Institutional bank vs Gilion
Gilion operates under bank secrecy, all of our clients identity and financial details are strictly protected. This case details the deal of a B2B Governance SaaS raising capital for their geographical expansion.
Ticket Size
€ 5,000,000
Business model
B2B Governance SaaS
Founded
2016
Funding
Equity + Gilion Loan
Active markets
Nordics
HQ
Finland
Process
2 weeks
“The debt capacity of startups are often under estimated. We’re however able to deep-dive into the granularity of their data and in this case find a more fitting, aggressive ticket size at €5m.”
– Anders Hising, Head of Structuring.
Growth strengths
This B2B SaaS business is small but with many customers, all of whom are big, slow moving incumbents with very long decision processes. Their product is exposed to an incredibly high degree of seasonality, where all sales takes place in Q4. Their cash position is therefor over capitalised at the end of the year and weak in the time leading up. Growth is highly dependent on direct sales and networking with little reliance on marketing as an attribution channel. Retention is very high and customer concentration low, so even though their acquisition speed is halted down by seasonality effects, their overall growth remains robust.
Fundraising history
The seasonality effects of this business also means timing is not always optimal for an equity raise. They had historically taken in a total of €2m in equity over two rounds and the current shareholders wanted to put in more equity instead of a convertible loan since they saw a lot of future promise in the business. In order to mitigate the seasonality effects in their fundraising cycle they needed to find a loan product to leverage out cashflow pressure and make sure they seize maximum opportunity in the yearly sales window.
Capital use case
This business were close to tapping out of the Nordic market and needed to opt for an European expansion. Capital was needed for ESG product development, to open up more offices with local sales teams and to mitigate risks of a liquidity squeeze during low seasons.
Why Gilion
When this business came to us they already had a €2m offer from an institutional bank, which was a low estimate of their debt capacity. Banks traditionally look at annual reports and accounting metrics, which doesn’t fully capture the future financial strength of a young business. Our growth forecasting platform allows for a far more granular deep-dive and forward-looking assessment of dept capacity, resulting in a €5m offer.
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