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Musings on corporate finance, fund raising, debt capital and other matters

Project Ignite

Ignite is a London based technology company that provides specialised payment solutions and high-end IT consultancy services to Tier 1 global financial institutions.

In an industry that has been and will continue to be in significant transformation, the company has become an expert in payment transformation, providing both consultancy services and an innovative product solution, which together help global banks to address the disruptive market effect of new entrants into payment technologies.

Ignite approached Altimapa for help in financing growth and product development costs. The debt raise was conducted in parallel to an equity investment. 

The challenges of this capital raise were two-fold:

  • While the historical services business of the company is profitable, much of the net cash generated from operations has been re-invested in R&D costs for the past 3 years, resulting in a low or negative consolidated EBITDA;
  • The most innovative of the company's R&D efforts have promising sales prospects and the potential to generate recurring revenues, but is still at the beginning of the sale cycle;

Altimapa responded to these challenges by carefully positioning the capital raise for an audience of growth capital lenders and by:

  • Separating the historical services business and the new product from a financial standpoint;
  • Highlighting the strategic benefits for the company to pivot towards a product led business model, with the associated potential to generate recurring revenues;
  • Articulating the commercial synergies between both business models.

Although Altimapa was mandated to raise debt capital, we nevertheless had to highlight the strategic potential of the company within a changing payment industry ecosystem and the underlying “equity story”, in order to convince lenders of the strength of the business and justify an amount of borrowing that was not easily supported by historical EBITDA levels.

Altimapa reached out to a selected number of debt providers in the growth capital space, including venture debt providers, cash flow based lenders and challenger banks. Within 6 weeks from going to market, Altimapa sourced two firm debt-only offers which resulted in attractive terms for the company. From start to finish, the project was carried out in the context of the pandemic and all meetings and due diligence were carried out remotely.

"Altimapa were very straightforward to deal with, and were able to advise on the best way to handle negotiations with the most interested lenders. In the end we received multiple termsheets with offers of the sum we wanted, on broadly the terms we had been told to expect right at the start. Pedro, Claire and the rest of the team did a great job in finding us the debt we needed to expand our business.", Chief Operating Officer

The successful sourcing of two separate and competitive offers underlines the availability of cash flow lending products for innovative companies with a robust growth plan and sound strategic positioning even in those cases where the business financial history does not initially seem to support a full debt raise.

UK-Based High Growth Fintech
£3,500,000
5-Year Term Debt
Funding organic growth and product development