Peers & Company · San Francisco Merchant Bank

Mezzanine Financing

Hybrid capital between senior debt and equity — structured for your growth stage.

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Definition

What Is Mezzanine Financing?

Mezzanine financing is a hybrid form of capital that sits between senior debt and equity in a company's capital structure. It typically combines a debt component with an equity kicker (warrants or conversion rights), offering higher flexibility than senior loans in exchange for a higher return to the lender. For growth-stage companies, mezzanine capital is often used to fund acquisitions, expansion, or working capital without the full dilution of an equity round.

How It Works

At Peers & Company

Peers & Company structures mezzanine financing as part of broader capital raises — often combining senior debt, mezzanine tranches, and equity to optimize the capital structure for each client. We access our global network of family offices, private equity, and institutional lenders to source the right mezzanine capital for your situation.

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Key Advantages

Why Founders Choose Mezzanine Financing

Less Dilutive Than Equity

Mezzanine typically dilutes less than a full equity round while providing similar flexibility.

Larger Ticket Sizes

Access larger capital amounts than senior debt alone allows.

Acquisition Financing

Ideal for funding strategic acquisitions where senior debt falls short.

Flexible Structure

Terms can be tailored to your cash flow profile and growth timeline.

Global Network

Access to specialized mezzanine lenders through our 20+ year network.

Optimized Capital Stack

We structure the full capital stack to minimize dilution and cost of capital.

Who Qualifies

Is This Right for Your Company?

Companies with $4M–$100M in annual revenue seeking $3M–$30M+ for acquisitions, expansion, or recapitalization. Both profitable and growth-stage companies qualify depending on the structure.

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Industries We Serve

Professional ServicesLogistics Supply ChainFood BeverageEcommerce

FAQ

Common Questions

What is mezzanine financing?
Mezzanine financing is hybrid capital that sits between senior debt and equity in a company's capital structure. It combines debt with an equity component (warrants or conversion rights) and is typically used for acquisitions, expansion, or recapitalization.
Can you give a mezzanine financing example?
A $30M-revenue company needs $8M to acquire a competitor. We structure $5M in senior debt plus $3M in mezzanine financing with a small warrant kicker. The founder completes the acquisition while retaining over 95% ownership — far less dilutive than a full equity round.
When is mezzanine financing the right choice?
Mezzanine is typically the right choice when senior debt capacity is exhausted but a full equity round would be too dilutive. It's commonly used for acquisition financing, management buyouts, and growth capital where the company needs more than senior debt can provide.
How does mezzanine financing differ from revenue-based financing?
Revenue-based financing is fully non-dilutive with no equity component. Mezzanine financing typically includes a small equity kicker (warrants) in exchange for greater flexibility and larger ticket sizes. The right choice depends on your capital needs and dilution tolerance.

The information on this page is for general informational purposes only and does not constitute financial, investment, legal, or tax advice. All financing is subject to underwriting approval and eligibility criteria. Past performance is not indicative of future results. Peers & Company is a merchant bank, not a registered investment advisor. Consult qualified financial and legal advisors before making financing decisions.