Why We Invested: Novel Capital
Redefining Financial and Strategic Solutions for Startups
The financing landscape for startup SaaS companies is fraught with generic, one-size-fits-all solutions. This contributes to staggering failure rates of 75%1 among startups across all sectors. Carta’s data illustrates that companies across all stages are shutting down at an increasingly higher rate2. Although this industry is highly cyclical and a boom will likely return, failure to grow is often attributed to a lack of proper funding.
Seasoned entrepreneurs and VC investors, Carlos Antequera and Keith Harrington, have experienced the challenges of securing tailored financial offerings firsthand for startups, setting out to build a solution. The result: Novel Capital, embarking on bridging the financing gap and meeting founders where they are with the information and funding they need.
Understanding that every company’s growth trajectory differs, Novel’s Capital Intelligence™ platform, driven by AI and real-time data, offers unprecedented insights and support for tech founders. Additionally, it provides growth capital with clear terms, payment plans, and no dilution. This robust analytics engine plugs directly into a company’s software suite to act as a “B2B Founder’s essential hub for fundraising, financing, and strategy across their capital stack”. This means diversifying a company’s funding sources (through equity and/or debt), to chart a clear path to profitability under varying scenarios, and designing a cohesive company strategy that aligns with the ultimate end goal. Whether that be an IPO, a strategic acquisition, or any other type of exit. With a proven product-market fit, Novel has had a solid trajectory addressing a critical market need, with 350+ customers served, over $100 million deployed, and 120% YoY revenue growth.
While only getting started, Carlos and Keith’s vision for Novel resonates deeply with IGNIA. Our thesis has long consisted of backing resilient founders with deep conviction about what they are building and partnering with companies that upend the status quo, especially when operating in large and expanding markets with fragmented solutions that currently don’t directly address the critical pain points. Novel’s Co-Founders understand the pain of building something from the ground up and are now channeling that experience to alleviate a primary challenge faced by founders: securing capital. This allows CEOs to focus on what they do best—operating and growing their businesses—without facing the constant challenges and difficulties of fundraising.
IGNIA is pleased to co-lead a $15 million Pre-Series A funding round for Novel, alongside Ulu Ventures. Our investment in Novel, announced last month, culminates a deep relationship with founders and co-investors, many years in the making. IGNIA Partner Christine Kenna got to know Carlos and Keith, and fellow investor Matterscale Ventures, extensively through the Kauffman Fellows network. Steve Reale, another Kauffman Fellow and Partner & CFO of Ulu Ventures, worked with Keith on various iterations of the Novel Capital model from the beginning.
The Kauffman Fellows has been a platform from which we’ve built a foundation of trust and shared goals. Yet, more than anything, it has enabled us to delve deeper into our convictions and understanding of what makes founders tick and attract exceptional talent. Viewed through that lens, we can confidently assert that Carlos and Keith uphold the values and attributes we most seek in founders.
At IGNIA we believe in building the future we want to see. Novel is the perfect enabler for the future: helping companies with limited financing options, maximize their prospects in reaching their fullest potential. We could not be more excited to join Novel Capital on this journey.
If you are a US-based B2B SaaS or technology company, join us on this journey, and discover how Novel Capital can redefine your growth trajectory. Empowering you to achieve your business aspirations with unparalleled financial intelligence and support. Contact us at: info@ignia.vc
TechReport.com - Statistics 2024, Moneyzine - Startup Resources 2023
Carta: VC Statistics - Startups Shutting Down 1Q24