SME non-dilutive financing provider Karmen nets €50m debt

SME non-dilutive financing provider Karmen nets €50m debt

Just 10 months after its first financing round, SME non-dilutive financing provider Karmen has raised €50m in debt.

The funds were supplied by Fasanara Capital, an owner-managed alternative asset management firm.

With the funds, the company hopes to accelerate its mission of transforming corporate financing.

The company was founded in 2021 and initially focused on revenue-based financing for recurring revenue companies. It has since expanded its offer to all digital VSEs/SMEs, to better respond to their quest for financing in a rapidly changing macro-economic context.

Karmen supplies instant financing for digital companies. Loans range from €10,000 to €5m.

Its loans are offered as a non-dilutive and are indexed to the company’s turnover. Through a plug and play digital platform, the FinTech company allows a borrower to share their data from their tool suite, including invoicing, accounting and banking. With this, Karmen assesses the credit risk and determines whether they are eligible for financing.

Karmen CEO and co-founder Gabriel Thierry said, “With rising inflation, volatile commodity prices and the end of low interest rate policies, the paradigm of the VSE/SME financing market is changing. In this context, alternative solutions, focused on technology and speed of financing, are gaining momentum and taking precedence over traditional credit offers.”

The SME non-dilutive financing provider previously raised €22m in January 2022. The round included €3m in equity and €19m in debt, which was supplied by Fasanara.

Since this capital injection, the company has hired staff for its sales, marketing, credit and partnership teams, having quintupled its workforce to 20 employees.

FinTech Global recently spoke to SME Finance CEO and co-founder Mindaugas Mikalajūnas about the role of SME lending during the market downturn.

He said, “There is no need to suffer unnecessarily and downsize painfully in order to survive the crisis. The most important goal should be to stay in the market and remain competitive – at any cost.

“It is important to understand that every crisis brings with it new opportunities that must be exploited. Therefore, I am convinced that a business that looks for opportunities, not just ways of saving or scaling back, is more likely to survive and thrive.”

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