Welcome to The Interchange! If you received this in your inbox, thank you for signing up and your vote of confidence. If you’re reading this as a post on our site, sign up here so you can receive it directly in the future. Every week, I’ll take a look at the hottest fintech news of the previous week. This will include everything from funding rounds to trends to an analysis of a particular space to hot takes on a particular company or phenomenon. There’s a lot of fintech news out there and it’s my job to stay on top of it — and make sense of it — so you can stay in the know. — Mary Ann

More debt financings means flat is the new up

Last week, I wrote about Founderpath, an Austin-based company that offers debt financing to B2B startups.

As I started thinking about debt and credit facilities as increasingly attractive alternatives for startups who are seeking capital — especially during a downturn such as the one we are currently experiencing — I realized that the number of companies that were securing debt capital or credit facilities appeared to be on the rise. This could be for any number of reasons. Some founders might be struggling to raise venture dollars, while others don’t want to — preferring not to dilute ownership.

On August 8, Mexico City–based expense management startup Clara announced it had been approved for financing from Goldman Sachs for up to $150 million. The facility, it said, would allow Clara to continue to grow its corporate card, accounts payables and short-term financing offerings for businesses in LatAm. The company says it’s currently working with over 5,000 businesses across Mexico, Brazil and Colombia with ambitions to double that number by year’s end. Notably, Clara was believed to be valued at about $130 million at the time of a $30 million raise in May of 2021. Just eight months later, it had raised a Coatue-led $70 million Series B and achieved unicorn status.

Here in the U.S., Yieldstreet announced on August 11 that it had secured a $400 million warehouse facility from Monroe Capital LLC. A spokesperson from the alternative investment startup told me that the financing is the largest of its kind to date for Yieldstreet. In June of 2021, I covered Yieldstreet’s $100 million Series C at "near unicorn" status. In announcing its latest financing, the company said it has had more than 400,000 users since its 2015 inception and more than $3 billion in funding across an ever-evolving suite of investment products. The spokesperson also told me: “This isn't normal corporate debt — it uses a warehouse facility, which means it is targeted to support the creation of new funds and products for Yieldstreet's platform — growing the number of available investments for users, rather than general ops or expenses.”