Revenue Based Growth Capital for New Age Entrepreneurs of India

We are an investment firm that provides funding on a share of revenue basis. Investments are not collateralized; there are no equity sale requirements. Investment contracts are structured so that repayment is sourced solely from an agreed-to percentage of revenue and capped per mutual agreement. Given a shared objective of revenue growth – as opposed to positioning for IPO or strategic acquisition – there is no need for difficult front-end valuation processes.

Banks and other lenders require a set payment schedule irrespective of company performance. Our investments are repaid solely on the basis of revenue. If sales trend lower than expected, payments decrease proportionately. If sales are higher than anticipated, the investment is repaid early. Lenders also require hard assets or other personal guarantee to collateralize a loan. Our revenue-sharing investment structure eliminates these requirements.

We will only finance revenue generating activities. We're looking for repeatable and scalable processes that have a history of yielding a growth in revenue. These activities can range from hiring employees, marketing or advertising spend, inventory purchases, or any use of capital that will lead to higher revenue. We will not finance the consolidation of debt, payoff existing debts, R&D capex etc. Investments are typically utilized for operational objectives including but not exclusive to new product launches, sales expansion, and working capital for inventory and/or receivables.

Just like bank financing, venture debt requires fixed payments, and other personal guarantee. Also, venture debt typically requires an ownership stake in the form of warrants. We don’t have any of these requirements. Most importantly Venture Debt requires the presence of a VC investor on your cap table which we do not.

Our due-diligence process is thorough yet more focused than other sources of investment capital. Analysis is focused solely on the company’s ability to generate sustainable revenue and gross margin to cover the investment while allowing the company to thrive. Since positioning for IPO or strategic acquisition is not the objective of investment – and therefore no need to evaluate the potential for this type of outcome – analysis is dramatically simplified.

The size of the investment is typically up to 4x of monthly revenue with a minimum of INR 1 Cr and a maximum of INR 15 Cr.

We invest based on recurring revenue, not profit. Burning cash to grow is part of high growth strategies; we like to see this done in a managed way which fits into the objectives and growth plan of the business. If a company has low debt, a plan, low churn, and enough revenue, we are fine with pre-profitability.

Prepayment is allowed under certain situations on a case to case basis.