Across Latin America and the Caribbean, many innovative companies generate revenue, attract investors, and demonstrate strong growth potential, yet still struggle to secure the financing needed to scale their businesses. This challenge is particularly acute for companies developing innovative business models, such as expanding access to financial services and healthcare, or helping other firms become more productive and competitive.

Despite their potential, these companies are often considered too risky by conventional lenders. Many are relatively young, have limited tangible assets, or operate business models that fall outside traditional credit assessment frameworks. As a result, these firms may be unable to access financing even when they have successfully moved beyond the proof-of-concept stage and are experiencing rapid growth.

Traditional lending models tend to rely on established cash flows, lengthy operating histories, and physical collateral. Innovative companies, by contrast, often create value through intangible assets such as technology, data, intellectual property, talent, and distribution networks, strengths that are not always recognized or adequately valued by conventional financing mechanisms.

Structured and Venture Debt Closes an Important Financing Gap for Innovative Businesses

This is when structured and venture debt comes in.  Structured debt is a customized lending solution designed to fit a company’s specific business model, cash flow profile, asset characteristics and financing needs. Typically targeting companies that have early operating businesses and repayment capacity but whose financing needs, risk profile, or asset structure do not yet fit traditional commercial bank lending.    

Venture debt is a financing tool designed to complement equity investment for high-growth companies, particularly those already backed by venture capital investors. It provides additional funding for working capital, capital investments and on-lending financing while minimizing ownership dilution, although some structures include equity-linked features.

By complementing equity, structured and venture debt can help companies accelerate growth, support expansion and reach business milestones while allowing founders to retain a larger ownership stake than they would through additional equity financing alone. These are flexible instruments for companies that have strong growth prospects but limited collateral or profitability.

IDB Lab as a Bridge to Scale

As the innovation and venture arm of the IDB Group, IDB Lab helps address the financing gap between venture capital and traditional banking. Through structured and venture debt it supports innovative companies with proven commercial traction that are addressing development challenges and positioned to expand their impact.

Our structured and venture debt financing helps conventional lenders understand the market potential of these companies and help demonstrate their viability. As companies build repayment track records with our support, other lenders may gain the confidence to participate, broadening access to capital across the region.

Financing Innovation Across KeySectors

IDB Lab’s broader debt portfolio illustrates how financing can support access to financial services and healthcare, as well as drive productivity among small and medium-sized businesses. The following examples span venture and structured debt operations:

Prester, Paraguay. Prester uses digital credit assessment and alternative data to help financially excluded people access credit and begin building a credit history.

Aviva, Mexico. Aviva combines physical kiosks with AI and digital technology to serve people underserved by traditional banks. IDB Lab’s venture debt financing supports the company's efforts to expand its loan portfolio and reach additional underserved communities.

Salud Fácil, Mexico. Salud Fácil provides leasing solutions that help small and medium-sized clinics acquire critical diagnostic and treatment equipment, strengthening their capacity to serve patients.

Pascargo, Guyana. Pascargo provides logistics and last-mile delivery services that help small and medium-sized businesses manage inventory, reduce transaction costs, and improve deliveries.

While these companies operate in different sectors and markets, they share a common objective: using innovation to solve challenges that affect people and businesses across the region.  IDB Lab’s debt financing helps unlock that potential by supporting sustainable growth and expansion.  

Beyond financing, IDB Lab also works with portfolio companies to strengthen impact measurement and management practices and enhance environmental, social, and governance (ESG) performance. These efforts help companies better understand their development impact while building stronger foundations for long-term growth.

From Individual Transactions to Stronger Markets

The impact of structured and venture debt extends beyond individual transactions. By combining financing, expertise in assessing innovative business models, and a development mandate, IDB Lab can help companies move from early commercial traction toward sustainable growth. Over time, these investments can contribute to a broader and more diverse financing ecosystem, encouraging greater participation by private lenders and expanding the range of financing options available to entrepreneurs.

For innovative companies solving real development challenges, access to the right financing at the right time can make the difference between remaining a promising idea and reaching millions of people.

As more entrepreneurs build solutions for Latin America and the Caribbean's most pressing challenges, financing tools such as venture debt can play an important role in helping those solutions scale.

Learn more and apply.