Codec: A Journey From VC to Debt

Background and Funding Journey

Codec’s founder, Tom Blah, brought a unique perspective to the fundraising process, having previously worked in venture capital. Despite this experience, he found the realities of raising capital as a founder to be far more complex and challenging than anticipated. The main hurdles included the time required to secure funding, finding investors whose timelines and growth strategies aligned with Codec’s ambitions, and managing the complexities around exit preferences and board control.

Traditional venture capital, while offering significant resources, often came with expectations for aggressive growth and longer-term profitability horizons. For Codec, this approach conflicted with their goal of reaching profitability quickly and maintaining strategic flexibility. Tom noted that VC funding can limit exit options and dilute founder control, which was not the right fit for Codec’s vision.

Why Fuse Capital and Private Debt?

Working with Fuse Capital, Codec was able to secure a private debt facility that provided the flexibility and control they needed. Fuse Capital’s expertise streamlined the process, from preparing the business model and financials to identifying the right lending partners and structuring the deal. Tom emphasized the importance of flexibility and fit throughout the process, stating:
“Fuse really understood what the lenders needed to see and in what format. Super smooth and easy process, not enough good things to say about it.”

Impact and Use of Funds

The capital raised was deployed as classic growth capital—enabling Codec to strengthen its product and sales engine, expand account sizes, and accelerate lead generation. The funding also supported ongoing R&D, helping Codec stay ahead in the competitive deep-tech sector by unlocking new data sources and expanding into additional markets.

By choosing private debt over traditional venture capital, Codec was able to manage equity dilution, retain operational control, and build a strong advisory board without external interference. The structure of the deal fit Codec’s strategy, providing the right amount of capital at the right time, and supporting their growth ambitions without unnecessary pressure or loss of control.