Definition
Bridge capital
Bridge capital is temporary funding that helps a business cover its costs until it can get permanent capital from equity investors or debt lenders.
The repayment terms for bridge capital vary, but usually payment is made in full when the company receives the new capital or a longer-term loan.
More about bridge capital
The most common use of this type of funding is to bridge the purchase of a property while the company waits for the sale of another to close.
Another example would be when a company is doing a round of equity financing but takes out a bridge loan to finance working capital until the money from the sale of shares comes through.