Lemon Launches Flexible Financing Solutions for SaaS Vendors

Lemon announced Thursday (Oct. 10) that the company has launched and that its financing platform built for software-as-a-service (SaaS) sales teams is live.

The platform is designed to help SaaS sales teams overcome the common challenge of customer hesitation over large upfront costs, Lemon Co-Founder and CEO Matt Bird said in a Thursday blog post.

“Lemon is a financing platform that empowers SaaS sales teams to close bigger deals by allowing them to offer customers flexible monthly payments for annual and multiyear plans,” Bird said in the post. “We believe software should be both accessible and affordable, not held back by daunting upfront costs.”

In addition to allowing buyers to spread the cost over multiple payments, Lemon enables sellers to get paid upfront, according to the post. When the deal is signed, Lemon pays the seller the full contract value upfront.

To do so, Lemon partners with funders who provide the financing. This approach enables the company to operate without carrying any debt burden, handle larger deal volumes without capital constraints, and remain a potential long-term partner by having less financial risk, the post said.

Lemon’s initial lending partner is Shawbrook Bank, per the post.

“This is just the beginning,” Bird said in the post. “We’re on a mission to make SaaS sales easier, faster and more profitable worldwide. With Shawbrook Bank as our first partner, we’re excited to expand our network by collaborating with specialist banks and funding institutions across the globe. This will allow us to offer our flexible financing solutions to buyers everywhere, at all price points.”

In another development aimed at SaaS companies, Efficient Capital Labs (ECL) said in August that it raised $11 million in Series A funding to expand its cross-border revenue-based financing offering for B2B SaaS companies operating in the South Asia-U.S. corridor.

In May, Capchase said it received a €105 million (about $114 million) credit facility warehouse led by Deutsche Bank to support flexible financing for SaaS businesses in the U.K. and Europe. The company said it will do so through Capchase Grow, its solution that offers eligible companies access to non-dilutive financing.