Image credit: Outfund
London-based Outfund, a fintech company that claims to be the UK’s largest revenue-based finance provider, announced on Wednesday that it has raised £115M (approximately €136.59M) in its Series A equity and debt round of funding.
Outfund says that the funds will support its global growth and offer bigger lending rounds to more businesses. The company looks to invest more than £500M (approximately €594M) of lending to over 5,000 businesses in the next 12 months and will increase its lending limit to £10M (approximately €11.88M) per company.
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In addition to this, Outfund also has plans to invest in new products, such as working capital and revolving credit, as well as in team growth. This funding round and growth plans mean that Outfund will now be the largest revenue-based finance provider in the UK, Spain, and Australia.
Investors in this round
The round was led by London-based VC firm Force Over Mass, Switzerland’s PostFinance, Guernsey-based 1818 Venture Capital, and US-based Tribe Capital.
Mark Pearson, founder and managing partner of Fuel Ventures, says, “Outfund is pivoting the model of business funding, rebalancing the scales so that business owners don’t lose out financially while getting the capital they need to supercharge their online business’s growth. At Fuel Ventures, we work with the most ambitious entrepreneurs to build market-leading companies.”
Filip Coen, Partner at Force Over Mass, adds, “Outfund provides SMEs with the short-term financing options they deserve: fast, flexible and on good terms. A modern, digital-first credit provider with automated credit and risk scoring, managed by an exceptional team. We are very excited to join Daniel and Outfund on the journey ahead.”
“Capital, that is fast, fair, and affordable”
Founded by Daniel Lipinski, Outfund serves as an alternative financing channel that lets businesses get the funds they need based on their future revenue projections and at fairer terms and rates. Founders seeking capital can apply for finance using Outfund’s online application.
Businesses connect their revenue accounts and, with access to this data, Outfund builds a funding offer and deploys it the same day. Its algorithm pulls information from multiple data sources to determine how a company performs and is then able to de-risk the proposition. This allows for more affordable funding with longer payment terms and a flat fixed fee starting from 2 per cent, making it the most competitive offering in the market.
Unlike conventional business loans, Outfund ensures the time taken to repay is based on each businesses’ circumstances, with an agreed revenue share creating flexibility for founders. Outfund’s revenue-share percentages are set to ensure each business maintains a healthy cash flow in its day-to-day operations – the better the company does, the better Outfund does.
Daniel Lipinski says, “What sets us apart from the market is our technology and our ability to provide in-product finance solutions to almost any partner, ensuring not only rapid growth but also the ability for our partners to provide a range of value-add financial products to their customer base.”
Currently, Outfund deploys between £10,000 (nearly €11,881) and £10M (approximately €11.88M) of funding, and is available to businesses that take online payments, have a minimum of £10,000 monthly turnover, and have been trading for at least six months.
Lipinski adds, “As a second-time entrepreneur myself, I experienced first-hand the complex, timely and often imbalanced nature of the old-school financing routes. I knew there was another way and so decided to build it. Our ambition is for Outfund to be the place to go to grow your business, without compromising your equity or wasting time fundraising. This is why we have spent time developing a way to make the process of securing money for growth easier, fairer and, most importantly, faster. Our approach has been warmly received by the founders and directors so far, and now we’re looking at how we can open this up to more businesses and continue to be part of their journey to success for a long time.”
The company claims to have witnessed significant growth in 2021, growing revenues sixfold and expanding into three new countries.
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