Fintech Kashcade has raised an additional $1 million from existing investor Prandium Capital and several high net worths, alongside a $22 million warehouse facility funded by asset-backed lending specialist Rixon Capital.
The digital lender offers startup founders non-dilutive capital and will use the debt warehouse to expand into the R&D lending space, so companies can borrow against future R&D Tax Incentive (R&DTI) refunds, alongside improvements to the fintech’s automated financial analysis software.
The challenge for cash-starved startups is that the R&DTI can take between 12 and 18 months to hit the bank account following the expenditure.
While not new, Kashcade’s promise is speed, with loans approved in 48 hours compared to competitor lenders who can take weeks to sign off on the deal.
The new capital injection comes less than six months after a similar $5.5 million debt and equity deal for the business lender, which launched last year.
Kashcade cofounder and CEO Alex Simmons said they received multiple debt term sheets, but concluded that Rixon was the right choice because of its understanding of the asset class. The R&D Tax Incentive program is worth around $3 billion annually.
“Our customer base would consistently ask us to lend against their R&D rebate,” he said.
“We eventually concluded that, with our tech platform and appreciation of the nuanced needs of fast-moving start ups, we were well-positioned to be able to provide a killer offering in this space. And now, we do.”
Kashcade’s typical loan size is $300,000, but it can fund loans up to $1 million, secured against the R&D tax refund
Simmons said they don’t ask for equity, warrants or options, restrictive covenants or guarantees from directors.
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