With operating costs at an all-time low, easy access to global markets, and the emergence of new technologies, the number of small fast-growing companies is rapidly increasing and investing in early-stage companies is becoming more advantageous than ever.
How does Corl fund startups?
Companies that meet our strict funding requirements are financed through a revenue-sharing arrangement. Companies receive upfront capital in exchange for a percentage of future monthly revenue until a pre-determined repayment amount is met that represents 1-2x the principal amount.
How does Corl accept businesses to fund?
While most lenders focus on an owner’s credit history and static financial information made available at the time of application, Corl relies on dynamic financial information and alternative sources of data, ranging from accounting to social analytics. This data is mined, analyzed, and modelled to determine the creditworthiness and growth potential of the companies. The overall objective of this process is to maximally leverage data to measure the credit and investment risk of companies that have requested funding.
All pre-approved applicants will be subject to a stringent due diligence and review process prior to any commitment of funds. This involves a qualitative risk assessment, which includes an investigative analysis on the founders, company structure, business plan, financial projections, market, and product. Together, the quantitative and qualitative risk assessment establishes whether a company is approved for funding. Risk-based pricing is used to determine the contractual terms of the investment, such as the Principal Amount, Revenue Rate, and Repayment Cap. Read more on what businesses need to qualify for funding here.
What happens if a business fails?
As with any method of investment (banks, angel investors, VCs), investing in a startup comes with risk. Corl uses data and financial models to make better investment decisions. This gives us an edge over traditional venture capital. It also allows us to identify high value companies from a financial, product, market, and team standpoint at a faster cadence. Additionally, Corl can forecast a company's revenue based on their existing customer and sales, and we use risk-based pricing to ensure that the investment is properly priced in relation to risk. We expect 11% of companies to default on an annual basis, but the returns of those that succeed are expected to significantly overcompensate for defaults that may occur in the portfolio.