nuam collaboration 

For years, when people talked about funding for startups, the conversation focused almost exclusively on capital. Raising equity was, in practice, the primary mechanism for financing growth, especially in the early stages. 

However, the ecosystem has evolved. As companies mature, generate recurring revenue, and achieve greater financial sophistication, their financing options also begin to expand. 

Today, many growing companies are no longer just grappling with the question of how to access capital, but also with which financing structure is most efficient for each stage of development. 

Equity financing remains essential for companies that prioritize rapid expansion, technological development, or early market penetration. In addition to capital, it typically provides networks, expertise, and strategic guidance. 

At the same time, debt has begun to gain ground as an increasingly important tool in modern corporate finance. Unlike equity, it provides access to capital without diluting ownership, which can be attractive to companies with more established business models, predictable cash flows, or specific financing needs. 

In developed markets, instruments such as venture debt, private debt, corporate bonds, and commercial paper are a common part of the financial cycle for growing companies. Even technology and high-growth companies combine different sources of financing, depending on their objectives, stage of development, and cost of capital. 

In Latin America, this trend is still emerging, but the market has begun to show clear signs of greater sophistication. The growth of private debt funds, specialized vehicles, and new mechanisms for accessing financing reflects a growing demand for more flexible and diversified structures. 

This phenomenon is also part of a broader shift: emerging companies are no longer necessarily early-stage startups. Many are companies with years of operation, significant sales, and specific financing needs for working capital, expansion, refinancing, or new projects. 

In this context, debt is no longer viewed merely as a traditional option and is beginning to establish itself as a strategic tool in the financial development of growth companies. 

Rather than replacing equity, both mechanisms appear to be moving toward a complementary model, in which the combination of equity and debt makes it possible to create financing structures that are more efficient, flexible, and tailored to each company’s specific circumstances. 

Because in more developed financial ecosystems, business growth rarely depends on a single source of financing.

Jaime Herrera
Business Development Manager at nuam