Hyderabad based Nowfloats which helps small businesses to build an online presence has raised ?14.36 Cr funding. The funding round appears to be a bridge round from existing investors, Omidyar Network, Iron Pillar Capital & others.
As per the regulatory filing, Nowfloats had also secured 10 crore loan from Blacksoil Capital and its received the first part of the amount, which is 5 crores.
The funding will use to run the current operation. The funding is based on debt funding, where Nowfloats Technologies Private Limited allotted 14,35,594 debentures at ?100/- each on March 7, 2018.
Founded by Neeraj Sabharwal, Nitin Jain, Ronak Samantray, and Jasminder Gulati, NowFloats has so far raised ?83.8 Cr from investors including Omidyar Network, IIFL, Faktory Ventures, Blume Ventures, Mumbai Angels, and Hyderabad Angels.
NowFloats a business discovery services platform helps SMEs create and manage their online website by SEO optimization on its own platform.
As per the company report in 2016, there are 50M Small & Medium Businesses in India, while there are only 700K registered websites. It is estimated that almost 10M Indian businesses need an online identity. With 900M+ mobile phones and SMS being the pervasive technology, NowFloats believes that getting business online through SMS (or APPs) is a scalable and sustainable business.
The startup has reported revenue of ?2.49Cr against total expenses of ?41.80 Cr in FY 2017.
What is Bridge funding or loan?
A bridge loan is a type of short-term loan, typically taken out for a period of 2 weeks to 3 years pending the arrangement of larger or longer-term financing.
Also, bridging loans can be used by a business to ensure continued smooth operation during a time when for example one senior partner wishes to leave whilst another wishes to continue the business. The bridging loan could be made based on the value of the company premises allowing funds to be raised via other sources, for example, a management buy in.