Accessing high-growth companies via venture debt. Plus: private capital’s a gamechanger for emerging sports
Welcome to the weekly round-up of highlights from our free daily Preqin First Close newsletter, your essential guide to the global alternatives industry. I’m Jayda Etienne, Deputy Editor, and every Friday I select exclusive news and insights from the past week.
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Lets kick things off with some trivia – Global popstar Usher is currently in the middle of a 10-night residency at London's O2 Arena, as part of his ‘Past Present Future’ tour which celebrates his 30-year career. The O2 boasts a capacity of over 20,000 people, but what is the largest indoor concert venue in the world?
a) Philippine Arena
b) Paris La Defense Arena
c) Wembly Arena
d) Saitama Super Arena
Find the answer at the end of the newsletter.
An ‘abundance of companies’ could boost $20bn-AUM venture debt market
Are investors in danger of missing the next generation of tech powerhouses?
A total of 83,300 companies worldwide have received VC funding since 2020, when the venture market surged during and after the pandemic.
That population likely includes some future trillion-dollar behemoths. But with global financial markets in disarray and growth ventures resistant to raising capital at lower valuations, equity investment is a tricky proposition. Preqin recorded 23,455 VC deals in 2024, down 41% from the peak of 39,553 deals in 2021.
Venture debt offers a different method for investors to access these growth companies.
It's a relatively small private credit niche, which had only $20bn AUM as of June 2024, including $5.6bn of dry powder. Preqin tracks 441 fund managers active in the strategy (out of a total 3,139 active private debt GPs).
BlackRock Growth Debt (Preqin is a part of BlackRock) says that, as a specialist category with limited competition, venture and growth debt can enhance risk-adjusted returns in private credit portfolios.
Managing Director Mårten Vading says that some investors unfamiliar with the strategy can mistakenly view the risks as similar to venture and growth equity, but they’re not.
‘Compared to equity, growth and venture debt come with a host of features that offer more predictability of return. They have a predetermined repayment schedule, clear security, amortization, and priority in the capital structure.’
For those managers qualified and equipped to lend, there’s ‘an abundance of companies actively seeking venture debt,’ according to Ross Ahlgren , Managing Director, BlackRock Growth Debt, who adds: ‘I see this as a major moment for the growth and venture debt space.’
By Grant Murgatroyd , Head of News
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The VCs cheering for pickleball, padel, snowboarding, and digital golf
The $6.1bn deal to buy NBA basketball champions, the Boston Celtics, is set to be the largest in US sports history. A group led by businessman Bill Chisholm and private equity firm Sixth Street agreed the deal in March.
But some investors are looking beyond the traditional.
‘Asset managers are forecast to direct increasing capital toward emerging sports that are digitally native and poised for rapid growth,’ according to Deloitte’s 2025 Sports Outlook published last month.
Pickleball, bull riding, and drone racing are among the niche activities with growing fanbases that have been transformed by private capital. There are opportunities as pro sports shift toward shorter, entertainment-driven, and streaming formats.
Last month, New York-based Left Lane Capital led a $10mn seed round to expand the Pro Padel League. Earlier this year, it also led a $15mn investment in the Snow League, a snowboarding and freeskiing competition that’s just debuted in Colorado.
Boston-based Will Ventures , which participated in the latter round, explained the context: ‘Investors started wondering: what if – instead of investing in today’s largest sports leagues – we built a new one?’
Get the full story by Rupert Gilbey , Content Editor
Alina Garcia , Associate, BlackRock, and Libby Fennessy , Production Editor, Preqin First Close, take another look at the ‘$77bn profit pool’ that is biopharma supply-chain services. With significant patent cliffs on the horizon, biotech deals are expected to maintain momentum, so the industry has a big order to fulfill.
Large infrastructure funds are raising impressive amounts, bolstered by growing demand for decarbonization and clean energy solutions. But competition is heating up. In a Preqin First Close Q&A Pablo Pallas , Managing Partner at White Summit Capital, highlights opportunities in mid-market infrastructure – and how to capitalize on tailwinds.
a) Philippine Arena
With a maximum seating capacity of 55,000, the Philippine Arena it is the world's largest indoor arena. It was officially recognized by The Guinness World Records in 2014. Recent international performers include Coldplay, Olivia Rodrigo, Dua Lipa, and Harry Styles.
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