Alternative exits for impact investments

Increasingly, entrepreneurs are experimenting with deal structures that provide returns to investors without a sale or IPO. These structures often incorporate variable payments to investors based on a measure of the company’s financial performance, such as gross revenue or EBITDA. You may have heard structures like these described as “revenue based financing,” “revenue share agreements,” “flexible debt,” or “variable payment obligations.” We have also seen structures that contemplate the repurchase of investor stock after an extended period of time.