More posts by this contributorMost founders who are raising capital look first to traditional equity VCs.
But should they? Or should they look to one of the new wave of revenue-based investors?Revenue-based investing (RBI) is a new form of VC financing, distinct from the preferred equity structure most VCs use.
RBI normally requires founders to pay back their investors with a fixed percentage of revenue until they have finished providing the investor with a fixed return on capital, which they agree upon in advance.This guest post was written byDavid Teten, Venture Partner, HOF Capital.
You can follow him atteten.comand@dteten.
This is the 5th part of our series on Revenue-based investing VC that touches on:From the founders point of view, the advantages of the RBI model are: