ArK Kapital expands its capital pool to €400 million and expands into Germany

by James · March 30, 2023

Swedish Tech lender ArK Kapital announced today its entry into Germany. ArK Kapital gives technology companies access to up to €10 million in founder-friendly and non-dilutive funding combined with its unrivaled growth forecasting platform AIM. ArK has also secured an additional €100 million, making over €400 million of non-dilutive capital available to European tech startups, as a supplement to traditional venture capital, as they master the shift towards profitability.

With today’s launch, ArK Kapital introduces a new model for German entrepreneurs and technology companies to grow their business, offering access to non-dilutive loans and access to world-class growth forecasts via AIM Founders simply plug into ArK’s machine learning platform with all their growth related accounts and in return get access to a detailed 5-year forecast – from which they can access customized financing. ArK’s financial product suite provides access to a transformative, large growth loan ranging between €1 and €10 million, with a duration of up to seven years, with repayments not starting until two to three years, completely without dilution.

“We are excited to bring something new, plus access to more capital, to the German tech ecosystem. And given the current macro trends that are pushing founder companies to redraw their playbooks and establish a path to profitability, we believe the timing could not been better.” says Henrik Landgren, co-founder and CPTO at ArK Kapital. “Since the founding of ArK Kapital, we have seen a growing need for access to capital that is offered on the founders’ terms, with longer repayment periods, flexibility outside of traditional equity rounds and as a supplement to venture capital.”

2023 continues to see a clear decline in the flow of venture capital to the German technology market. While early seed and Series A rounds have been less affected, later-stage tech companies have seen VC investment fall by 56% year-on-year compared to 2021, the same figure for Europe as a whole is down by as much as 46% for Series C and later-stage financing, according to data from Dealroom.

In the current economic climate, the credit market has historically been closed to early stage technology companies, as banks have not been able to risk assess companies with not yet profitable growth. With ArK’s always-connected approach to underwriting, it is now possible to bridge the gap between the credit market and the start-up community – and opens the way for more companies to secure access to funding from a significantly larger pool compared to venture capital alone.

“In Germany, the concept of non-dilutive loans to extend the runway, optimize for future growth or master the transition to profitability is still quite unexploited, at least compared to markets such as the UK, a market that has historically been responsible for the disproportionate share of debt financing .”, says Mariam Koorang, managing director for Germany at ArK Kapital. “I have seen the pain points of raising capital up close, and finally there is an objective and data-driven alternative to securing access to capital. This means more German tech companies can fuel their future growth, especially between rounds.”

ArK Kapital has seen significant demand in the Nordic region for its financial products and platform for cross-border growth forecasts in record time and is planning further market expansion in 2023. The team is supported by no less than seven unicorn founders and a German banking veteran – Frank Strauß, formerly of Deutsche Bank and Deutsche Postbank Group, Hjalmar Winbladh from Epidemic Sound and founder of EQT Ventures, Jacob De Geer from IZettle, Timo Soininen from Small Giant Games, Ilkka Paananen from Supercell, Sebastian Knutsson from King, Riccardo Zacconi from King, and Steve Anavi from Qonto.