[Exclusive] Dutch startup Helin raises second round of revenue-based financing from Capital Mills

Helin, a Dutch leader in edge computing solutions, has raised a second round of revenue-based financing from Capital Mills.

The Rijswijk-based startup had first raised RBF from Capital Mills in April last year and the follow-up round comes after a successful 2022 for the startup.

While the terms of the deal were not disclosed, Capital Mills typically invests between €500K to €1.5M using a network of over 50 investors.

With the new funding, Helin will further focus on its managed services in addition to its edge analytics platform called Polaris.

The funding announced by Helin also shows how Dutch startups are now looking at alternate financing like RBF as opposed to equity-based financing.

Making industrial assets more efficient

For industries, the biggest challenge is fool-proofing their existing capital-intensive assets, like solar farms, cranes, dredging vessels, geothermal wells, etc.

With its analytics platforms, Helin helps its industrial clients to operate these assets more efficiently and accelerate their outperformance.

“Using our solutions, they are able to get better insights into their day-to-day operations,” says Bram Masselink, Managing director of Helin.

Masselink explains that the first step is to create an operations report, which is done centrally in the cloud, that can be used by managers to support their assets better.

However, if the local operators are guided and advised in real-time about reaching efficiency with these assets then there will be real gain.

This process of generating guidelines locally on the asset is what Masselink describes as edge computing.

In simple terms, edge computing is the process of bringing cloud computing capabilities locally to store, process, and analyse the data that can help improve the operations and bottom line.

“All these assets are equipped with numerous sensors to be able to control them,” adds Masselink.

“They also generate lots of data. We enable our clients to use this data to gain insight, both locally and at the central office.”

A growing managed services industry

The global managed services market was valued at $267.3B in 2022 and is expected to grow at a CAGR of 13.6 per cent from 2023 to 2030.

With its edge computing solutions designed to improve efficiency of capital-intensive assets, Helin is a key player in this space.

For its clients, the biggest value lies in the insights generated by analytics applications.

In an industry known for limited access to operational data, the insights offered by Helin’s Polaris platform can limit the overhead cost.

Masselink says, “Our clients therefore want to focus all their attention in developing applications that instantly add value.”

Helin is seeing how these companies prefer to assign their resources to data consumption and analytics, and outsource all data acquisition and management.

This lean methodology, Masselink explains, will accelerate the growth of the managed data services industry significantly.

“We provide services by which the sensor data is ingested, buffered, streamed to cloud and by which applications can be deployed on the edge (on the machines),” he further explains.

By combining the client’s domain knowledge and the live data streams provided by its applications, Helin helps the operators to outperform themselves.

Revenue-based financing over venture capital

Dutch startups have found it difficult to access early-stage funding or tap into angel investors, and for them, alternative financing methods like revenue-based financing (RBF) could be the way to not only access capital but also link it with their growth.

RBF is essentially a loan where startups repay the loan based on a fixed percentage of their monthly revenue.

The repayment scales with the growth of the organisation and founders get the benefit of a non-dilutive capital.

Since this was the second round of RBF with Capital Mills, Bram Masselink says it was a no-brainer for the startup, which doubled in size in 2022.

“Both our organisations value long-term and honest relationships and therefore a lot of trust was already present,” says Masselink.

He adds that Helin has a growing number of clients using its subscription-based revenue model. This combination of revenue suits the RBF structure and the operational cash flow.

“The faster we grow, the more repayment capacity is available which can be used to repay the RBF,” explains Masselink.

Capital Mills launched a new RBF fund called Fortibus 7 with plans to invest a total of €12.5M in 15 or more companies last month.

“[RBF] can be a better strategic fit if you do not want to raise the usually big amounts you get when raising venture capital,” explains Gijs den Hartog, an early stage investor and partner at Capital Mills.

Capital Mills has not confirmed whether Helin’s second RBF is part of Fortibus 7 but it seems plausible.

Focus on Industrial-Data-as-a-service

With the additional capital, Helin wants to focus on its managed services arm on top of the software platform Polaris.

Masselink says the second round of funding will be invested in product development and increase the roll out speed with its existing customers.

Speaking to Masselink, it becomes evident that Helin is growing faster and has clients waiting to be onboarded to its managed services platform.

With the funding, Helin wants to further simplify this onboarding process and “strengthen its core product, development team, and sales efforts.”

“Our market is fast growing and the demand for our services is increasing at an even faster pace,” adds Masselink.

The Dutch startup also plans to introduce add-on modules on top of its base ecosystem to enhance security, facilitate smart energy and fuel management for offshore operations and renewable energy assets.

Helin operates in an expansive industry where the scale of growth is endless but the startup wants to have sufficient time to scale within the limitations of its capacity.

Without dismissing the possibility of another RBF soon, Masselink says they want to build a skilled team, create innovative products, and expand its managed services to accelerate its impact.

In an era where every device is connected and cyber threat looming over those assets, Helin is extremely aware of both potential and its limitations. The way it grows could be a learning for many other fast-growing startups.

René Delsing, Investment Manager at Capital Mills, says, “Helin’s growth last year, their domain knowledge and understanding of complex processes and technologies together with their global track record is impressive. We are keen to keep supporting Helin in the development and acceleration of their middleware SaaS offering.”