Founderpath Raises $10 Million Fund, Creates Alternative to Venture Capital for Bootstrapped SaaS Founders 

Tuesday, 02. March 2021 23:00

AUSTIN, Texas, March 02, 2021 (GLOBE NEWSWIRE) -- Founderpath helps bootstrapped SaaS founders get cash without selling equity or wasting time with banks. They do this by converting monthly recurring revenue into upfront cash. The company raised a new $10 million fund to keep up with demand, added former Goldman Sachs CFO R. Martin Chavez to their advisory board, and poached a key executive to manage the growing fund. 

The new capital comes from successful bootstrapped SaaS founders like David Hauser (Grasshopper exit $171m to Citrix), Bill Boebel (Webmail to Rackspace), and Dan Martell (Clarity.fm, Flowtown) who all know the power of keeping equity. “We’ve raised this fund now because other providers seem to be moving upstream to enterprise and ignoring the needs of Bootstrapped SaaS founders,” says founder Nathan Latka. “We’re seeing incredible demand. 1,500 SaaS founders have connected to Founderpath. Founders with just $10k in monthly recurring revenue can use Founderpath to grow to $10m, keep 100% equity, and focus on product and customers instead of fundraising.”

To get capital from Founderpath, founders connect Stripe or whatever platform they use to store customer information. From signup to getting capital can take under 3 days.  “We needed a quick $350k to hire an engineer and test new channels. We converted 182 customers from MRR to upfront cash using Founderpath. Took under a day to get the cash,” said Audiense founder Javier Buron. Buron isn’t alone. Founderpath is approving $1 million per week and sees a clear path to “deploying $100m in the next 12 months.” The company has been able to attract Founders using Latka’s media business focused on SaaS founders including GetLatka.com, The Top Entrepreneurs Podcast, and Latka Magazine. Latka has signed with talent agency CAA

The team is focused on how they can help SaaS founders besides just turning MRR into upfront cash. “Many companies in our space are raising tons of VC to deploy capital at all costs. They’re betting on doing deals with public SaaS companies and deploying billions of dollars to keep up with “raise more or bust” model.” Founderpath is betting that helping founders with free reporting to drive down CAC, increase net dollar retention, and identify new distribution channels will better serve founders over the long run.

Major thought leaders in the SaaS space are getting behind the company. Jason Lemkin, Founder of Echosign and SaaStr is joining the company as an advisor. “Getting upfront cash is becoming a critical part of the toolkit for capital-efficient SaaS companies.  I've watched founders get capital in under 30 minutes going through Founderpath. Latka’s trusted brand in the SaaS space will ensure the top up-and-coming Cloud companies come to Founderpath to explore their options for “cash now”,” said Lemkin. This addition is critical for Founderpath considering Lemkin built and sold EchoStar for $300m before launching SaaStr and its flagship 15,000 person conference.

The company has added former Goldman Sachs CFO R. Martin Chavez to help unlock better terms for founders.  Founderpath’s ability to turn MRR into upfront cash will depend on how much cash it has to deploy. “Making upfront capital more accessible is a fantastic way to drive innovation. I look forward to helping Founderpath get access to cheaper capital so they can pass the savings on to SaaS founders. We believe SaaS receivables will be a large asset class and Founderpath is well positioned to take the idea mainstream,” said Chavez.

To support the growth, Founderpath is also announcing that former Espresso Capital and CIBC executive Kevin Houston is joining the company. Houston helped Espresso deploy over $200m to SaaS founders over the past 2 years. Houston will round out a 4 person team with bootstrapping in their blood. Mubs Iqbal was Product Hunt maker of the year in 2016 and leads development. He’s joined by Charlie Martin who worked at Google before quitting to hack on side projects. Nathan Latka built his first SaaS company in 2011 in college, scaled it to $1m in revenue, then exited in 2015.

Benefits of Founderpath include:

-Speed: Average time from founder signing up to receiving capital is 3 days. 

-Focus: Built for bootstrapped SaaS founders who want to convert MRR into upfront cash. “When we built Grasshopper to $30m in revenue, I was able to keep equity by raising debt. This extra cash gave us incredible leverage when we sold to Citrix for $171 million. As founders, we made more at the exit than our VC backed competitors because we kept control and equity,” said Hauser. “Founderpath is now giving founders this leverage at scale, and it’s not actually debt. Using MRR to get cash upfront is the modern day version of what I did at Grasshopper. I'm excited to be an early investor in Founderpath's fund for bootstrappers.”

-Cost: Founders can get 11 months of upfront cash for customers currently paying monthly. Cost based off SaaS credit score. 

-Community: Slack community of 895 SaaS founders. Weekly AMA’s with successful SaaS founders. Monthly webinars to exchange growth ideas, metrics, and benchmarks. 

To see how much capital you could get, please visit Founderpath.com or email nathan@founderpath.com

About Founderpath:
Founderpath was launched in 2019 as a way for bootstrapped SaaS founders to get capital without selling equity. The company integrates with Stripe, Recurly, Chargebee, Chargify, Profitwell, Plaid, Quickbooks, and Xero to analyze the strength of a SaaS company. The stronger the company, the more capital founders can take. The team is remote, built by bootstrappers, and funded by bootstrappers. See how much capital you could get by visiting Founderpath.com

Contact:
Nathan Latka
nathan@founderpath.com
(657) 201-7089

Submitted via Volume Digital, a full scale digital agency specializing in brand development.

 


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