NEW YORK, April 29, 2021 /PRNewswire/ — Capchase, a New York-based provider of non-dilutive capital for recurring-revenue companies, has today announced a new initiative that will provide funding exclusively for women and minority-led businesses. The company is setting aside $100M to ensure that these founders, which have historically received a disproportionately small share of total venture funding, will have equal access to sufficient growth capital.
Recent research from the Harvard Kennedy School1 has found that less than 1% of overall venture capital funding has gone to minority-founded businesses and ~2.3% has gone to women-founded businesses. Additionally, women and minority-led businesses typically see lower valuations and as a result, give up more dilution in their fundraising journey. This comes at a time when the number of women and minority-led businesses are growing faster than ever. Data from the Securities and Exchange Commission has found a 38% increase in the number of minority-led businesses since 2007, and a 17% increase in women-led businesses since 2017.
By taking a strictly data-driven approach and basing funding decisions solely on company fundamentals and scenario analysis, Capchase has removed all of the unconscious biases that have traditionally existed in venture funding. To date, more than 15% of the $150m+ in total funding Capchase has made available to tech startups has been delivered to women and minority-led startups.
“At Capchase, we are proud to work with the most inspiring and innovative companies who are leading their respective industries,” noted Miguel Fernandez, co-founder and CEO of Capchase. “When you look at the disparity in funding opportunities however, it’s almost mind-blowing. Based on our experience with hundreds of companies across the country, we’ve seen first-hand the struggles that women and minority founders face when trying to access funding. By committing this dedicated growth capital, we hope to play a role in overcoming the roadblocks that have prevented so many quality businesses from securing critical funding.”
Additionally, the importance of securing funding that is non-dilutive, such as the programmatic funding advanced by Capchase, cannot be overstated. Research has found that equity is one of the biggest sources of wealth for individuals, making the balance of maintaining ownership crucial. Funding from Capchase, which is unbiased and based on data, helps founders preserve more equity throughout their growth journey and increase the value of that equity at a faster rate.
Capchase was founded in 2020 by an all- immigrant team of former SaaS operators—Miguel Fernandez, Luis Basagoiti, Ignacio Moreno, and former VC Przemek Gotfryd— and helps tech companies grow faster and avoid dilution by unlocking cash that is otherwise tied up in future predictable payments. This allows founders to either reinvest the upfront capital in profitable growth initiatives, or secure cash on hand to extend their runway.
Funding under the initiative is available immediately. To learn more about Capchase, and apply for programmatic funding for your business, please visit www.capchase.com.
1 Harvard Kennedy School, “Improving Gender Equality in the US Venture Ecosystem,” By Melissa-Ann Gillies
Capchase is a platform for recurring-revenue companies to secure non-dilutive capital. Founded in Boston, MA in 2020, the company provides financing by bringing future expected cash flows to the present day – thereby extending an immediate line of credit. Companies that work with Capchase are able to secure funding that is fast, flexible, and doesn’t dilute their ownership.
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