Efficient Capital Labs, a fintech company specializing in providing non-dilutive capital to B2B SaaS companies operating in the South Asia-U.S. corridor, announced a successful $7 million Pre-Series A funding round led by QED Investors. Existing investors such as 645 Ventures, The Fund, Lorimer Ventures, Riverside Ventures, and Generalist also participated in the round, with QED joining as a new investor. This marks ECL’s second raise in less than a year, showcasing the company’s rapid growth and investor confidence.

ECL offers B2B SaaS companies a unique financing model, providing them with a percentage of their Annual Recurring Revenue (ARR) as upfront capital that is entirely non-dilutive. By funding customers through its balance sheet, ECL enables companies to access capital at a lower cost compared to traditional funding methods, without relying on external investors or marketplace dynamics.

The latest funding round, led by QED Investors, brings ECL’s total capital raised to $110.5 million, including a $100 million debt facility. This round follows a successful equity raise of $3.5 million in April of last year, led by 645 Ventures. The additional capital will be used by ECL to enhance automation, expand its team across multiple functions including engineering, product, underwriting, sales, and operations, and improve its unit economics.

Kaustav Das and Manish Arora co-founded ECL in 2022. Das brings over 20 years of experience in the industry, having served as Chief Risk Officer at various organizations including Kabbage (now part of American Express). Arora has extensive expertise in B2B SaaS, fintech, and regulatory technology, previously holding the position of General Manager, South Asia for PayJoy, a San Francisco-based B2B SaaS fintech company.

Commenting on the funding round, Das stated, “Our vision is to enable border-agnostic access to capital for businesses in emerging markets, such as India, that can benefit from lower capital costs available in markets like the U.S. Our value proposition is unmatched, and we offer the most capital- and time-efficient solution for SaaS businesses looking to raise growth capital. We are immensely grateful to our investors for putting their faith in our vision and mission. The latest fundraise allows us to continue innovating for the customers we serve.”

Since launching its lending operations in June 2022, ECL has provided funding to more than 50 SaaS businesses. The company aims to expand its customer base to over 150 before the end of 2023, demonstrating its commitment to supporting the growth and success of SaaS companies in the region.

Sandeep Patil, Partner and Head of Asia at QED Investors, expressed enthusiasm for the partnership, stating, “Indian SaaS companies are known for innovative and specialist software solutions, and their growth in selling to the U.S. represents a new era of entrepreneurship and global collaboration. By providing non-dilutive capital to these companies, ECL empowers the founders to build for the long term and drive innovation and growth. Kaustav and Manish are a formidable team. I am thrilled to partner with them, and I look forward to what the future holds.”

Aaron Holiday, Co-founder and Managing Partner at 645 Ventures, highlighted the surge in demand from SaaS companies and expressed excitement about continuing to support the vision of ECL’s founders. He added, “We are delighted that QED shares our thesis and are now our partners in this journey.”