Capchase raises $60m in new funding, expands opportunity for early-stage SaaS startups to secure non-dilutive capital

Capchase raises $60m in new funding, expands opportunity for early-stage SaaS startups to secure non-dilutive capital

Published: 14-01-2021 10:00:00 | By: Pie Kamau | hits: 1846 | Tags:

Capchase, a Boston-based provider of non-dilutive capital for Software-as-a-Service (SaaS) companies, announced $60 million in additional funding, led by specialty finance firm i80 Group.

Founded in early 2020, Capchase has quickly established itself as an alternative to dilutive venture capital and venture debt for recurring revenue companies. The new funds will be used to expand the number of companies it can extend financing to, and the amount of revenue prepayment it provides.

Founded by a team of former SaaS operators Miguel Fernandez, Luis BasagoitiIgnacio Moreno, and former VC Przemek Gotfryd Capchase helps recurring-revenue companies unlock cash that is otherwise tied up in future subscription-based payments. This allows founders to either reinvest the upfront capital in profitable growth initiatives, or secure cash on hand to extend their runway.

Miguel Fernández, CEO and Co-founder, Capchase: "The capital we've raised through i80 Group will enable us to rapidly grow the number of startups that we work with and establish our position as the leading provider of alternative financing solutions for early- and growth-stage SaaS companies."

Capchase has a significant impact on the businesses it finances. Founders who partner with Capchase delay equity raises by about eight months, raise capital on more favorable terms, and can become cash flow positive. As a result of working with Capchase, founders save 16% in dilution on average while avoiding costly discounts for upfront cash.

Marc Helwani, Managing Partner, i80 Group: "Capchase has created a phenomenal solution, and we are proud to welcome them into our growing portfolio. Securing non-dilutive capital is critical for startups and Capchase offers a meaningful alternative."

This funding comes on the heels of a $4.6M seed round, announced in August of 2020. Since its inception, Capchase has disbursed tens of millions of dollars to fast-growing businesses with recurring revenue.

Aishwarya Dahanukar, Head of Capital Markets, Capchase: "The successful closing of this financing during a period of extreme financial and political uncertainty demonstrates the appetite among institutional investors for alternative credit providers that mitigate risk appropriately."