Alternative finance models are thriving, especially when we talk about revenue-based financing (RBF) startups. The recent announcement by Capchase, which has secured €72.5 million in series B funding, confirms this. The Spanish-American RBF startup claims to have made over €1.8 billion in funding available to companies via its financing platform.
The round was led by 01 Advisors. QED, Caffeinated, Bling, Scifi, Thomvest Ventures, Tusk Venture Partners, Invesco and Gaingels also participated. The additional €72.5 million in funding comes after a year of rapid growth and product expansion, and marks a significant jump from the company’s Series A round of €22.6 million in equity.
Capchase estimates that almost 15% of financing has been extended to female and minority-led businesses
Founded in May 2020, Capchase helps high-growth, recurring-revenue businesses achieve their top priorities: financing, growing, reaching profitability, and expanding margins. Capchase provides a platform for high-growth companies to access and automate financing via cost-effective lending and financing tools. By automating all aspects of the fundraising process for businesses, the company gives founders time back to focus on the growth of their company. Since its launch, Capchase has worked with nearly 3,000 companies across the U.S. and Europe, extending runways by over 5,000 months.
Capchase estimates that almost 15% of financing has been extended to female and minority-led businesses – a significant increase compared to the limited funding these founders typically receive.
“Now, more than ever, founders need new choices when it comes to deciding how to fund their businesses,” said Miguel Fernandez, co-founder and CEO of Capchase. “It’s not a one-size-fits-all approach anymore and in just 18 months of operating, we’ve already seen an increasing appetite for growth capital that’s flexible, fast, and complimentary to traditional funding methods like venture capital. Our mission is to automate everything that touches a $, and this new round of funding will help us to launch additional products that enable founders to focus on what matters most: building and selling their product.”
More flexible financing options
Since launching its initial revenue-financing product, Capchase Grow, which enables recurring-revenue companies to access future capital upfront, the company has quickly launched two additional products: Capchase Extend, a buy now pay later solution for businesses, and Capchase Earn, a high-yield account that pays a competitive return on companies’ idle cash (such as VC funds), helping to further reduce their overall cost of capital. The firm also developed the CapScore™, a proprietary system that evaluates hundreds of data points (such as subscription rates, growth, cash on hand, etc.) and determines in near real-time a company’s ability to repay a loan, both now and in the future.
Over the last 18 months, Capchase has expanded to 10 markets, including seven European countries, and has increased company headcount to over 100 employees.
“The pace of innovation that Capchase has shown over the past two years is truly remarkable, and we believe their product suite is a game-changer in the startup funding ecosystem,” noted Dick Costolo, Managing Partner and co-founder of 01 Advisors. “With more flexible financing options, startups around the world will be able to access critical programmatic funding that is designed for the specific needs of their business, and will fuel innovation in ways that haven’t existed before.”
“Capchase has been an incredible partner and we would not be where we are today without them,” said Raad Ahmed, Founder & CEO of Lawtrades. “With Capchase Grow, we were able to unlock a significant amount of future revenue that we immediately put to use in growing the business. We grew at triple-digit rates last year and that has presented a once-in-a-lifetime opportunity for us, which would not have otherwise been possible.”
Over the last 18 months, Capchase has expanded to 10 markets, including seven European countries, and has increased company headcount to over 100 employees. The company plans to use its latest funding round to continue its momentum, expand its solutions beyond lending and hire an additional 100 employees by the end of the year.