Trifecta Capital lends $3 mn venture debt to Urban Ladder

Bangalore-based Urban Ladder Home Decor Solutions Pvt. Ltd that operates furniture portal Urban Ladder has secured $3 million (Rs 20 crore) in venture debt from Trifecta Capital.

Mint, which first reported the development citing a Registrar of Companies (ROC) filing by Urban Ladder, said the cash transaction that happened in June was in lieu of a mix of non-convertible debentures and compulsorily convertible preference shares

Non-convertible debentures are unsecured bonds that cannot be converted to the company's equity.

The fundraising reflects an emerging trend where startups are resorting to raising venture debt as a funding option to meet working capital requirements amid a slowdown in the fundraising ecosystem. Many startups prefer venture debt as the cost of capital is lesser compared with equity financing which also involves dilution of founders' stake. Venture debt is also seen as an alternative funding option for early-stage firms which do not have access to conventional bank financing.

Email queries sent to Urban Ladder co-founders Rajiv Srivatsa and Ashish Goel did not elicit a response at the time of filing this report.

Urban Ladder is one of the well-funded startups in the online furniture space and has raised close to $76 million to date, according to VCCEdge, the data research platform of VCCircle. Pepperfry, which is operated by TrendSutra Platform Services Pvt. Ltd, has so far raised $128 million and is the most funded player in the space.

The firms that have availed of venture debt include online B2B marketplace for industrial goods  Industrybuying.com, Hyderabad-based kidney care clinic chain NephroPlus, express surface logistics firm Rivigo,  messaging platform HelpChat and OneAssist Consumer Solutions Pvt. Ltd which provides protection for credit and payment cards and smartphones.

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