BidPal: Building a Bridge to the Future
BidPal improves charitable fundraising by helping nonprofits use technology to more efficiently run their events from start to finish. BidPal’s event management solutions, automated mobile auctions, payment processing, online fundraising, and consulting services help make charitable events more fun and more profitable.
Since 2008 BidPal has helped nonprofits across the country feed the hungry; fight cancer; promote the arts; educate young people; and everything in between.
BidPal is firmly committed to helping nonprofits use technology to more efficiently run their charitable events. By releasing new features and services several times a year, BidPal continuously improves charitable fundraising.
Technology drives the need for fast financing
BidPal, like many growing technology-focused companies, needed access to cash for research and development. At the same time, BidPal was not ready to take on another traditional round of fundraising, which can be time consuming. Technology moves quickly, and BidPal needed a method for raising cash that could keep up.
Ice Miller presented BidPal with a method that could keep pace: bridge financing. In an industry where technical innovations can put years of development between the capabilities of one company and its competition, the team at Ice Miller knew that bridge financing could help BidPal raise the cash it needed without sacrificing the critical element of speed.
The Ice Miller team worked closely with BidPal to set up the bridge financing structure. Under this system, BidPal worked with existing investors and employees to invest in future equity in the company. The bridge allowed the company to then value the equity at a predetermined point in time. Meanwhile, BidPal stakeholders, including key employees, now have an even greater interest in the success of the company.
How can technology-focused companies benefit from bridge financing?
Bridge financing offers many benefits to technology-focused companies who need to keep up with the demands of their industries. A bridge can serve as a connection between a market-driven need for innovation and the next traditional fundraising round. It can also be a less expensive vehicle for financing, and does not create a negative impact for valuation.
In addition, bridge financing allows a company to set valuation at a point in the future, often once the traditional fundraising round has had the time to run its course. Investors in the bridge are then converted into future equity financing.
A bridge financing round can also be called a "convertible note round." Newer companies with values that may not be easy to determine may use this term for their bridge, as they may be asking investors to come in through a note.
Could your technology-focused business benefit from bridge financing? For more information, contact us using the form below.