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Fundamentals
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Arthur Fox, a Senior Advisor at Cypress Growth Capital, pioneered royalty financing
as a form of venture capital in 1992. Royalty financing is increasingly considered
an attractive alternative
for funding emerging and expansion stage companies. Cypress Growth Capital is one
of the first and largest providers of royalty financing in the United States.
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Royalty financing provides growth capital in exchange for a fixed percentage of
a company’s future revenue (a “royalty”). The company pays the
royalty monthly until its total payments reach a cap, expressed as a multiple of
the investment amount.
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Benefits of Royalty Financing
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Royalty financing from Cypress Growth Capital provides entrepreneurs with an attractive
new financing alternative:
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No fixed or minimum payment requirements: monthly payments flex with the growth
(or contraction) of the business
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Preserves ownership; because royalty financing is a form of debt, there is no significant
equity dilution, nor is there a time-consuming and possibly contentious valuation
process
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We never require a personal guarantee
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Allows a company to secure significantly larger amounts of growth capital than
would typically be available from other debt sources
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Investment success is not dependent on the sale of the business or other liquidity event
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If royalty financing is attractive to you, see if your
company fits within our investment criteria.
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