Capital: This Company Is Providing Up To $50 Million In Non-Dilutive Venture Debt

By Amit Chowdhry ● November 7, 2019
  • Capital is a new company that is providing venture debt to companies that have growth potential. Here’s how it works.

Capital is a new company that believes that all companies should be empowered to see their businesses as clearly as seasoned investors do. Founders raising capital on average tend to give away 70% of their equity pool to venture capitalists after only four financing rounds. So Capital is providing an option for entrepreneurs to raise debt and keep equity.

Capital was founded by former Draper Fisher Jurvetson (rebranded to Threshold Ventures) investor Blair Silverberg and he serves as the CEO. The company’s executive team also includes Csaba Konkoly as president, Chris Olivares as CTO, Aaron Polhamus as VP of Data, Tory Green as COO and VP of Investing, and Monica Powers as VP of Product.

Capital recently launched with $5 million in funding from Future Ventures, Greycroft, Wavemaker, and several others, according to TechCrunch.

Plus the company also raised from a group of “institutional pools of capital” for investing between $5 million and $50 million into promising companies, which are determined by algorithms via “The Capital Machine.”

Capital’s underwriting technology is able to determine if a business has the growth potential necessary for receiving the venture debt based on revenue and other financial considerations. Then it delivers a term sheet within 24 hours.

Capital is also offering access to a free calculator that determines the cost of a company’s capital based on their venture funding rounds and valuation data.

“We are trying to create a business that is the place that all founders go to start their fundraising process,” said Silverberg via TechCrunch. “We just want entrepreneurs to understand that step one in building a balance sheet is to understand your cost of capital. Step two is you can now use that to compare your financing options. We hope we can make this process simpler and more transparent.”

So how does Capital benefit from this format? Capital charges a flat fee of between 5% and 15%.