Software and Technology (SaaS) firms face a unique financing challenge.

Their primary assets are intellectual property and long-term service contracts, neither of which traditional financing sources will lend against.

They must balance the need for capital to fund growth and the desire to avoid the dilution associated with an additional equity round.  In most instances, a higher valuation can be achieved by postponing the equity round until a high revenue threshold is exceeded.

The GCG platform includes lenders who will provide non-dilutive funding based on a percentage of the annual recurring revenue (ARR) generated from long-term B2B contracts.

These lenders are looking for situations with the following characteristics:

• B2B businesses

• One-to-three-year contracts

• Demonstrated Growth

• In business for more than 6 months

• ARR greater than $500,000

• Sufficient liquidity to cover 3 to 6 months of cash burn

  
  

Lending facilities typically include the following general terms:

• Facility sizes range from 20% to 60% of ARR

• The implied interest rate ranging from the upper teens to low twenties and

• No equity give-up or dilution

  
  

If your SaaS enterprise would benefit from this type of non-dilutive capital,

Contact:

tom.kessel@glengarrycapitalgroup.com to arrange a time to review your situation and explore whether your organization would benefit from our process and the available funding programs.