1440 raised $500,000 through revenue-based financing instead of VC or debt, paying 5% of revenue until the investor hit a 3× return. The company had 10-20k subscribers when it took the deal, validating unit economics first. It's now highly profitable with several million in annual revenue.
1440 is huge and it's profitable from what I understand.
Yep. Very profitable.
Several million dollars is what I think I'd read in, uh, Adweek.
Yep. Very. Yep. Very, very much so. No outside funding. So we did take a little bit of revenue-based financing and kind of like debt-like features early on. If you're a fan of Shark Tank, you know how Mr. Wonderful is always like those royalty deals he talks about? Uh-huh. We basically took like an equivalent of that. It was $500,000. And basically at the time, I think we had something like 10,000, 20,000 subscribers, but we can figure out our unit economics. We could see them already working. So yeah, we raised $500,000 and we paid back 5% of our revenues until the investor got 3x return on their capital. Wow. And then they, and then they got like a slight little equity kicker as well in case, like for Schmuck Insurance, like if we are worth hundreds of millions of dollars, it's not like a piece of debt where you have a guaranteed payment.
It was based on as a percent of your revenues, which is really nice too. Wow.
