Fundraising FinTech Capital has closed a $9m seed funding round led by AME Cloud Ventures.
The round also saw participation from Future Ventures, Greycroft, Wavemaker Partners and Partech as well as angel investors including Rentech and First Round Capital’s Howard Morgan and Stuart Roden, the former chairman of Lansdowne Partners.
Essentially, Capital is set up with the goal of transforming the fundraising process for SMEs. Its tech-first approach to institutional capital raising is developed to speed up the fundraising process and to make it more transparent for sophisticated companies with more than $5m of revenue, whether venture-backed or bootstrapped.
At the centre of this is the so-called The Capital Machine. The platform ingest gigabytes of complex company data in minutes, yielding a transparent, benchmarked, and predictable view of fundraising that Capital claims is 100 times more efficient than the existing process relying on human analysts, outside auditors, and spreadsheets.
With the new capital injection, the capital as a service startup will aims to strengthen its AI-based platform and expand its efforts to empower companies to better understand their current capital stacks and make optimal fundraising decisions. The round sees the total funding raised by Capital rise to over $14m.
“We founded Capital because we wanted to solve a massive problem in the fundraising process, which my own portfolio founders faced when I was a venture capitalist at Draper Fisher Jurvetson,” said Blair Silverberg, CEO of Capital. “The traditional fundraising process takes too long, is opaque to founders and early owners, and can be subject to biases. We believe that Capital offers a better way forward, with a fairer, faster, and more transparent private market process for accessing capital based on AI and direct business data.”
Nick Adams, venture partner at AME Cloud Ventures, added, “Capital is doing something that is unprecedented in the private capital world. Until now gaining access to large, sophisticated private financing has been a very manual and antiquated process. With the use of AI, classification algorithms and machine learning techniques Capital can help founders understand their true cost of capital and avoid suffering excessive dilution in order to scale.”
Steve Jurvetson, the founder of Future Ventures, added, “When I started in the venture industry in the mid-1990s, it was small, with $7bn invested in 1995. Today $140bn is invested each year in the United States with a similar amount in China. The industry has grown and matured, but its capital structure has not.
“Equity is appropriate for research and development – say, inventing a new rocket – it is not optimal for scaling sales and marketing or a myriad of other types of investment that are predictable and financed non-dilutively in other industries. The transparency created by The Capital Machine can move our industry forward and remove bias from the system as well.”
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