Revenue Based Growth Capital for New Age Entrepreneurs of India

Entrepreneur-friendly capital to help you grow while keeping your vision and independence intact. Data-driven process provides quick access to capital without any collateral or personal guarantee.

BY ENTREPRENEURS FOR ENTREPRENEURS

We are a $100M fund that solves four major challenges faced in the typical fundraising process.

No Personal Guarantee

No Personal Guarantee

No exposure to entrepreneur's personal assets. Suitable for asset-light companies.

Raise Capital in Weeks

Raise Capital in Weeks

Tech-driven Risk Scoring Model. Faster capital allows faster time to market & scale.

Have Greater Flexibility

Have Greater Flexibility

Monthly commitment based on revenue with payback tenors ranging from 1-3 years.

Constant Capital Infusion

Constant Capital Infusion

Complements other forms of capital, provides extended runway and a continuous flexible line of credit.

HOW N+1 CAPITAL WORKS?

N+1 Capital is pioneering Revenue Based Growth Capital (RBGC) in India.

Investment Amount upto 4x of Monthly Revenue.

Repayment Mechanism: Monthly Revenue Share, typically between 2% to 9%.

Top-up Capital can be provided continuously for growth

Payment Structure at NP1 Capital

ENTREPRENEURS' BENEFIT

The example below depicts 2 scenarios in which an entrepreneur raises Venture Capital With and Without Revenue Based Growth Capital.

Metrics at next funding round Without N+1 Capital With N+1 Capital
Existing ARR 10 Cr 10 Cr
Current Monthly Growth Rate 3% 3%
N+1 Capital Infusion NA 2 Cr
Revised Monthly Growth Rate 3% 5%
Revised ARR (After 1 Year) 14.25 Cr 17.95 Cr
Valuation Multiple 10x 10x
Valuation (Pre Money) 142.5 Cr 179.5 Cr
Funding amount 20 Cr 20 Cr
Valuation (Post Money) 162.5 Cr 199.5 Cr
Dilution 12.31% 10.03%
Founder’s Stake (Pre Investment) 80% 80%
Founder’s Stake (Post Investment) 70.15% 71.98%
Founder’s Net Worth (Post Investment) 114 Cr 143.6 Cr

Cost Benefit Analysis

Debt Amount 2 Cr
Interest Paid (A) 40 Lakhs
Valuation Increase (B) 37 Cr
Net Benefit (B-A) 36.6 Cr

TARGET COMPANIES FOR N+1 CAPITAL

N+1 Capital is a Sector Agnostic Fund which would invest in companies that have:

Annual Revenue of 10 Cr+ in last financial year

Annual Revenue of INR 10 Cr+ in last Financial Year

Low, Moderate or High Growth

Low, Moderate or High Growth

25% or more Gross Margin

25% or more Gross Margin

Low or Negligible Existing Debt

Low or Negligible Existing Debt

OUR VALUES

FREQUENTLY ASKED QUESTIONS

  • How do you differ from a typical Venture Capital or Private Equity Investors?

    We are an investment firm that provides funding on a share of revenue basis. Investments are not collateralized; there are no equity sale requirements. Investment contracts are structured so that repayment is sourced solely from an agreed-to percentage of revenue and capped per mutual agreement. Given a shared objective of revenue growth – as opposed to positioning for IPO or strategic acquisition – there is no need for difficult front-end valuation processes.

  • Banks and other lenders require a set payment schedule irrespective of company performance. Our investments are repaid solely on the basis of revenue. If sales trend lower than expected, payments decrease proportionately. If sales are higher than anticipated, the investment is repaid early. Lenders also require hard assets or other personal guarantee to collateralize a loan. Our revenue-sharing investment structure eliminates these requirements.

  • We will only finance revenue generating activities. We're looking for repeatable and scalable processes that have a history of yielding a growth in revenue. These activities can range from hiring employees, marketing or advertising spend, inventory purchases, or any use of capital that will lead to higher revenue. We will not finance the consolidation of debt, payoff existing debts, R&D capex etc. Investments are typically utilized for operational objectives including but not exclusive to new product launches, sales expansion, and working capital for inventory and/or receivables.

  • Just like bank financing, venture debt requires fixed payments, collateralization of hard assets, and other personal guarantee. Also, venture debt typically requires an ownership stake in the form of warrants. We don’t have any of these requirements. Most importantly Venture Debt requires the presence of a VC investor on your cap table which we do not.

  • Our due-diligence process is thorough yet more focused than other sources of investment capital. Analysis is focused solely on the company’s ability to generate sustainable revenue and gross margin to cover the investment while allowing the company to thrive. Since positioning for IPO or strategic acquisition is not the objective of investment – and therefore no need to evaluate the potential for this type of outcome – analysis is dramatically simplified.

  • The size of the investment is typically up to 4x of monthly revenue with a minimum of INR 1 Cr and a maximum of INR 15 Cr.

  • We invest based on recurring revenue, not profit. Burning cash to grow is part of high growth strategies; we like to see this done in a managed way which fits into the objectives and growth plan of the business. If a company has low debt, a plan, low churn, and enough revenue, we are fine with pre-profitability.

  • Prepayment is allowed under certain situations on a cases to case basis.

Media

N+1 Capital in the Media.

  • All
  • Industry Insights
  • Firm Coverage
  • Portfolio

Economic Times

WE'D LOVE TO HEAR FROM YOU!

Reach out to us for investment opportunities by applying here.

For any other queries, reach out to us at contact@np1.in