Rethinking Fundraising Could Be the Key To Retaining Talent During Tough Times

It’s hard to exaggerate how important a talented, committed, and motivated workforce is to a SaaS company’s success. And at the moment, that’s a problem. 

Cash is King for SaaS now, more than ever

With startup investment dwindling, some SaaS companies, even the high growth ones, are so concerned that they’re laying off workers. Many are implementing hiring freezes, or struggling to make the competitive offers required to hire the talent they need in order to keep on growing.

Raising the growth capital needed to retain and recruit star workers is proving tough, and SaaS brands are rightfully wary of trading away equity on unfavorable terms in order to generate money for payroll. 

What happens now? 

One smart option is to leverage your fintech companies to gain access to non-dilutive forms of capital. With advances in payment technology, today’s fintech vendors can analyze SaaS brands’ portfolio of customer contracts, gleaning insights into subscription longevity, reliability, and performance. 

Armed with this rich data and insights into recurring revenues, it’s possible to provide quick, flexible access to capital by delivering advances on contracts and revenue streams that are already locked in. 

The ideal solution is where you can have your cake and eat it too - i.e. pass the cost of this financing on to your customers at the time of close. Even better,  embed this into your sales process and it becomes a constant source of funding.

Agility is key

That provides companies with the agility to invest in talent on an as-needed basis, without turning to cumbersome equity or debt financing arrangements. Rather than waiting weeks or months for the money to be made available — as is often the case with conventional investment channels — cash is accessible within days, helping ensure employees are paid in full and on time. 

It also makes it possible to keep your cap table intact — and keep more equity available for compensating employees or enticing star players to join your team. Instead of hitting pause on their recruitment efforts, or even beginning layoffs, companies can flexibly leverage their revenue streams to keep cash flowing and lock in the talent they need to grow.

Beyond the status quo

In the crowded SaaS marketplace, survival isn’t about maintaining the status quo. It’s about finding a path forward. 

That’s especially important when it comes to hiring and retaining talent — so look beyond traditional funding channels, and start asking how your fintech stack can drive non-dilutive cash flow, and help you keep hold of your top talent as you find your path through these turbulent times.

Want to learn more? 

Reach out to Ratio today, and learn how access to non-dilutive, fintech-enabled capital can help keep your business on the path to growth.

Tags:
Finance
published on
August 17, 2023
Author
Ashish Srimal
Co-founder & CEO at Ratio
Ashish Srimal is a SaaS entrepreneur and executive who has built SaaS startups and led large SaaS businesses.
SEE MORE CONTENT
Related Posts
Finance

Pros and Cons of Venture Capital: Is it Right for Your Startup?

Venture Capital (V.C.) in the U.S. continues to surge in 2023, with projections nearing $70 billion. This presents a prime opportunity for early-stage ventures aiming to scale and thrive.However, the landscape is fraught with challenges. Less than 1% of small U.S. businesses manage to secure V.C. backing, and 25% are still looking for additional funds. For entrepreneurs, it's a path of both opportunities and obstacles.

Ratio Team
September 20, 2023
Finance
Trading

Exploring Pipe Competitors and Alternatives: An In-Depth Analysis

In this post, we'll break down top-notch competitors to Pipe, including Ratio, Founderpath, and Liberis. From standout features to pricing, we've got you covered.

Ratio Team
August 25, 2023
Finance

Managing Core SaaS Metrics is Getting Harder: Here’s the Solution

The days of rudimentary monthly cash flow and profit / loss calculations are long gone, with recurring revenue, customer acquisition costs, churn rates, and other SaaS-specific financial metrics now the basis of make-or-break strategic decisions.

Ashish Srimal
August 14, 2023