Venture Debt - Kazakhstan | Statista Market Forecast

In Kazakhstan, the Total Capital Raised in the Venture Debt market market is expected to reach US$826.50k by 2024.
Traditional Venture Debt is the dominant player in the market, with a projected market volume of US$826.50k in 2024.
When compared globally, the United States leads in Capital Raised, with US$22.4bn expected in 2024.
Kazakhstan's Venture Debt market is gaining traction among startups seeking alternative capital raising options in the evolving financial landscape.

Definition:

The Venture Debt market refers to a form of equity and debt financing combination, which is used to finance early stage and growth stage capital-backed companies. Besides equity funding rounds, business can seek venture debt that minimizes ownership dilution and governance requirements to increase the cash runway to reach the next milestone or even provide a cushion for delays.

Structure:

The market consists of two segments:
- The Traditional Venture Debt market refers to a form of debt financing that is often provided to venture-backed companies to either buy new equipment, meet a deficiency of short-term capital, or support expansion plans.
- The Growth Venture Debt market refers to a form of debt financing that is often structured with warrants or options, which provides a rapid development stage in which businesses can support their long-term oriented growth plans.
The market data comprises of the amount of capital raised, number of deals, and average deal size.

Key players in this market are companies such as Wells Fargo and Hercules Capital.

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Venture Capital
Venture Debt funds are sponsors by governments

The Venture Debt market in Kazakhstan has been experiencing significant growth in recent years.

Customer preferences: Kazakhstan, being an emerging market, has seen a surge in entrepreneurial activity and startup culture. Startups in various sectors, including technology, e-commerce, and fintech, are increasingly seeking alternative financing options to fuel their growth. This has led to a growing demand for venture debt as a viable financing solution.

Trends in the market: One of the key trends in the Venture Debt market in Kazakhstan is the increasing availability of venture debt financing options. Traditional banks and financial institutions have started to recognize the potential of startups and are offering specialized venture debt products. This has created a competitive landscape, providing startups with more options and favorable terms. Another trend is the rise of local venture debt funds and platforms. These funds are specifically focused on providing debt financing to startups and have a deep understanding of the local market dynamics. They offer customized solutions tailored to the specific needs of startups in Kazakhstan, which has further fueled the growth of the Venture Debt market.

Local special circumstances: Kazakhstan has a rapidly growing startup ecosystem, with government initiatives and support programs in place to foster innovation and entrepreneurship. The government has recognized the importance of startups in driving economic growth and has implemented policies to attract foreign investment and support local startups. This favorable environment has created a conducive ecosystem for the development of the Venture Debt market.

Underlying macroeconomic factors: The Venture Debt market in Kazakhstan is also influenced by macroeconomic factors. The country has been experiencing steady economic growth, with a focus on diversifying the economy beyond its traditional sectors. This has led to increased investments in technology and innovation, creating opportunities for startups and driving the demand for venture debt financing. Furthermore, the low interest rate environment globally has also played a role in the growth of the Venture Debt market in Kazakhstan. With interest rates at historic lows, startups are able to access debt financing at favorable terms, making it an attractive option compared to equity financing. In conclusion, the Venture Debt market in Kazakhstan is experiencing growth due to the increasing demand for alternative financing options by startups, the availability of specialized venture debt products, the rise of local venture debt funds, and the favorable macroeconomic environment. As the startup ecosystem continues to flourish and the government's support for entrepreneurship remains strong, the Venture Debt market is expected to further expand in the coming years.

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.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

Venture capital is the term used to call the financial resources provided by investors to startup firms and small businesses that show potential for long-term growth. It has become a very important source of capital for entrepreneurs, who often have problems with financing their needs through risk-averse banks. Venture capital investments incorporate a high level of risk as only some of the VC-backed companies develop into successful and highly profitable businesses. In 2020, the leading venture capital backed company worldwide was the Manbang Group, which based in Nanjing, China.