After originating in the United States, the Revenue Based Financing (RBF), income-based financing, is on its way to establishing itself in France. RBF is an alternative to the more traditional funding methods offered by traditional banks. Until now, companies seeking financing could take out a bank loan or a loan of honor, or obtain a grant or raise capital funds. “We’ve seen many digital companies struggling to fund themselves. They are often refused a bank loan, and VCs are often reserved for big fish.” explains Nima Karimi, CEO of Silver. “O Revenue Based Financing is a complementary solution to these financing methods”.
Silvr, leader of the RBF
Silver? Fintech, which has just raised 130 million euros, is the first French start-up to launch in this niche from 2020. more than 200 digital entrepreneurs (SaaS, e-commerce, App, marketplace, etc…) thanks to its algorithm capable of predicting the future income of its customers. “We connect all company data: Google Analytics, e-commerce CMS, billing software, bank accounts, but also advertising agencies such as Google Ads or Facebook Ads” explains Nima Karimi.
The algorithm relies on artificial intelligence to analyze the company’s current situation, deduct its future revenue and assign a score. The score obtained allows Silvr to determine whether the company is bankable or not: the financing decision process is therefore automated.
Silvr thus allows its customers to receive between 10K and 10 million euros in 24 hours. “On average, the first loan is €300,000” says Nima Karimi. These funds allow, for example, to finance your actions, your digital marketing campaigns or pre-finance monthly subscriptions to SaaS platforms. They are also non-dilutive: the company can thus retain all of its capital.
Revenue Based Financing is still a very new financing method: “When we started in 2020, the market was emerging in the United States and non-existent in Europe. Today, it is growing in the United States and emerging in Europe.” analyzes Nima Karimi.
An unprecedented partnership between the bank and Silvr
In March, Banque Populaire Rives de Paris and Silvr signed a business provider agreement. “The objective is simple: to offer our customers the Silvr offer so that they can benefit from it” explains Sophie Magné, Market Manager for Innovative Businesses.
Several reasons led the bank to start this partnership: “We want to continue to offer the best solutions to our customers. This partnership allows us to enrich our offer with a complementary solution, based on a predictive model that allows our customers to test their economic model and finance it”. adds Pierre Tastet, deputy managing director of the Banque Populaire Rives in Paris.
A partnership that brings several benefits to the bank’s technology client companies. First, the possibility of very fast financing, within 24 hours. This funding is renewable, to support businesses as and when they need it. “On average, we refinance our clients every three to four months to accommodate their growth.” says Nima Karimi.
To benefit from this funding, you must, however, meet two eligibility criteria. Silvr’s algorithm needs data in order to make its predictions. It is therefore necessary that the company has existed for at least one year and that it has already registered a turnover of €100,000.
Banks and fintech: competitors or allies?
Fintechs are startups that are shaking up banking and financial codes. As such, they are often perceived as competitors to historic players. The reality is, however, more nuanced, as shown by the partnership initiated between Banque Populaire Rives de Paris and Silvr.
“Fintechs are a source of competition and complementarityexplains Pierre Tastet. On the one hand, competition stimulates our ability to innovate. On the other hand, some startups like Silvr are far ahead in their field. Therefore, it is logical for us to rely on their technology to not fall behind in providing solutions for our customers.”. A vision shared by Nima Karimi, head of fintech: “We do not see ourselves as competitors of banks. On the contrary, we have come to offer companies an offer that is added to that of the banks”.
“In addition to our obvious complementarity in terms of funding, we had excellent contact with Nima and Grégory, the two founders of Silvr. This relationship contributed greatly to the establishment of our partnership” says Pierre Tastet. With this partnership, unprecedented for Silvr, the banking leader wants above all to support innovation. “It is important that Banque Populaire Rives de Paris surrounds itself with local actors to contribute to the development of our territory and its actors.”, concludes Sophie Magne.
Maddyness, Media Partner at Banque Populaire Rives de Paris