Frequently Asked Questions
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What is Content Finance?
Content Finance is a term used to fund entities focused on creating content. NV Capital’s model revolves around extending structured / mezzanine debt to these entities during the content creation / manufacturing process.
Benefits to Content owners?
Constant and Reliable source of capital enabling maximum exploitation across multiple platforms without diluting the potential upside. It also helps in effective monetization of content rights across the life of the product.
How does one avail funding in Gaming & Entertainment Technology startups?
Like any startup, startup entities in this space also faces challenges in availing debt funding from any bank. However, off late, various financial institutions have resorted to structured form of debt (Venture Debt) for the startup ecosystem. Venture debt is a form of debt financing for venture capital-backed companies. Venture debt is a good model for founders as it involves significantly less dilution compared to equity.
The founding team are pioneers in the field of Media & Entertainment finance and understands the financing nuances of the entire M&E ecosystem having funded in excess of 40 projects and deployed in excess of USD 100 Mn. The team has longstanding experience in building thought leadership and relationship capital in this specialized vertical and has had many success stories by partnering in the growth of multiple M&E entities. They have navigated through various industry cycles, mitigating challenging projects and delivering successful exits.
Why is it important?
There are multiple content pieces which releases across Theatrical /Broadcast / OTT platforms and has been originating from different pockets of the country. There is a dearth of financial institutions catering to this sector and hence it is imperative to have focused and structured pool of capital for content manufacturers.
What is the investment mechanism for content finance?
The investment in a project is generally done with an average time horizon of 12- 15 months. The investments are secured by way of charge over the IP and other assets. Additionally, the project cash flows from various monetization channels are completely charged and ringfenced.
What are the parameters for assessing Venture Debt to Gaming & Entertainment Technology startups?
The funding can be assessed based on multiple parameters including but not restricted to:
a) Business growth and Revenue / Market potential
b) Founder credibility and business vintage
c) Backing of a reputed Venture Capital / sponsor
d) Cash Flow accretion
e) Valuation metrics and fund raising initiatives