INSUBCONTINENT EXCLUSIVE:
More posts by this contributorDoes the traditional VC financing model make sense for all companies? Absolutely not
VC Josh Kopelman makes the analogy of jet fuel vs
VCs sell jet fuel which works well for jets; motorcycles are more common but need a different type of fuel.A new wave of Revenue-Based
Investors are emerging who are using creative investing structures with some of the upside of traditional VC, but some of the downside
Though RBI will displace some traditional equity VC, its much bigger impact will be to expand the pool of capital available for early-stage
entrepreneurs.This guest post was written byDavid Teten, Venture Partner, HOF Capital
You can follow him atteten.com and@dteten
This is part of an ongoing series on Revenue-Based Investing VC that will hit on:RBI structures have been used for many years in natural
resource exploration, entertainment, real estate, and pharmaceuticals
Lighter Capital is a RBI VC which has provided over $100 million in growth capital to over 250 companies since 2012.Lighter reports that
from 2015 to 2018, the number of VC investments under $5m dropped 23% from 6,709 to 5,139
2018 also had the fewest number of angel-led financing rounds since before 2010
However, many industry experts question the accuracy of early-stage market data, given many startups are no longer filing their Form Ds.John
Borchers, Co-founder and Managing Partner of Decathlon Capital, claims to be the largest revenue-based financing investor in the US
