8vdX, a tech-enabled category first venture debt marketplace for startups, set up by Ravi Chachra and Vijay Lavhale, has announced it has raised over $3 million in a Seed round from Y Combinator and other investors.
This fundraise enables 8vdX to continue being founder-friendly. In the past three months, the platform has offered $2.8 million in debt to 16 startups, including two from India.
8vdX is part of Y Combinator's (YC) winter batch of 2022, and offers venture debt to help fellow founders minimize dilution across sectors and geographies,it said in a press statement.
The platform provides founder-friendly acceleration capital with minimum dilution to startups accepted in the Y Combinator program, and supports them in achieving their Demo Day goals. As a marketplace, it also enables investors to participate in funding each batch and nurturing the growth of potential unicorns. Later, they also plan to offer venture debt to startups beyond Y Combinator.
Ravi Chachra, Co-Founder of 8vdX says, “The investors in this round includes some amazing venture funds such as GMO Venture Partners (RazorPay, Drip Capital, MobiKwik, Treasury Prime, InstaMojo), Zillionize (Cruise, Boom, Rippling), Cathexis, Grant Park, Asymmetry Ventures, Earlsfield Capital Partners, and Fox Ventures. The round also saw participation from super angels Vikram Chachra (Slice, M2P, CarWale) and Kevin Moore (Drip, RobinHood, ZoomCar).
"Over the next 18 months, we will complete the build out of the technology platform, provide acceleration capital to 250 startups and have an AUM of $75mn. We launched 8vdX with an aim to provide venture debt to startups across all sectors and geographies.
"In just three months, we have an AUM of $5 million and are growing 25 percent per week. By providing venture debt, we complement the Seed round of early-stage startups, with minimal dilution of equity for the founders. We have garnered strong interest from institutional investors who want to get exposure to debt of high growth tech companies. In addition, we plan to set up an India-specific alternative investment fund (AIF) that may invest in startups outside of Y Combinator."
Venture debt from 8vdX comes with equity kickers. The company expects principal amounts to get repaid within short periods of time and equity kickers to generate upside over longer time horizons. This offers investors a combination of debt-like downside protection and equity-like upside. The company is starting with a focus on the YC ecosystem. This will enable investors to get early access to sought after and hard-to get-in opportunities, it added.