The CEO of Choco Up on why he views revenue-based financing as a new but potential marker of a business's robustness

In five words, how do you explain your role at Choco Up to a new acquaintance?

Helping businesses grow and scale.

What do people misunderstand most about your work within the fintech industry?

Sometimes, there is a common perception that we are simply a lending institution. While offering capital is essential, it's just a tiny part of what we do. We love working with business founders to help them use their funding most effectively to achieve their growth goals. We specialise in guiding individuals through the ups and downs of running a business, helping them overcome obstacles and reach success.

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Could you explain how Choco Up's revenue-based financing (RBF) approach differs from traditional funding models?

As businesses grow, they often face challenges and uncertainties that can impact their cash flow — we're here to help them out. Our RBF approach gives businesses the funds they need to expand while giving them flexibility in repayment, especially during leaner months. Additionally, we offer a value-added service that analyses the business matrix to ensure our clients receive the best possible guidance. 

How has RBF impacted the growth trajectories and operational strategies of businesses? 

Revenue-based financing has been transformative, as evidenced by Choco Up’s clients like Cheak and BuzzAR thriving even during the pandemic, leading to Cheak's acquisition by Love Bonito. This highlights its role as a crucial support for businesses in navigating challenges and enhancing acquisition appeal. On the other hand, BuzzAR, under Bell Beh, overcame fundraising hurdles, especially as a female entrepreneur, through Choco Up's revenue-based financing.

With plans to expand in Saudi Arabia, BuzzAR has secured projects over US$10 million ($13.45 million), marking its significance in tourism tech. 

These heartwarming success stories highlight how revenue-based financing can be an effective and dynamic tool, fostering growth and innovation while addressing specific business challenges.

How do you foster innovation and agility at Choco Up, adapting your leadership to the specific needs of the fintech sector?

Having a reliable team that I trust completely and allowing them to be creative is critical for achieving success — I'm not one to micromanage my team. For us to bring our company's vision to life, it's vital to share it with every team member and make them see themselves as an essential part of it. Communication is also a crucial aspect of team management. Keeping communication channels open and finding innovative ways to bridge communication gaps is key. 

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What's your top advice for entrepreneurs seeking funding and mentorship to attract investment from firms like Choco Up?

Businesses should be aware of the tangible and intangible qualities that can make them attractive candidates for receiving funding and mentorship. With tangible factors, presenting a clear and sound business model with a promising growth trajectory and a well-crafted plan is important. It doesn't have to be perfect, but should demonstrate thoughtfulness and careful planning.

Additionally, intangible qualities such as trust and integrity are essential from the perspective of investors and mentors. Building strong, long-term relationships is crucial for success, and this requires a commitment to honesty, transparency, and hard work on the part of the business owners. By cultivating these qualities, businesses can significantly increase their chances of finding the support they need to succeed.

How do you see revenue-based financing changing in the startup ecosystem?

This type of financing enables founders to balance their resources responsibly to achieve their business objectives and financial obligations to investors without compromising their vision and goals. It also helps avoid cutting corners just to hit revenue targets.

Over time, access to RBF is expected to become even more accessible, with better business growth predictions. This type of financing could become an indicator of the robustness of a business, enabling it to demonstrate its ability to generate consistent revenue streams and achieve sustainable growth. As businesses and investors engage in more sophisticated conversations and relationships, RBF will likely play an increasingly significant role in the startup ecosystem.