Tangible, a London-based financial technology startup specializing in debt finance management, has successfully raised $4.3 million in a recent seed funding round. The funding was spearheaded by Pale Blue Dot, a venture capital firm, with additional contributions from various investors including MMC, Future Positive Capital, Unruly, SDAC, Prototype Capital, and Aperture. This funding boost underscores the continued interest and investment in fintech solutions aimed at improving the efficiency of debt finance management for companies operating in sectors like robotics, climate tech, and data centers.
Why Do “Hardtech” Companies Struggle to Secure Debt Financing?
Hardtech companies often find themselves challenged by traditional venture capital models, which are typically tailored to software and less capital-intensive sectors. These companies require a specialized approach to finance that integrates both debt and equity. According to Tangible, many hardtech startups struggle to access scalable debt solutions until they reach a more mature stage of development. Tangible aims to bridge this gap by providing a platform that simplifies the process of securing asset-backed financing.
What Role Does Technology Play in Debt Management?
Technology, particularly artificial intelligence, plays a crucial role in Tangible’s approach to enhancing debt management. The startup’s AI-driven platform is designed to standardize data, documentation, and the ongoing reporting that lenders require. This technological integration is intended to streamline processes, reducing underwriting time and costs for lenders. Additionally, it allows founders to manage structured finance facilities efficiently without needing to establish specialized internal teams.
Comparatively, Tangible’s model presents an alternative to traditional lending processes, which often involve lengthy and manual coordination. The reliance on AI to automate document standardization and reporting has the potential to make asset-backed financing more accessible and less cumbersome for hardtech firms. This approach seeks to address the inefficiencies faced by institutional lenders in current legacy systems.
In discussing the implications of this funding and the innovations at Tangible, CEO William Godfrey emphasized the need for modern financial infrastructure.
“As hardtech companies scale at speed, investors need modern infrastructure to deploy capital just as fast,” Godfrey stated. “This is the exact problem we’re trying to solve with Tangible – we provide the financial infrastructure that makes hardtech easy to diligence for institutional credit to allow companies to raise asset-backed financing faster, and with less friction.”
The new funds will be primarily allocated for expanding Tangible’s workforce and creating additional products aimed at supporting its target industries further. The company’s current staff totals 13 employees, and this expansion seeks to bolster their capabilities in delivering innovative financial solutions tailored to hardtech’s unique requirements.
Tangible’s initiative to streamline debt financing will potentially allow startups to grow without being burdened by the complexities of traditional financial systems. Simplifying asset-backed financing could provide these companies with the resources needed for rapid scaling.
Fundraising success for Tangible highlights a broader trend within fintech, where technological advances in AI and data management are reshaping how finance solutions are structured and delivered. Such advancements are paving the way for greater efficiency and broader access to necessary financial resources, particularly for sectors that do not fit the traditional venture capital molds.
