I work with a firm that does coding, cybersecurity, and various tech-heavy professional services for pre-seed companies and, to keep the cap tables clean, they issue venture debt for services rendered, leaving the start-ups to use their cash on advertising, strategy, and such. Very often the firm has board seats so they can right the ship if the direction gets too far off course and jump in with some strategic advisory, introduce clients, and overall give it the old college try before things might capsize.

This venture debt is in place with a double-digit number of firms that are humming along from firms with good runway, and reliable payment history, albeit most of the book is less than a year or two old. Would you take bank financing to this and treat this as a consulting business or how would you attack the financing on this?