Arc’s idea is to approch startups with a new way to raise capital, one that lets them keep more control over their own companies. Arc says that it offers a premium non-dilutive and non-debt funding alternative for startups, along with financial tools to scale faster on their term.
This service is especially important for Israel Startup Nation these days. New investments are hard to come by due to the ongoing worldwide financial crisis and high inflation. Many Israeli companies have been forced to lay off employees recently.
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Founded in 2021, Arc provides startups with the financial products that it says the startups deserve. Arc converts startups’ future revenue into upfront capital, provides a cash management account to store, manage and spend funds, and delivers financial analytics to drive growth. The company is based in San Francisco and is funded by Left Lane Capital, NFX, Bain Capital Ventures, Clocktower Technology Ventures, Torch Capital, and Y Combinator, among others.
“We are building the #1 digital bank for software startups,” said Don Muir, Co-Founder and CEO of Arc. “For the first time, startups can tap into their future revenue to access capital without dilution, deposit those funds into an FDIC-eligible account, and leverage proprietary finance software to optimize growth. We’re thrilled to join forces with this talented group of investors who bring relevant experience transforming fintech and SaaS startups into market-leading platforms. This capital injection will help us build and scale Arc Treasury to meet the digital banking needs of a new generation of software-driven businesses.”
Arc converts future revenue into upfront capital, meaning that pre-revenue companies are unfortunately ineligible.
Arc primarily serves software / SaaS and tech-enabled businesses with highly predictable revenue streams.
Customers are currently required to have a U.S. bank account and headquarters as well as be incorporated in the U.S.
This is true for many Israeli startups.