KKR Has Considered Buying Venture Lender to Expand Startup Debt

Private equity giant Kohlberg Kravis Roberts & Co. is looking to expand its lending to venture-backed startups and has considered buying a venture-focused lender or recruiting a team of professionals focused on such deals, people familiar with the talks told The Information.

Some KKR rivals, including Blackstone, have been making a similar push into venture debt, anticipating that tech startups will need to borrow more as venture capital funding falls and the window for initial public offerings remains shut. Part of the pitch for startups is that debt won’t reduce founders’ ownership stakes as much as issuing additional equity. The loans may also allow startups to avoid raising funds at a sharply lower valuation.