John Gallagher: Texas Is a Great State To Do Business. The Regulations and General Business Community Are Focused On Supporting Each Other To Give Every Business the Best Chance of Success

John Gallagher of Element Finance.

Tell us about yourself?

For over 20 years, I’ve had the pleasure of working in the finance, M&A, and business space. Having worked with Mazars Ireland, and Irelandia Investments, one of Ireland’s most prominent family investment offices, as well as serving as a SaaS CFO consultant to some of the fastest-growing software companies in Europe, I’ve gained a deep understanding of SaaS business and the gaps in available financing.

Bringing together experience working on M&A, equity, and debt investments covering sectors including aviation, real estate, start-up technology, and software companies has provided me a unique outlook on the world of finance and how it should be used at different stages in a company lifecycle.

As the CEO of Element SaaS Finance, I get to work with an amazing team that has helped grow the company 150% year over year through a balanced blend of strategy, innovation, and a personal, partnership-led approach, resulting in flexible solutions tailored to the founder’s needs.

I have Bachelor of Commerce from the University College of Dublin. In my spare time I enjoy spending time with my wife, and young children and getting the occasional opportunity to lose a few golf balls on courses with wide-open fairways, just to keep it sporting.

What lessons has being an entrepreneur taught you? 

Being an entrepreneur requires developing new skills and changing how you work at every stage.

In the early days, you are doing most things yourself (of what you can get away with), you are spread thin, and it can be challenging to keep the strategic hat on during this time. As you grow, you need experts to come in and start taking the weight of the workload off you.

This frees up your time to do other things but also means that what is getting done is probably more professional. So, in summary, if you want to be an entrepreneur, be prepared to constantly learn, change, wear many hats and do whatever it takes to get the job done.

If you could go back in time to when you first started your business, what piece of advice would you give yourself?

Be scrappy!! In the gig economy that we live in now, there are so many contractors who will do pieces of work for you which move the needle.

You don’t need full-time people straight away. This allows you to build into your business.

So be confident using these people. Their the greatest asset is happy clients and referrals so they will want to do a good job for you.

A lot of entrepreneurs find it difficult to balance their work and personal lives. How have you found that?

Any entrepreneur will tell you it’s not even about the hours spent at the desk.

You live the business 24/7. So making sure to get out doing activities with friends and family is quality time. Don’t burn out. It can be a long road.

Give us a bit of an insight into the influences behind the company?

Element Finance got its start out of necessity by Scaleworks – a group of seasoned SaaS operators who faced the challenge of accessing growth capital to grow their family of SaaS companies.

Traditional banks weren’t an option as they didn’t value the SaaS recurring revenue model and wouldn’t lend to companies with no profit or tangible assets but who had amazing customer metrics and growth.

So we raised our first lending fund so our companies could easily access growth finance without dilution. It went so well that we expanded our fund to help companies around the globe by providing growth finance.

In three years, we have helped our customers grow ARR on average 38% each year and increased available capital to founders as they have grown.

What do you think is your magic sauce? What sets you apart from the competitors?

We combine the passion and know-how to guide founders on their funding journey to build the right capital stack.

The capital stack represents different types of financing; each layer has its own risk and return potential that is crucial for founders when deciding which type of investment and level of risk is best for growing their business and preserving their interest.

At Element Finance, we have a proven track record of helping SaaS founders. Unlike automated lenders that fail to understand founders’ needs, our boutique and hands-on approach helps customers get the right type of finance to grow their business without dilution.

How have you found sales so far? Do you have any lessons you could pass on to other founders in the same market as you just starting out?

Undoubtedly, technology plays a much more significant role in our lives than it used to. However, it’s critical to keep in mind that human connection still matters.

Therefore, we believe in going beyond spreadsheets and getting to know the people behind the products so that we can make well-informed decisions when lending.

What is the biggest challenge you have faced so far in your business, and how did you overcome it?

We are lending to technology and software companies that are not always run for profit. So going from a Pandemic in 2020 into a recession, we have to make sure that we communicate with our borrowers about their business performance and make sure we are aligned in how the business is being run.

What do you consider are the main strengths of operating your business in Texas over other states in the US?

Texas is a great state to do business. The regulations and general business community are focused on supporting each other to give every business the best chance of success. It is very much a can-do mindset.

Are there any disadvantages of operating our business in Texas?

If there are challenges in operating a business in Texas, we haven’t faced them. We are proud to be a Texas-based organization.

Texas has a pretty diverse population. How have you found the quickly changing demographics have impacted your business? Have you got new opportunities? Managed to expand your business into new areas?

Texas is very diverse, and I think this is great for business. It gives us a unique view of the world and different cultures, which in today’s world of global business provides us with an advantage when talking to various customers worldwide.

It is often reported that, in Texas, politics and business are intertwined. Have you noticed this? Has it impacted your business?

Texas has the 9th largest economy in the world, leads the nation in high tech exports, and has a 90% graduation rate, among the top 5 highest in the country, creating a strong talent pool for corporate growth.

We’ve found many advantages of not only operating a business in Texas but also supporting other Texas-based technology companies with their funding needs.

With rising prices across Texas (and the US as a whole) have you been impacted? Do you have a plan for dealing with inflation going forward?

Inflation is a concern for all businesses. On one side, you may have to increase prices for your customers, and on the other side, you need to make sure that as a team, we keep remuneration in line with the cost of living.

What do you want to accomplish in the next 5 years with your business?

We will strive to continue to help change the narrative that debt for SaaS companies is something to be avoided at all costs.

We will focus on raising awareness that debt can often be a much better option for growing a company while protecting the interests of the firm’s founders.

And finally, if people want to get involved and learn more about your business, how should they do that?

People can visit to learn more about our team, revenue-based finance, and fixed-term loans, as well as get access to a curated collection of insights, common terms, SaaS funding industry updates, and venture-debt calculators to help navigate the world of growth finance.

Follow Element Finance on Twitter or Linkedin.

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