Many startups in Southeast Asia face difficulties when trying to raise early-stage funding. Although they may not wish to sell their equity, many struggle to obtain working capital loans from traditional financial institutions. Jenfi, based in Singapore, offers revenue-based financing up to $500,000 and flexible repayment plans. Jeffrey Liu is the co-founder of Jenfi.
While revenue-based financing is gaining traction in many other markets, Liu told TechCrunch that Singapore-based Jenfi is the first company of its kind focused on Southeast Asia. Monk’s Hill Ventures led the Series A funding for this startup, which was raised today at $6.3 million. Participating were Korea Investment Partners, Golden Equator Capital and 8VC as well as Taurus Ventures, ICU Ventures, Taurus Ventures, and ICU Ventures. The company previously raised $25 million in debt financing from San Francisco-based Arc Labs.
Jenfi works mostly with digital-native companies. This includes SaaS providers as well as e-commerce vendors. Its clients include Tier One Entertainment and Pay With Split. Jenfi doesn’t disclose how much of non-dilutive financing has it provided, although its goal to deploy $15,000,000 by July 2022 is not yet achieved. Jenfi claims the average customer has experienced compounded sales growth rates of 26.5% in three months, 60 percent over six months, and 156% over 12 months.
The aggregate sales of companies in its portfolio is currently more than $30 million, and Jenfi expects that the capital it has already deployed will help them generate $47 million in sales, or a 156% increase by July 2021.
Liu launched Jenfi with Justin Louie in 2019, after seeing how traditional financial institutions were lagging behind Southeast Asia’s digital boom. The two previously founded GuavaPass, the fitness studio membership platform that was acquired by ClassPass in 2019. Jenfi’s creation was motivated by some of the challenges Liu and Louie faced while financing a high-growth startup focused on Asian markets.
Jenfi is an online application system. In some cases companies can receive financing within 24 hours. However, it usually takes several days. It is a significant advantage over conventional working capital loans and private equity financing which may take several months. This makes it easier for businesses to quickly respond to opportunities to grow their revenue. For example, an e-commerce company may need quick working capital to purchase more inventory if it suddenly gets a lot of demand for a certain product.
Jenfi’s Series A funds will be used for further integrations to its proprietary risk assessment engine. This analyzes companies’ growth spending and provides insight into how they use it. Currently, it can tap into information from bank accounts; software like Xero or Quickbooks; payment gateways including Stripe and Braintree; e-commerce platforms like Shopify, Shopee and Lazada; and Facebook Ads and Google Ads.
Jenfi offers companies flexible repayment options and charges a flat fee. This is based on how much financing was received and the monthly sales. It also calculates the time it will take for the loan to be paid back. Jenfi continues analyzing the data sources provided by companies, so it can tell if a client potentially needs more capital or an adjustment to their repayment terms.
Jenfi plans to provide business tools and financing, as well as financial services. “We see ourselves as partners in our portfolio companies’ growth,” said Liu.
Jenfi can access a variety of data sources, including bank accounts and accounting software, to help it identify potential opportunities. Automated analytics will receive part of Jenfi’s Series A funding. For example, the platform would be able to identify an advertising opportunity with high ROI on Google Ads and notify the company, asking if they want to apply for more capital to finance the campaign.
Publiated at Tue 17 August 2021, 02:01:04 (+0000).