Tech Workers Borrowing Against Startup Shares as IPO Delays Grow
Silicon Valley employees are increasingly turning to private credit platforms like Techdollar to borrow against their startup equity, rather than selling shares. CEO Terence McMenamin explains that the growing delay in startups going public—now averaging around 11 years instead of five or six—has created a liquidity problem for workers who hold large amounts of illiquid stock options and shares. Techdollar offers lines of credit secured by vested private equity, allowing employees to access cash without giving up future upside. This is particularly valuable in high-growth sectors like AI and robotics where long-term gains could be significant if the company eventually goes public or achieves a major exit. Traditional lenders have been hesitant due to valuation uncertainty and legal complexities around private shares. The platform aims to address these challenges by building better underwriting models, offering an alternative to costly tender offers or secondary market sales.
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Topics: liquidity solutions private credit Silicon Valley compensation startup equity