Venture debt marketplace 8vdX, set up by Ravi Chachra and Vijay Lavhale, has raised over $3 million in a seed round from Y Combinator and other investors. 8vdX is part of YC winter batch of 2022 and offers venture debt to help fellow founders minimise dilution across sectors and geographies.
The investors in this round include venture funds like GMO Venture Partners, Zillionize, Cathexis, Grant Park, and Asymmetry Ventures, among others. The round also saw angels Vikram Chachra and Kevin Moore.
Over the next 18 months, the startup aims to complete the build-out of the technology platform, provide acceleration capital to 250 startups, and have an (assets under management or AUM of $75 million, Chachra informed.
Founded in 2021, 8vdX is building a platform that provides capital access to startups when they need it most, which is prior to their equity raise. 8vdX provides acceleration capital with minimum dilution to startups accepted in the YC programme and supports them in achieving their Demo Day goals.
Chachra said, “In just three months, we have an AUM of $5 million and are growing 25% 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 the debt of high-growth tech companies. In addition, we plan to set up an India-specific alternative investment fund that may invest in startups outside of YC."
Chachra is a serial entrepreneur who has founded companies like SNAZ, a mobile wallet and universal shopping cart in 1999, and co-founded Eight Capital, an India-focused credit platform that evolved to include global investments in 2005.
8vdX expects principal amounts to get repaid within short periods of time and equity kickers, something that the firm offers, to generate upside over longer time horizons. This offers investors a combination of debt-like downside protection and equity-like upside, claims the startup. The company is starting with a focus on the YC ecosystem. Later they plan to offer venture debt to startups beyond YC.