More loan funding for Victorian start-ups

Venture debt provider Lighter Capital has secured $30 million in new loan funding – $10 million from Victorian government agency Invest Victoria and $20 million from private investors – to invest in Australian start-ups.

The funding is being provided under the state government’s $25 million Victoria Venture Growth Fund initiative.

Lighter Capital which operates in the US and Australia, says the new funding will be used to support growth opportunities for small and medium sized tech companies in Australia with a focus on Victoria-based start-ups.

Treasurer and minister for economic development in Victoria’s Labor government, Tim Pallas, said: “We’ve seen how start-ups can rapidly grow from one or two people to employing hundreds of people – so supporting the growth of companies like these will create jobs for Victorians. The Venture Growth Fund addresses a gap in the market where technology-focused start-ups are often considered too risky to finance.”

Lighter Capital provides up to $3 million in revenue-based financing via a fast online application process. Under Lighter Capital’s revenue-based loan model, a borrower pays a percentage of its revenue each month until the loan is repaid. The structure aligns interest payments with the earnings of borrowing companies.

Since it was launched in the US ten years ago. Lighter Capital has provided funding to more than 400 entrepreneurs, enabling them to access additional capital without giving up equity.

Lighter Capital’s Sydney-based chief executive Melissa Widner said: “Lighter Capital’s revenue-based financing provides start-ups with non-dilutive growth capital and valuable connections. Lighter takes no equity or warrants and does not require companies to give up any control. Our mission is to help founders grow their companies on their terms.”

Lighter Capital partners with Silicon Valley Bank and National Australia Bank. The company was advised on its partnership with Invest Victoria by law firm Baker McKenzie.

Image: Victorian treasurer Tim Pallas: “Start-ups can rapidly grow …”