Revenue-based financing platform Klub has raised $20 million (around Rs 148.6 crore) in a seed round from 9Unicorns and Sequoia Capital India’s Surge, along with Alter Global and GMO Venture Partners.
The fresh capital will be used to hire staff to accelerate its data platform and expand into new product offerings and market segments.
Founded by Anurakt Jain and Ishita Verma, Bengaluru-headquartered Klub provides flexible growth capital ranging from Rs 2 lakh to Rs 30 crore with zero equity dilution or personal guarantees.
The firm provides funding for recurring marketing, inventory and CAPEX spends to a wide variety of digital-first companies and SMEs.
Klub uses its data-driven underwriting process to make faster funding decisions, with emphasis on the cost of capital appropriately reflecting the inherent risks in business across sectors.
The company evaluates risk profile of a brand by using APIs (application programming interface) to get data from third parties, like Banking and financial statements and GST among others.
Klub said that over 500 businesses have explored funding. Klub sources capital from institutional partners and super-fans of the brand, working as a hybrid marketplace.
“We are extremely bullish on revenue-based financing and as early backers; we are proud to see Klub quickly become the market leader.
At 9Unicorns, our investment thesis is designed to be founder-first and back products that work for both small and large businesses, and have a value proposition for Tier 2/3 India. In Klub we found the perfect mix”, Apoorva Ranjan Sharma, co-founder, and president of 9Unicorns, said.
Klub has raised funds for direct-to-consumer brands like SMOOR, The Label Life, Petsutra, Tjori, TagZ Foods among others. The firm aims to fund 350 brands and partner with 5000+ patrons by end of 2021.
The company said it is looking into other South Asian markets, which is witnessing growing startup ecosystem.
Klub was represented by Wadhwa Law Offices as the legal counsel.