Foursquare has been able to raise a whopping $41 million, but the funding hasn’t come in the form you might expect.
The company announced the news today, saying the cash came from a host of well-known Silicon Valley investors, including Andreessen Horowitz, Union Square Ventures, and others. However, rather than give those firms equity, Foursquare raised the $41 million through a combination of tapping into the Silver Lake Waterman growth debt fund, as well as asking for convertible debt from the aforementioned investors, among others.
The cash raised helps Foursquare fund its growth and also aids the company in putting off justifying its valuation. For years now, Foursquare has been growing fast, but the company has reportedly faced trouble monetizing its operation, making it difficult for investors to put a true dollar mark on its overall value. Raising cash through debt can help sidestep some of those issues.
In a blog post announcing the funding, however, Foursquare focused solely on growth, saying the 1.3 million businesses that have signed up for its service, as well as its 33 million users, should “stay tuned” for some new things the company is working on.
“We’re building tools for local businesses to connect with their customers,” the company wrote. “We’re making search better, every single day. We’re building that location layer for the Internet — the platform that all other companies use to power location in their apps.”