Market Insights Financial Capital Raising Traditional Capital Raising

Venture Debt - Croatia

Croatia

The total capital raised in the Venture Debt market market in Croatia is projected to reach US$5.14m in 2024.
Traditional Venture Debt dominates the market with a projected market volume of US$5.14m in 2024.
In global comparison, most capital raised will be generated the United States (US$22,410.0m in 2024).
In Croatia, the Venture Debt market is gaining traction among startups seeking alternative financing options to fuel their growth.

Key regions: Brazil, Germany, United Kingdom, Singapore, China

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Analyst Opinion

The Venture Debt market in Croatia has been experiencing significant growth and development in recent years.

Customer preferences: Entrepreneurs and startups in Croatia are increasingly turning to venture debt as a financing option. This is driven by several factors. Firstly, venture debt provides a non-dilutive form of financing, allowing entrepreneurs to retain ownership and control of their companies. Secondly, venture debt offers flexibility in terms of repayment, with interest-only periods and longer repayment terms compared to traditional bank loans. Lastly, venture debt is often seen as a complementary source of funding to equity financing, allowing startups to extend their runway and achieve key milestones before raising additional equity.

Trends in the market: One of the key trends in the Venture Debt market in Croatia is the emergence of specialized venture debt providers. These firms focus exclusively on providing debt financing to startups and have a deep understanding of the unique needs and challenges faced by these companies. This specialization allows them to offer tailored financing solutions that are better suited to the growth trajectory and cash flow dynamics of startups. As a result, entrepreneurs are increasingly turning to these specialized venture debt providers for their financing needs. Another trend in the market is the increasing availability of venture debt for early-stage startups. Traditionally, venture debt has been more commonly used by later-stage companies with a proven track record and steady cash flow. However, there is a growing recognition that early-stage startups can also benefit from venture debt, particularly as the ecosystem matures and investors become more comfortable with the risk-return profile of these investments. This has led to an increase in the number of venture debt providers willing to work with early-stage startups and provide them with the necessary financing to fuel their growth.

Local special circumstances: Croatia has a vibrant startup ecosystem, with a growing number of innovative companies across various sectors. This has created a favorable environment for the development of the Venture Debt market. The government has also taken steps to support the growth of startups through various initiatives and programs, further fueling the demand for venture debt financing. Additionally, the presence of a strong network of angel investors and venture capital firms in Croatia has provided startups with access to equity financing, making venture debt a natural complement to their funding mix.

Underlying macroeconomic factors: The favorable macroeconomic conditions in Croatia have also contributed to the growth of the Venture Debt market. The country has experienced steady economic growth in recent years, with low inflation and a stable currency. This has created a conducive environment for startups to thrive and attract investment. Furthermore, the low interest rate environment globally has made debt financing more attractive for both lenders and borrowers, further driving the demand for venture debt in Croatia. In conclusion, the Venture Debt market in Croatia is experiencing significant growth and development, driven by customer preferences for non-dilutive financing, the emergence of specialized venture debt providers, and the increasing availability of venture debt for early-stage startups. The local special circumstances, including a vibrant startup ecosystem and government support, further contribute to the growth of the market. The favorable macroeconomic conditions in Croatia also play a role in driving the demand for venture debt financing.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on the amount of capital raised, the average of deal size and the number of deals.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use data from OECD, annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, CPI, number of small and medium-sized enterprises (SME), new businesses registered (number) . This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.