Super G Capital provided a $1.25 million seasonal working capital loan to a SaaS- based system provider that assists K-12 educators and administrators in managing, overseeing and enhancing their students’ engagement in digital learning environments.
Due to the cyclical nature of education-based budgeting and spending in school districts, cash flow in the educational technical space is highly seasonal. Contracts are paid on an annual basis with the vast majority coming in during one quarter of the year. This leads to temporary cash shortfalls which were historically financed primarily through equity from investors.
Knowing the company was very close to attaining “escape velocity” and not wanting to further dilute equity, management sought out venture debt as an alternative financing option.
Due to the company’s solid revenue growth since inception and a completed cost restructuring during 2017, Super G was able to complete diligence and documentation to fund the loan within three weeks and solve the company’s seasonal cash shortfall.
