Financial Structuring Mandate for a SaaS Fundraising Process
Financial and strategic structuring advisory supporting a SaaS company in preparation for a capital fundraising
Description of the mandate: fundraising structuring for a Swiss IP SaaS publisher
The engagement focused on the preparation of an equity fundraising for a Swiss IT player offering a SaaS platform dedicated to intellectual property management and valuation. The financial structuring aimed to finance the company's growth and the development of new software functionalities, with an objective of consistency between strategy, projected valuation and investor documentation.
The transaction took place in a context of strong expansion of the digital IP market, with intensifying equity financing needs for technology companies.
Key challenges: structuring a SaaS fundraising process suited to technology investors
The main challenges of the mandate were:
- formalising a fundraising process suited to the SaaS profile (growth, recurrence, R&D);
- defining the relevant KPIs for technology investors (ARR, NRR, CAC, churn, churn rate);
- preparing the strategic and financial documentation (executive summary, teaser, business plan, term sheet template, IM);
- anticipating institutional investor requirements on capital structuring and governance.
Approach and outcomes: full process management from documentation to execution
The engagement enabled:
- to structure the entire fundraising process, from documentation preparation through to execution timetable;
- modelling several financing scenarios at different levels of valuation and dilution;
- standardising information materials to ensure consistent messaging to investors;
- preparing the term sheet grid integrating standard SaaS sector clauses (liquidation preference, anti-dilution, tag-along/drag-along);
- mapping target investors (IP-tech specialised VCs, growth funds, family offices).
The mandate strengthened the project's credibility, smoothed exchanges with investors and accelerated the implementation of the fundraising process under optimal conditions.
Illustrative example: numerical application to a Series A for a growing B2B SaaS
For illustrative purposes only — unrelated to the actual data of the mandate — a Series A for a B2B SaaS with ARR of CHF 3M, growth of 80%, NRR of 115% and burn of CHF 1.5M/year could target a round of CHF 8-15M on a pre-money valuation of CHF 25-50M (8.0x to 16.0x ARR multiples). Average dilution stands between 20% and 30% for founders, with an option pool of 10-15% constituted pre-money. The term sheet typically structures a 1x non-participating liquidation preference + proportional governance rights.
Summary: 6-month mandate, complete structuring, accelerated fundraising process
Financial structuring mandate delivered over 6 months for a Swiss IP SaaS publisher. Complete pipeline: business plan, SaaS KPIs, dilution scenarios, term sheet, IM, investor mapping. Deliverable: structured fundraising process, consistent documentation and controlled execution timetable.
Frequently asked questions: SaaS valuation, key KPIs, dilution and term sheet
How is a B2B SaaS valued in Series A?
The valuation of a SaaS in Series A relies mainly on (i) ARR multiples (5.0x to 20.0x depending on growth and NRR), (ii) benchmarking against recent rounds of comparable SaaS, (iii) DCF with growth assumptions and terminal margin, (iv) Venture Capital method (exit value at 5-7 years, target IRR 25-35%). To go further: SaaS valuation.
What investor KPIs for a SaaS?
Key KPIs for a SaaS are (i) ARR and YoY growth (>50% in Series A, >40% in Series B), (ii) NRR (>110% = best-in-class), (iii) CAC payback (<18 months), (iv) LTV/CAC (>3), (v) Rule of 40 (growth + EBITDA margin > 40%), (vi) gross margin (>70%).
What critical clauses in a SaaS term sheet?
The critical clauses are (i) liquidation preference (1x non-participating standard), (ii) anti-dilution (broad-based weighted average standard), (iii) governance (board composition, veto rights), (iv) tag-along/drag-along, (v) option pool (typically 10-15% pre-money).
How long does a Series A fundraising take?
The standard duration is 5 to 9 months from kick-off to closing, integrating documentation preparation (1-2 months), roadshows and investor meetings (2-3 months), due diligence and negotiation (1-2 months), legal documentation and closing (1-2 months). The mandate described was completed in 6 months.
How to manage founder dilution?
Founder dilution is managed via (i) the choice of amount raised (raise just what is necessary), (ii) the negotiated valuation (prioritise sustainable vs extreme valuation), (iii) timing (raise when traction maximises valuation), (iv) structuring in multiple rounds rather than a mega-round.
What investors to target for an IP fintech in Switzerland?
For an IP-tech fintech / SaaS in Switzerland, relevant investors are (i) deeptech/IP specialised VCs (Lakestar, Redalpine, BTOV, Headline), (ii) corporate VCs of banks and IP offices, (iii) family offices with tech appetite, (iv) European growth funds for rounds >CHF 15M.
Similar mandates: other structurings and fundraisings
The transactions shown include those completed by, or with the involvement of, Hectelion team members in current or previous professional roles. They are presented for illustrative purposes only and do not imply exclusive responsibility by Hectelion.
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The transactions presented were carried out by, with the contribution of, or with the participation of members of the Hectelion team in the context of functions performed currently or previously.