Revenue-based financing firm Efficient Capital Labs raises $7M from QED Investors

Fintech company Efficient Capital Labs (ECL) has raised $7 million in Pre-Series A round led by QED Investors.

The US-headquartered company provides non-dilutive capital to B2B SaaS firms operating in the South Asia-US corridor.

Existing investors, such as 645 Ventures, The Fund, Lorimer Ventures, Riverside Ventures also participated, while Generalist came in alongside QED as a new investor. 

ECL will use the capital towards automation, and team expansion across engineering, product, underwriting, sales, and operations, according to a press release.

Including the fresh capital, the fintech company has so far raised $110.5 million, which includes a $100 million debt facility. ECL raised an equity round in April last year led by 645 Ventures. 

Founded in 2022 by Kaustav Das and Manish Arora, ECL provides B2B SaaS companies a percentage of their ARR as upfront non-dilutive capital.

ECL, which is currently focused on US-India and US-Singapore, says it funds customers via its balance sheet. This means that customers get access to capital at a cheaper cost and can avoid the uncertainty that comes with depending on third-party investors or marketplace dynamics to receive capital against revenue, according to the press release.

“Our vision is to enable border-agnostic access to capital for businesses in emerging markets, such as India, that can benefit from lower capital costs that are available in markets such as the US,” Das said. 

Since starting its lending operations in June 2022, ECL claims to have provided capital to over 50 SaaS businesses. It aims to add over 150 customers before the end of 2023.

“Indian SaaS companies are known for innovative and specialist software solutions, and their growth in selling to the U.S. represents a new era of entrepreneurship and global collaboration,” said QED Investors Partner and Head of Asia, Sandeep Patil.