A $100 million funding initiative exclusively for women and minority-led businesses, which face well documented challenges securing venture funding, was announced today by Capchase, a New York-based provider of non-dilutive capital for recurring-revenue companies.
Capchase has taken a strictly data-driven approach to funding decisions, relying solely on company fundamentals and scenario analysis. The company believes this approach has removed unconscious biases known to influence venture funding. To date, more than 10% of the total financing that has been advanced by Capchase has gone to minority and women-led founders.
“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.
Recent research from the Harvard has found that less than 1% of overall venture capital funding has gone to minority-led 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.
“When you look at the disparity in funding opportunities however, it’s almost mind-blowing,” Fernandez said. “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 a team of former SaaS operators—Miguel Fernandez, Luis Basagoiti, Ignacio Moreno, and former VC Przemek Gotfryd— and helps recurring-revenue to 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. Click this link to learn more about Capchase and to apply for funding.