OnShore Technology Group (OnShore) is an independent Chicago-based consultancy founded in 2004 specializing in Independent Validation and Verification (IV&V) software services and solutions for the life science industry.
Why a Revenue-Based Loan?
Founder & CEO Valarie King-Bailey wanted to take the company from a core service-based business to a tech-enabled, service-based business. She had taken on small amounts of traditional debt, like a bank line of credit and MCA, but needed a better financing solution to help the company grow.
King-Bailey joined the 2020 May FastPath cohort at Founders First. Her company received a $250K revenue-based loan from Founders First in September 2020, along with a co-investment from revenue-based lender Novel Capital, and leveraged that investment to raise another $250K follow-on investment from Founders First in July 2021. The $500K in growth capital enabled her to add five new team members, expand marketing, and increase annual revenue by 53% to $3.8M. Additionally, OnShore was able to expand her team and build her own proprietary technology platform. The revenue-based funding unlocked meaningful growth for the company and King-Bailey did not have to give up any of her ownership.
Founders First still provides post-funding advisory support as the company continues to scale to $10M+ in annual revenue.
Deal Terms & Performance
As of Q3 2021, OnShore has consistently made monthly revenue-based payments to Founders First post-investment and paid nearly 25% of the return cap or loan obligation. The revenue-based payments have exceeded expectations based on the 1.43x return cap ($715K total obligation).