In a tight capital market, TIMIA Capital secured $100 million through a joint venture with Arena Investors, and is ready to deploy it to tech startups with $2 to $50 million in annual recurring revenue (ARR).
In a competitive financial landscape for tech startups, TIMIA Capital has made a pivotal move to support larger growth-focused tech startups with bigger disbursement amounts.
Previously, our focus was limited to companies with an ARR between $2 and $20 million due to our fund’s capacity and portfolio-balancing requirements. Today, we have access to a larger fund and can now offer interest-only and amortized loans to tech startups with an ARR between $2 and $50 million.
Bridging the Finance Gap for Larger Growth-Stage Companies
Since the collapse of SVB and the slowdown of venture capital markets, larger growth-stage companies with ARR up to $50 million have been left with fewer funding options.
TIMIA now seeks to bridge this gap. We are excited to extend our unique loan structures (which have been popular over the past four years with companies with a $2-20 million ARR) to cater to larger growth-stage companies.
Our innovative loan structures — including interest-only and amortized loans — combined with TIMIA’s robust financial backing through a joint venture with Arena, allows us to support bigger players in the tech startup ecosystem.
Advantages of TIMIA’s Loan Offering
TIMIA’s loan offerings are uniquely tailored to tech companies striving for growth while maintaining control over their operations and ownership. As with our other tech-friendly loans, benefits include:
- Subordination to Senior Debt: TIMIA’s flexible lending approach includes the ability to subordinate its loans to senior debt. This arrangement provides tech companies with an added layer of financial flexibility and security.
- No Warrants Taken: TIMIA does not take warrants. Equity is not diluted or compromised, so founders retain full ownership of their businesses.
- No Sponsor Required: TIMIA’s loan structure does not require a sponsor. This approach allows bootstrapped companies to access necessary capital without the often burdensome prerequisite of securing venture capital or other sponsors.
- No Board Seat Required: TIMIA understands the importance of maintaining autonomy in a startup’s decision-making process. Therefore, unlike many traditional funding mechanisms, TIMIA’s loan offering doesn’t require the company to surrender a board seat.
How TIMIA Capital Can Fuel Your Company
Our loans can help larger companies navigate their growth journey with more flexibility. Some of the common goals for larger loans at growth-stage companies include:
Delaying Equity Raises
Tech startups aiming to defer their next equity raise to prevent dilution can benefit from this debt financing option. It provides the necessary capital to propel the business forward without diluting equity stakes.
Reaching Cash Flow Positivity
These loans can provide the necessary financial boost for tech startups striving to achieve a cash flow positive status, a crucial milestone for any business.
Facilitating Business Model Transition
For tech startups looking to pivot their business model or decrease their services revenue, TIMIA’s debt solutions can provide the much-needed capital during this transformative phase.
Positioning for an Acquisition
For tech companies that are positioning themselves for acquisition, a forward-facing loan provides a strategic timeline to enhance key financial metrics that potential acquirers find appealing. Simultaneously, this type of loan maintains a straightforward capital structure, avoiding complications on the cap table.
Debt Financing as a Growth Catalyst
Debt is an effective tool for tech startups to reach their next milestone without diluting their ownership.
With a newfound ability to cater to a broader range of tech companies, TIMIA is demonstrating its commitment to supporting the growth and success of larger tech companies. CEOs and CFOs looking for growth capital with flexible use cases now have another compelling option to consider.
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