Presentation on funding options for growing technology companies by lender Lighter Capital.

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Funding Options
For Growing Technology Companies
AWS Loft, San Francisco
BJ Lackland
CEO, Lighter Capital
@bjlackland

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About BJ Lackland
Lighter Capital: CEO since 2012
Power Efficiency Corporation: CFO & Director
Public energy technology company, raised $20M in equity
financing, $5M in various debt financings
Summit Energy Ventures: VP & Director (Partner)
$25M venture capital fund focused on Series A & B rounds,
PIPEs, convertible debt
Other: Active angel investor and consultant to early stage
companies. Senior finance and marketing leader at tech
startups, EnCompass Globalization and webStrategic.
MBA and MA in International Studies from University of
Washington
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BJ Lackland, CEO
Lighter Capital
15+ years financing
early stage tech
companies, either as an
entrepreneur or investor.
Over $50M raised or
invested

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About Lighter Capital
52%
25%
21%
SaaS
SaaS + Service
Tech-enabled services
Digital Media
› 100+ financings across 70+ companies
› Almost 80% are SaaS
› Revenue Based Financing for tech companies
› $50k-$1mm+ funding per company
› Technology + Capital = Better for Entrepreneurs

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› The best of debt and equity – aligned interests with no dilution
› Essentially a royalty agreement until a fixed $$ amount paid
› Monthly payments = fixed % of revenue
› Fits SaaS very well
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What is Revenue-based financing?
1 2 3 4 5 6 7 8 9 10 11 12 13 14
Period
Company revenue
Loan paymentCriteria:
› Revenue: $15k-$1m/ month
› Profitability: Not required, but
clear path to profitability
› Multiple Customers
› Recurring Revenue/Customers
› High management ownership
› U.S. focus

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Today’sAgenda
The funding landscape
Your funding paths and options
Preparing for funding
Q&A
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The Funding Landscape
Cost of Entry
Speed of
Innovation
More Startups
Angels/VC
Larger Funds
Series A is
The New B
Other
Sources
Corporate
Venture
Debt + Crowd
funding

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VC Backed Non VC
Revenue$
5m
Series B
Corporate Venture
Established
Ideation
Launch &
Traction
Growth &
Scale
Breakout
Series C
Debt
Equity
Tech Banks
Series A
Revenue-Based
Financing
Blended
Series A
Series B
Tech Banks
Series C
Revenue-Based
Financing
Tech Banks
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Funding Paths
Bootstrap / Friends & Family
Incubator / Angels

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Bank / Debt
Revenue-Based
Finance
Venture
Capital
Guarantees &
Controls
Financial Covenants
Sometimes Personal
Guarantees
No Financial Covenants
No Personal Guarantees
Partner in the Business
(Board Seat, Voting
Rights)
Added Value Low / None Medium High
Dilution None / Low None High
Payment
Flexibility
Low:
Fixed Payments
Medium:
Variable Payments
High:
No Payments
Speed 4-8 months 4 weeks
Highly variable. Typical
3-9 months of focused
effort
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Funding Option Comparison

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1. Equity Valuation? What % to give up for the capital?
2. Control/Partnership Who makes key decisions?
3. Value Add More than just money? Accelerate value?
4. Risk Tolerance Personal assets?
5. Timeframe/Distractions How long will raising funds take?
6. Horizon Exit strategy? Build to exit? Build and hold?
7. Culture Is there alignment?
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Selecting a Funding Path

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Know Your Numbers
› Actual historical
› Projections & assumptions
› Key SaaS metrics
› Capitalization
Document Your Company
› Executive summary
› Investor deck
› Supporting slides / deep info
› Product demo
Get Ready for Funding – the Checklist
Take Action
› Activate your network
› Legal + accounting prep
› Keep momentum / sense of
urgency

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Financials
› MRR (Monthly Recurring
Revenue)
› Burn rate
› Zero cash date
Customer Metrics
› Acquisition costs: CAC, CAC
Ratio, CAC Payback
› Customer value: ACV, LTV
› Churn
Key SaaS Metrics
Growth
› Monthly and annual revenue
growth rates
› MRR/ARR growth rate
› 40% rule: is your growth outpacing
your burn?
Market/White Space
› Market size / disruption
› Competitors

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› $10,000 in AWS credits valid for 2 years
› Free access to the AWS Essentials 1 day web-based or instructor-led
training (normally $600/course), plus 8 tokens for self-paced labs (normally
$30/lab)
› One year of premium AWS Business Support (up to $5,000)
› Free access to 1:1 virtual office hours with AWS solutions architects
› Special offers from other companies that help startups, including Chef,
Bitnami, Amazon Payments, SOASTA, Podio, CopperEgg, CloudCheckr &
more.
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Access the AWS Activate Program with Lighter Capital

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Q&A
Visit Our Website
www.lightercapital.com
Apply Online
www.lightercapital.com/apply
See If You Qualify
www.lightercapital.com/how-it-works/see-if-you-qualify
Learn More about Lighter Capital Download the Funding
Options Whitepaper
bit.ly/1FBAtFs