Since its founding more than a decade ago, Lighter Capital has provided more than $200 million to over 400 companies across the U.S. Lighter Capital offers revenue-based financing that lets early-stage startups raise cash without giving up equity.
About Lighter Capital
Founded in 2010, Lighter Capital is headquartered in Seattle, Washington. The firm provides small businesses up to $4 million in financing, which doesn’t require equity or personal guarantees.
In addition to revenue-based financing, Lighter Capital offers its clients additional benefits such as the “Lighter Capital Community” where client companies can network with other CEOs and entrepreneurs. The firm also offers clients startup-oriented discounts on products and services from Silicon Valley Bank.
Eligibility & Products Offered
Lighter Capital’s revenue-based financing model (also known as RevenueLoan) is designed for companies that are currently generating at least $200,000 in annual revenue. The firm requires an average of $15,000 of monthly recurring revenue (MRR) over the previous three months before applying for financing. Companies applying for a loan do not need to be profitable.
Companies can qualify for loans of up to 33% of their annualized revenue run rate. For example, if the enterprise is on track for $1 million in sales this year, Lighter Capital can invest up to $330,000.
Lighter Capital receives a percentage of revenue (usually between 2% and 8%) until the total repayment cap is reached. Generally, this is calculated and debited monthly via an automated clearing house.
Lighter Capital also offers term-based financing and contract-based financing. Both products have a maximum loan amount of $4 million.
Currently, Lighter Capital provides funding to companies in the United States, Canada, and Australia. The firm focuses its funding on companies involved with software, SaaS, tech services, digital media, and similar companies in what they consider to be “high-growth, high-margin markets.” (Source - August 2022).
How to Apply
To apply for funding, companies must apply online (Source - August 2022).
Capchase vs. Lighter Capital
In addition to financing using venture debt from Lighter Capital, founders and startups can work with Capchase. When compared to Lighter Capital, Capchase’s funding model is designed to remove excess fees that can save clients up to 50% when compared to traditional venture debt providers (Source – June 2022).
It can be helpful to see the differences between Capchase and Lighter Capital side-by-side. This is especially true for key areas like speed to funding, flexibility, structure & fees, and value add.
Speed
Capchase
48 hours to underwrite (led by a tech-driven & highly responsive underwriting system)
Lighter Capital
A quick underwriting process
Flexibility
Capchase
Highly Flexible: No traditional financial covenants on amounts financed
Lighter Capital
Fairly flexible: No minimum net worth, working capital, current ratio, quick asset ratio, liquidity ratio, or debt-to-equity ratio is required to apply
Structure & Fees
Capchase
Transparent & Simple: No prepayment fees, closing fees, warrants, or hidden fees
Lighter Capital
Terms around prepayment, expensive closing process, warrants, admin fees
Value Add
Capchase
A prescriptive funding plan
Lighter Capital
Discrete funding events
