At Tractor Ventures, we launched out 4 non-dilutive funding products last week.
4.
Tractor started with one in 2020, then refined that, then developed a hardware one, and that was all going fine.
Until we just simply needed to make it easier to categorise what a founder needed from funding, how much they could access in that scenario, and what scenario it is usually used for, based on the most common enquiries in our world.
Then make a product for each of those:
GROWTH. BRIDGE. EXPRESS. INVENTORY.
Accessing funding is not that complicated on our side: if you have revenue and runway, plus historical evidence that revenue has been spun up in the past via x means, then there's a likelihood that we would fund that company.
Even not being a 'technology' company is fine. ecommerce is fine, as an example. That's tech-enabled in our books, as opposed to corner stores and market stalls.
And that has worked fine in sending ~$80million out the door up until now.
But. But... there was frequently an 'it depends' based on the fact that some companies needed funding right now.
Some need it later.
Some need just a little bit immediately.
Some need the same amount spread out over each quarter.
Some need to manage shipments of stock on freighters, some have monthly recurring revenue that just continues to scale, some need to run an ad campaign tomorrow, some will hire a sales person they needed yesterday.
Whichever way you shape it, it is Debt funding.
Funding that is extremely flexible, and people who yield it can generate multiple amounts of revenue in return, to do more of what they desire at a later time.
Debt, which is a word that plenty find most unsavoury (except when it's a mortgage of course).
Debt, which is viewed as super expensive by some (which VC funding that can sometimes unnecessarily dilute some equity most definitely isn't)
*Some* simply won't entertain the thought of debt funding, based on a presumption that it's sexy like a VC round, or they want a headline, or it's expensive, or complicated, or their shareholders won't like that, or their VC's etc etc
All capital has a cost. And expectations attached to that capital. And what's important is that companies realise what they can do with the capital when putting it to work in their business, to generate ROI in a business that operates prudently.
Then fundraise if they want as well. They go hand in hand.
Tractor is pretty intent on funding the AU/NZ ecosystem (and potentially beyond, who knows?) with $1billion+ over the next 4 or so years.
I reckon we'll do that.
And meeting the market's needs, in a scenario such as this, definitely points us in that direction.
Anyone wanting to nerd out on this stuff a bit more, ping me in the DM's, shout out at Blackbird Sunrise conference this week, send an invite to our team to talk on any and all investing and brand-building events: I myself literally never STFU about it publicly. 😂