Capchase, which was part of our fifth Entrepreneurs List, just announced its latest round. It totals $280 million, to which must be added the $5 million they made in one Sed round and the $125 million in another Series A. In all, more than 400 million, which, as they themselves admit, they could not receive if the company was incorporated in Spain instead of Boston.
The history of Capchase It’s short It was in the midst of the pandemic, in May 2020, when they were formed as a company via telematics. In July of the same year they land their first client, a month later their first 5 million investment and from there they start to rise like foam. Today they have more than a hundred clients, mainly in the US, and expectations are very high as the team’s aim with the new funds is to expand its help to finance the ecosystem of businesses across Europe on a recurring revenue basis.
Capchase was born from the hand of Miguel Angel Fernandez Larrea, Luis Basagoiti Marques, Ignacio Moreno Pubul and Przemek Gotfryd. Some of the founders of the team already knew each other as former colleagues at Geoblink, others only met in person months after the founding.
Capchase was born to fund companies that operate on a subscription model. Once these types of businesses have customers and an interesting history, they are usually low-risk as they can predict earnings in terms of 1, 3…12 months and move accordingly. The problem is that sometimes, from the moment they sell the solution until they get that revenue, a gimmick occurs that jeopardizes the survival of these businesses due to lack of liquidity.
With the solution offered by Capchase, instead of having to wait for money from clients, companies can ask this fintech to push it up to 12 months of expected income to be able to reinvest it and keep growing without delay.
As for the type of companies they finance, there are basically two types: those who are used to using venture capital because they need a lot of money and know how to use it quickly and multiply faster, in comparison to others who are willing to finance themselves with only their own resources. Used to handling the box very efficiently, these second ones, when they advance the money in Capchase, they succeed wonderfully. As for the activities they operate with, there are all kinds, up to more than 50.
The simple idea of Capchase
As for the key to Capchase’s overwhelming success, one of the team members, Luis Basagoiti, ignores the idea’s success and its brilliant execution, but lists three aspects that he believes were key:
a simple idea. It may seem silly, but being able to explain the reason your company exists in a way that everyone can understand what you do is a point in their favor as everyone can appreciate the value you bring to the market . The way they realized that the simple idea they had in their hands was that people often reacted to it, but doesn’t that exist anymore?
Within the recurring economy. Also known as the Subscription Economy. It’s a global trend that’s growing exponentially, forcing many companies to reinvent themselves. At Capchase, they’ve focused on these types of businesses that are learning to thrive on recurring revenue.
the timing. Capchase was born amid a pandemic, a time when, despite ample capital in the market, investment contracts left many companies with a lack of liquidity given the uncertain environment. For them, this was the perfect breeding ground to test their product and demonstrate the effectiveness of the solution.