Solution

Founders First is architecting the inclusive economy by combining innovative alternative growth capital with wraparound advisory programs. FFCP funds diverse-led companies with Revenue-Based Financing (RBF), an alternative growth finance model that provides patient “equity-like” capital with the non-dilutive, liquidity of debt. Through its programs and funding, FFCP targets $50K-$10M B2B, tech-enabled, service-based diverse-led companies who have the potential to scale to $10M-$50M companies, becoming engines of premium job creation in their local communities.

Product / service

FFCP is a leading funding and accelerator platform advancing an inclusive economy. We have the mission, team, and innovative model that will help us reach our target of funding 1,000+ diverse-led companies with non-dilutive capital over the next decade. 

Our high-quality and culturally competent growth programs, funded by our 501(c)3 arm, ensure that we can source companies who meet our criteria, while helping de-risk investments for our investors. We have 3 accelerator programs, based on business stage, which have served 650+ companies since our founding in 2015: Challenge ($50K-$250K revenues), Bootcamp ($250-$1M), and FastPath ($1M-$10M). We offer our portfolio companies expansion advisory support that includes a 1:1 executive coach, creation of a 3-year growth playbook, and KPI dashboard to monitor performance.

Our Revenue-Based Financing investment model offers a unique way of alternative impact investing that aligns incentives between borrowers and investors. The model works by providing a $50K-$2M investment that is paid back as a percentage of revenues (2-8% per month) up to a repayment cap (1.2-1.5x of the principal). To learn more about our Revenue-Based Financing and an illustrative example, download our E-Book: https://foundersfirstcapitalpartners.com/how-it-works-2/#anchor-form 

Projected impact

1000 diverse-led companies funded and 5000 receiving program support by 2031

Theory of change

At FFCP, we deploy flexible capital and quality advisory services to diverse-owned businesses to help them create successful mid-market companies, while advancing inclusive economies in their surrounding communities. Our growth support helps our diverse companies boost their revenues, cash flows,  raising additional financing, adding new revenue streams, and more. The impact of this is greater wealth creation for the diverse-led founders and their families, as well as the creation and retention of premium-wage jobs, who are more likely to be from disadvantaged groups. We conduct quarterly surveys of all FFCP companies who have received funding and participated in growth accelerator programs, allowing us to provide our investors with transparent, timely, and consistent impact and financial reporting.

Beneficiaries

Traction

Across our accelerator programs, we have served 650+ companies, 72% of whom have increased their revenues (by an average of $270K, as of Q3 2022). This year, we are working to boost our pipeline through customer acquisition and partnerships that will help us accelerate our deployment of capital to our targeted B2B diverse-led companies.

Example Case Study: When the COVID-19 pandemic hit, life sciences companies’ activities began to explode. Many of OnShore Technology Group’s clients, including Moderna, were in a race against time to bring new COVID therapies to market, to get their systems validated (which is what OnShore does), to get them online so that they could move their products forward. The pandemic caused a tremendous shift in OnShore’s core business. The leadership team needed guidance and growth capital to keep up with the pace. OnShore CEO Valarie King-Bailey enrolled in Founders First CDC's Bootcamp business accelerator program, followed by FastPath. This led to OnShore Technology Group being fund-ready and securing a $500,000 revenue-based financing investment. After working with Founders First, OnShore made the Inc. 5000 list in 2021 and 2022, and King-Bailey was named to Inc. Magazine's Female Founders 100 - 2022's Most Dynamic Women in Business.

Business model

Our impact investing model aligns incentives between us and our diverse entrepreneurs: when our founders succeed, we succeed. We have a muti-part revenue strategy including program revenues, loan revenues, and contracted partnership revenues. Our operations are supported by our equity investors which include Spring Point Partners (based in Philadelphia), Rockefeller Foundation, Surdna Foundation, John D. and Catherine T. MacArthur Foundation, W.K. Kellogg Foundation, Living Cities, Kauffman Foundation, Schultz Family Foundation, Pivotal Ventures (a Melinda French Gates company), Lindmor Foundation, The Impact Seat, as well as a variety of other leading high net worth individuals and institutional investors.

Market & competition

Founders First has developed an comprehensive, innovative platform intentionally delivering results for diverse-led companies, while offering a scalable solution appealing for private capital markets.

Borrowers benefit from FFCP’s Revenue-Based Financing model that offers non-dilutive, flexible financing that underwrites based on business strength, not credit scores or personal collateral tied to historical inequities. FFCP addresses its members’ business barriers head-on – uniquely with support from its nonprofit arm – with high-quality accelerators, financial tools, and advisory support delivered by diverse real-world entrepreneurs, helping grow companies while de-risking investments.

Investors benefit from a unique asset class with returns comparable to alternative bonds, paid quarterly which offer frequent cash flows than decade-long private funds. 100% of capital raised is deployed to small businesses, with no management fees. Investors get access to quarterly impact reports, while joining a community of leaders helping catalyze an inclusive economy.

Vision & strategy

Founders First vision for the future is an inclusive economy, where all entrepreneurs have the opportunity to thrive, regardless of background or place. Our mission is to solve racial and social economic equity gaps by educating, funding, and connecting growing businesses owned and operated by diverse founders nationwide, with offices in Philadelphia, as well as in San Diego, Chicago, Texas, and New Jersey. Our aspiration is to fund 1000+ diverse-led businesses across 10 regions outside of major capital markets by 2031.