Will Sting invest in our startup?
All companies accepted to Sting Accelerate receive an investment of SEK 400 000 through a convertible note from Propel Capital, the investment company linked to Sting.
All companies accepted to Sting Incubate have the possibility to receive the same investment of SEK 400 000 from Propel Capital. The opportunity will be available after a few months in the program.
Are there other benefits to having Propel Capital as a financier, in addition to the investment itself?
Yes! The co-owners of Propel Capital are business angels who are actively looking for investment opportunities in exciting promising startups. In other words, as a portfolio company to Propel Capital, you are exposed to a large number of potential investors in your company.
Some of the investors in Propel Capital (“SIA angels”) have so-called co-investment agreements with Saminvest. This means that a direct investment in a Propel Capital company by a SIA angel is matched by Saminvest with an equal amount.
How much ownership does Propel Capital take?
Propel Capital invests via a convertible note that converts to ownership only when the company has raised at least SEK 1 million or more from external investors. This way, we avoid setting a valuation of the company too early.
What are the terms of the Propel Capital convertible?
For full terms and conditions, please contact firstname.lastname@example.org. Here is an overall summary of the terms:
- The loan of SEK 400,000 falls due for payment after three years to the extent that conversion has not taken place before.
- The loan has an annual interest rate of 6%.
- Propel Capital has the right (but not the obligation) to convert when the company has made a new issue/s to investors for a total amount of at least SEK 1 million in external capital.
- Conversion price: 70% of the new issue price, but not higher than what corresponds to a valuation of all shares in the company of 20 million before conversion.
How is the number of shares that Propel Capital receives after conversion calculated?
The loan calculated with interest at the date of conversion / price per share in the round * 0.7
Does Propel Capital invest in its portfolio companies?
No, usually Propel Capital does not have the opportunity to participate in new issues in the portfolio companies. However, Propel Capital’s CEO is actively working to support the portfolio companies in their financing rounds in other ways, including by making intros to potential investors.