger round of equity fundraising or is sold.

More from Entrepreneur

Terry's digital marketing expertise can help you with campaign planning, execution and optimization and best practices for content marketing.
In as little as seven months, the Entrepreneur Authors program will turn your ideas and expertise into a professionally presented book.
Create your business plan in half the time with twice the impact using Entrepreneur's BIZ PLANNING PLUS powered by LivePlan. Try risk free for 60 days.

Latest on Entrepreneur