Drip Capital raises $175 million in equity, debt funding

Drip Capital, the digital-only cross-border trade finance platform for small and medium businesses, has raised USD 175 million in equity and debt capital to power its next phase of growth.

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Funds raised include USD 40 million in series-C investment and USD 135 million in warehouse debt facilities, the newage lender said on Thursday, adding with the latest round of fund-raising, Drip Capital has so far raised about USD 525 million in equity and debt funding.

The new funds will be used to scale its business up over the next 18 months by investing in products and technology and also to accelerate go-to-market in existing and new geographies like South Asia and Latin America, the US-based firm said.

The company also plans to launch a new trade facilitation platform to help alleviate the pain-points of small businesses while collaborating with participants across the value chain, including shipping lines, payment processors, and insurance provider.

The equity infusion was led by the San Francisco-based TI Platform along with participation from new and existing investors including Accel, Sequoia, Wing VC, Irongrey, and GC1 Holdings.

The new capital also includes a USD 100-million warehouse credit facility with Barclays Investment Bank and a USD 35 million increase in the existing facility with East West Bank, with which it has an existing tie-up.

The global trade finance gap is around USD 3 trillion and this is expected to be a USD 10 trillion market by 2026, according the company founded in 2016, which leverages technology to finance cross-border transactions, allowing small businesses to free up working capital and invest in growth.

To date, it has financed more than USD 2 billion worth of global trade transactions spanning over 80 countries. It provides access to collateral-free credit to small businesses across India, Mexico, and the US, Pushkar Mukewar, the chief executive and co-founder of Drip Capital.

Drip Capital offers digitised trade financing solutions in the US, India and Mexico by providing small and medium business clients access to working capital and currently works with over 3,500 sellers and buyers across 80 countries.

TI Platform is a venture fund founded in 2015 by Alex Bangash and Trang Nguyen and invests in ambitious entrepreneurs who are creating disruptive venture structures, and to invest directly in tomorrow's category-defining leaders and has since helped create 64 unicorns.

East West Bank is the largest bank headquartered in Southern California and has over USD61 billion in assets. Listed on the Nasdaq, it operates across 120 locations in the US and China.