London-based RBF player Bloom has secured £300 million in a Credo and Fortress-led Series A round. According to the company, this capital makes Bloom the highest-funded revenue-based lending business in Europe. However, this falls well short of Irish competitor Wayflyer who’s clocked in close to $640 million. Unless Bloom is segmenting debt and equity funding? Or perhaps the claim lies in “lending business”? Either way, $640 million > £300 million.
But I digress.
If you’ve been following along at home over the past 9 or so months, my coverage of European revenue-based finance players has grown increasingly skeptical. Some might even say, jaded; as a journalist, a badge I wear with pride.
|Name||Location||Turnaround time||Revenue Range||Pre-requisites|
|Karmen||France||< 48 hours||40% ARR||-|
|Vitt||London/Berlin||< 24 hours||100% ARR||ARR of £100,000|
|re:cap||Berlin||< 48 hours||50% ARR|
|Ritmo||Madrid||< 24 hours||up to €3 million|
|Requr||Amsterdam||< 24 hours||unspecified cap||MRR of €20,000|
|Viceversa||Milan||< 72 hours||€10,000 - €1 million|
|Wayflyer||Dublin||< 24 hours||$10,000 - $20 million||MRR of $20,000|
|Silvr||Paris||< 24 hours||€10,000 - €10 million||MRR of €10,000|
|ArK Kapital||Stockholm||< 336 hours||€1 million - €10 million||variable|
|Bloom||London||< 24 hours||Up to £10 million||MRR of £10,000|
And so you’ll forgive the reflex action of a rolling of the eyeballs when yet another RBF funding announcement landed on my desk. That is, until I took a look at the differentiator.
With Ark Kapital being the only exception that immediately comes to mind, the rest of these “founder-friendly” lenders seem to be reading from the same playbook. Practically verbatim, offering a non-dilutive, advance on future revenues, we just want to look at your books first and run it by our AI to ascertain a risk assessment, loan.
As the field grows increasingly crowded, we're now beginning to see variations to the script, with Bloom's play promising, "a flexible pricing and deployment model that combines the best features of a revolving credit product, charging customers for only what they use with the predictability and transparency of cost that comes with fixed fee revenue-based lending."
Riiiiight. Let me rephrase that, Bloom offers a differentiated pricing model and a “pay-as-you-go” feature set.
CEO James Hickson further explains the thought process behind Bloom, “We estimate that e-commerce merchants have incurred £125-£200 million in excess fees based on the current pricing status quo. That’s money that could have been used for more stock, increased ad spend, or customer incentives. We saw an opportunity to innovate rather than simply join the herd. So we did.”
Credo’s Christopher Dailey added, “Demand for e-commerce lending has expanded in Europe. We wanted to make an investment in a platform that was moving the product forward and combined all of the great technology and analytics you expect with a really differentiated product and approach."