WASHINGTON — Despite conjuring up notions of “loan sharks and vultures,” harnessing debt is a viable tool for fueling PR agency growth, experts say.

"Of course, excessive debt can be problematic, but it can also be a tool to drive innovation, profitability, and extension," said George Kypraios, CEO and founder of Yefira, a Singapore-based finance advisory firm.

Kypraios’ comments were part of a panel discussion on leveraging debt to finance growth Monday at the PRovokeGlobal summit in Washington, which also featured Geoff Allan, managing director of Partners for Growth, and Sandpiper Communications founder and CEO Emma Smith.

Allan said that leveraging debt offers certain advantages for PR agencies, as debt providers look beyond the conventional financial metrics, searching for characteristics that don't always show up on a balance sheet but indicate a debt's repayment potential.

"I think a lot of debt providers are looking at the business itself…not just some tax strategy,” he said. The focus on the business's intrinsic characteristics, its growth story, and its ability to attract debt or equity providers, he said.

Kypraios emphasized the importance of debt repayment and the debt's profile, highlighting that it's not merely about obtaining funds but about a comprehensive financial strategy.

"At its core, it's just another capital solution to how you grow a business," Allen said. Debt, when used wisely, can be a financial tool to facilitate the agency's strategic vision, he said.

Smith, who has reinvested profits in growing her firm, said she has avoided tapping debt to fund her business because she puts a premium in maintaining independence.

"We like to take chances, calculated chances. And I thought it would be easier for us to do that if we were completely independent,” she said.

Allan, however, said that debt providers aren't looking to dictate how agencies are run. Instead, they aim to provide capital and alternative solutions to help agencies achieve their goals. Allen advises conducting reference checks with companies that have worked well with debt providers, learning from both successes and challenges.