An oversubscribed first fund for Novel Growth Partners will help the Kansas City-based financing firm expand its tech investments in Chicago, Indianapolis and St. Louis.
With more than $12 million banked for the fund, Novel is poised to use its unique revenue-based financing model to focus on boosting B2B software startups, the firm said in a press release Tuesday.
“We’re able to provide investment in a more expeditious fashion due to the fact that we don’t need to negotiate the company’s valuation, organize a syndicate, or wait for the lead investor,” said Keith Harrington, Novel Growth Partners co-founder. “While we do operate as a standalone investor, we also partner with traditional investors, such as venture capital firms, to provide best-fit financing, tailored to where each company may be in its unique, business journey.”
Founded in 2018, Novel already has invested in such Kansas City startups as Rack Performance, MyMajors and DivvyHQ, and built a significant portfolio across the Midwest. Companies range in industry from education and marketing to real estate and sports performance analytics.
Click here to see Novel Growth Partners’ portfolio.
The firm provides companies up to $1 million in growth capital and leverages the operational expertise of its founders and partners to provide tactical sales and marketing support to entrepreneurs via its proprietary Growth Bootcamp. Unlike other growth capital, Novel does not take equity or require personal guarantees.
It’s a strategy that allows the firm versatility in its investments, said co-founder Carlos Antequera, pursuing software companies with varied fundraising legacies, from bootstrapped companies to those with venture capital backing.
“While early stage technology companies have traditionally viewed venture capital or bootstrapping as the only avenue for financing, we provide another viable option,” he said. “There are many B2B SaaS businesses that could be thriving if they focused more on revenue growth over devoting all their energy to raising another round of funding.”
Click here to read about Novel Growth Partners’ recent innovative deal with Flyover Capital.
Antequera formerly was CEO of exited software firm Netchemia, while Harrington is a longtime venture capitalist — providing Novel with a wealth of experience and expertise, Antequera said.
“The early-stage B2B software market requires alternatives to capital access, but capital investment is not enough to succeed,” he said. “Because of our entrepreneurial background and operational expertise, we look at investing differently at Novel. We’re aligned with the entrepreneur from Day 1. We want to help them build a company that generates revenue efficiently and consistently. Our growth bootcamp provides invaluable insights to improve their sales processes. We believe that increases the value of their company and the likelihood that we will have a successful investment.”