Allegrow (Direct Software Limited)
B2B SaaS / Email Deliverability / Sales Tech · Glasgow, Scotland · UK Ltd · GBP → USD
GSV INVESTMENT FII
$1,000,000
$500K CLN#1 + $500K CLN#2
BLENDED VALUE BL
$1,622,115
Growth $1,070K + Rev $2,174K weighted
BLENDED MOIC BL
1.62x
On $1M deployed
TIER DPI
Yellow
Active · Recap strategy
LQ ARR VT
$1,031,635
Dec 2025 · 26.17% YoY growth
FINANCIAL ASSESSMENT
Revenue & P&L Summary (GBP & USD)
Source: Management Accounts Jun 2023, Customer Data Jul 2023, GS Value Tracker Dec 2025, 2024 Plan
| LINE ITEM (H1 2023) | GBP | ~USD |
|---|---|---|
| Sales Revenue | £162,946 MA | $206,129 |
| Chargebacks | (£1,544) | ($1,953) |
| Total Trading Income | £161,402 | $204,174 |
| COGS (AWS, Nylas, Stripe) | £22,771 MA | $28,806 |
| Gross Profit | £138,631 (85.9%) | $175,368 |
| Operating Expenses | £153,855 | $194,629 |
| Net Loss (H1 2023) | (£15,224) | ($19,261) |
ARR TRAJECTORY (USD $K) — H2 2021 TO H2 2025
LQ ARR (DEC 2025)
$1,031,635
MRR $85,970 · Value Tracker
GROSS MARGIN
87%
Value Tracker Dec 2025
YOY ARR GROWTH
26.17%
Value Tracker Dec 2025
PAYING CUSTOMERS
125
Jul 2023 · Avg ACV $4,900
INVESTMENT STRUCTURE
Deal Terms & Cap Table
Source: Executed CLN #1 (Oct 2023), CLN #2 (Dec 2024), Warrant Instrument (Oct 2023), Term Sheet (Sep 2023), Cap Table (Jan 2023)
CLN #1 (OCT 30, 2023)
SecurityConvertible Loan Note C1
Principal$500,000 C1
Interest Rate8% compounding C1
Valuation Cap$6,000,000 TS
Discount20% TS
Term24 months TS
QF Threshold$1,500,000 C1
LenderGSV Investors II LP
CLN #2 (DEC 27, 2024)
SecurityConvertible Loan Note C2
Principal$500,000 C2
Interest Rate8% compounding C2
Valuation Cap$6,000,000 C2
Discount20% C2
MaturityOct 30, 2025 C2
CoC ProtectionGreater of 2x or cap conv. C2
Liq. Preference2x RB
WARRANT (OCT 30, 2023)
Coverage3% of Fully Diluted WR
Strike Price$0.01 / share WR
Term10 years WR
ExpiryOct 30, 2033 VT
HolderGolden Section Holdings, LLC
Anti-dilutionPre-emption to maintain 3% WR
GSV FD Stake16.55% (upon conversion) RB
CAP TABLE — ESTIMATED POST-CONVERSION
| HOLDER / CLASS | SHARES (PRE-GS) | % (PRE-GS) | % (POST-CONV EST.) |
|---|---|---|---|
| Ruari Baker (CEO, Ordinary) | 67,000 | 28.72% | 23.96% |
| Kieran Baker (CRO, Ordinary) | 33,000 | 14.14% | 11.80% |
| Radu Oprea (CTO, Ordinary) | 24,954 | 10.70% | 8.93% |
| Mercia NEVF (A Ordinary) | 45,207 | 19.38% | 16.17% |
| Mercia EIS + Angels (B Ordinary) | 27,297 | 11.70% | 9.76% |
| Others (ADV, Northstar, Ignite, Poya) | 6,747 | 2.89% | 2.41% |
| Option Pool (unallocated) | 29,111 | 12.48% | 10.41% |
| GSV (CLNs + 3% Warrant) | — | — | 16.55% RB |
| Total Fully Diluted | 233,316 CT | 100% | 100% |
INVESTMENT HISTORY
Investment Timeline
Source: GSV Fund II Record, Term Sheet (Sep 2023), CLN #1 (Oct 2023), CLN #2 (Dec 2024), GS Value Tracker Dec 2025
MAR 2020
Pre-Seed — $501K
Allegrow (Direct Software Limited) raises $501K in pre-seed funding led by Mercia NEVF, with participation from David Pritchard and 10+ angel investors. Company initially building a different product before pivoting to email deliverability.
SEP 26, 2023
Golden Section Term Sheet Signed
Term sheet executed between Allegrow and Golden Section. Katie Gregory (Director, Investments) and Ruari Baker (CEO) sign. $500K convertible note at $6M cap, 20% discount, 8% compounding interest. 3% warrant to GS Holdings.
OCT 30, 2023
CLN #1 — $500,000
GSV Investors II LP invests $500,000 via convertible loan note. 8% compounding interest, $6M valuation cap, 20% discount, 24-month term. Separate warrant instrument grants Golden Section Holdings 3% of fully diluted capital at $0.01/share, 10-year exercise period.
DEC 27, 2024
CLN #2 — $500,000 Follow-On
GSV Investors II LP invests additional $500,000 via second convertible loan note. Same terms: 8% compounding interest, $6M valuation cap, 20% discount. Maturity date October 30, 2025. Certificate No. 3 issued. Total GSV deployment: $1,000,000.
OCT 30, 2025
Note Maturity — Holder Discretion
Both CLNs reach maturity. Per Value Tracker: “Holder discretion on convertible note repayment.” At maturity, notes can convert to Series Preferred at $6M cap with 1x liquidation preference, or GSV can elect repayment of principal + accrued interest.
DEC 2025
Current Status — Active (Yellow)
LQ ARR $1,031,635. Blended MOIC 1.62x. Status: Active, Yellow tier. Strategy: Recap / Dividend Recap? ARR crossed $1M milestone. Not profitable but 87% gross margin. Company reports in GBP.
| DETAIL | VALUE |
|---|---|
| Instrument | Convertible Loan Notes (x2) FII |
| CLN #1 Date | October 30, 2023 C1 |
| CLN #2 Date | December 27, 2024 C2 |
| Total Deployed | $1,000,000 FII |
| Deployed + Interest | $1,189,805 RB |
| Current Value (Blended) | $1,622,115 BL |
| Unrealized Gain | +$622,115 BL |
| GSV FD Stake | 16.55% RB |
| % of Fund | 1.70% FII |
| Maturity Status | Matured — Holder discretion DPI |
PORTFOLIO STATUS
Blended Value
$1,622,115
$1,622,115
Blended MOIC
1.62x
1.62x
LP Tier
Yellow
Yellow
LP Status
Achieving
Achieving
PRODUCT & MARKET
Allegrow — B2B SaaS Email Deliverability Platform
Source: Allegrow Pitch Deck, Customer Data Jul 2023, 2024 Plan, Meaningful Exit Doc
Allegrow is a B2B SaaS platform that helps sales teams maximize email deliverability and inbox placement. The platform uses AI and a proprietary network of 2,514+ active mailboxes to analyze, consolidate, and iterate on email performance across all providers and domains in a single system.
The company addresses a massive problem: 83 billion emails per day do not reach the right folder, with 994 billion emails filtered annually. Allegrow’s ICP is software companies with 10–250 employees using tools like Salesloft, HubSpot, and Outreach. Key customers include Algolia, SaaStr, Quantum Metric, Cledara, and Workvivo (acquired by Zoom).
PRODUCT PILLARS
Inbox Placement Analytics
Safety Net (Spam Prevention)
Team Leaderboard & Scoring
AI Content Testing (A/B)
Sending Pattern Monitoring
CRM Integrations (Close, Outreach, SalesLoft)
BUSINESS METRICS
| METRIC | VALUE |
|---|---|
| LQ ARR (Dec 2025) | $1,031,635 VT |
| MRR (Dec 2025) | $85,970 VT |
| YoY ARR Growth | 26.17% VT |
| Gross Margin | 87% RB |
| Paying Customers (Jul 2023) | 125 MA |
| Avg ACV | $4,900 MA |
| Sales Cycle | 31 days PD |
| Net Revenue (VT) | $897,522 RB |
| Implied EV | $10,138,216 LP |
COMPETITIVE POSITION
Quadrant
Automatic + Good Quality Data
Key Competitors
Validity, Litmus, Lemwarm
Moat
2,514+ mailbox network (54.7M tests)
INVESTMENT THESIS
Why Golden Section Invested
Source: Term Sheet, Pitch Deck, Customer Data, Value Tracker LP Presentation
High Gross Margin SaaS: 87% gross margin with strong unit economics. SaaS model provides recurring revenue with low marginal cost. COGS primarily infrastructure (AWS, Nylas, Stripe) that scales sub-linearly with revenue growth.
Exceptional Capital Efficiency: Doubled ARR while burning only $39K in total. Three-person founding team consistently earns below-market compensation. Company reached $600K+ ARR on ~$500K of pre-seed capital.
Proprietary Data Network: 2,514+ active mailboxes generating unique inbox placement data across 54.7M+ test messages. Proprietary network creates a compounding data moat that competitors cannot easily replicate.
Proven Product-Market Fit: 125+ paying customers including enterprise logos (SaaStr, Algolia, Workvivo/Zoom, Cledara). 31-day sales cycle. Customer testimonials cite 200–300% reply rate increases and “millions in revenue” attributed to improved deliverability.
Expansion Revenue Potential: Safety Net feature (usage-based), multi-user seat expansion, new CRM integrations (HubSpot, Salesforce, Apollo planned). Product roadmap drives ACV expansion from $4,900 toward $5,500+ per customer.
Large & Growing TAM: 306 billion emails sent per day, growing 12.8 billion YoY. Email remains the primary channel for B2B sales outreach. Increasing spam filters and AI-driven filtering make deliverability tools critical infrastructure.
RISK ASSESSMENT
Key Risks & Concerns
Source: GS Value Tracker Dec 2025, Management Accounts, Fund II Record, CLN Instruments
HIGH
Growth Deceleration: YoY ARR growth slowed to 26.17% from 104% in 2022–2023. While the company crossed $1M ARR, the decelerating growth rate may limit exit multiples and makes it harder to raise institutional capital at a premium valuation.
HIGH
Note Maturity Passed: Both CLNs matured October 30, 2025. Value Tracker notes “Holder discretion on convertible note repayment.” The conversion vs. repayment decision is pending. Recap / dividend recap strategy under evaluation. Uncertainty on liquidity path.
HIGH
Persistent Unprofitability: EBIT mostly negative through 2025. H1 2023 net loss £15,224. Accumulated losses of £429K exceed invested capital (negative equity). Not profitable per LP presentation. Dependent on external financing or recap to fund operations.
MED
Small Team / Key Person: Three co-founders plus one outsourced developer. Radu Oprea (CTO) is the sole technical architect. Limited bench depth. Team has historically earned below-market compensation. Loss of any founder would be highly disruptive.
MED
Currency & Jurisdiction Risk: Company reports in GBP, investments denominated in USD. FX fluctuations directly impact reported metrics and returns. UK/Scotland jurisdiction adds complexity to US-based fund governance and potential exit mechanics.
LOW
Competitive Pressure: Email deliverability space has multiple players including Validity (enterprise), Litmus (established), and Lemwarm (warmup-focused). Allegrow’s proprietary 2,514+ mailbox network and automatic data quality differentiate, but larger players could replicate with resources.
EXIT SCENARIOS
Return Analysis — GSV $1M Deployed
Source: Value Tracker (F2 Blend, F2 RB, F2 DPI), Meaningful Exit Doc, CLN Instruments
| SCENARIO | EXIT VALUE | GSV RETURN | MOIC |
|---|---|---|---|
| Write-Off | $0 | $0 | 0.0x |
| Note Repayment | — | $1,190K | 1.19x |
| Current Blended | ~$10.1M EV | $1,622K | 1.62x |
| $15M Exit | $15M | ~$2,483K | 2.48x |
| $25M Exit (Min Target) | $25M | ~$4,138K | 4.14x |
| $60M Exit (Temptation) | $60M | ~$9,930K | 9.93x |
GSV returns computed on 16.55% FD ownership (CLN conversion at $6M cap + 3% warrant). MOIC on $1M deployed basis. Note repayment = principal + accrued interest ($1,189,805). Exit targets from Meaningful Exit doc (Ruari Baker): $25M minimum, $60M+ temptation threshold.
RETURN BY EXIT SCENARIO (GSV $K)
LEADERSHIP
Team & Key Stakeholders
Source: Allegrow Pitch Deck, Cap Table Jan 2023, Term Sheet, Warrant Instrument
RB
Ruari Baker
CO-FOUNDER & CEO
Co-founder and CEO of Allegrow. Newcastle University. Holds 67,000 ordinary shares (28.72% FD pre-GS). Led company from 0 to $1M+ ARR. Based in Glasgow, Scotland. Domain expert in email deliverability and B2B sales tech.
KB
Kieran Baker
CO-FOUNDER & CRO
Co-founder and Chief Revenue Officer. Brother of Ruari. Royal Conservatoire of Scotland, Freddie’s Flowers. Holds 33,000 ordinary shares (14.14% FD pre-GS). Leads sales, customer relationships, and revenue growth.
RO
Radu Oprea
CO-FOUNDER & CTO
Co-founder and CTO. OTP Bank, Bucharest University of Economic Studies. Holds 24,954 ordinary shares (10.70% FD pre-GS). Built the platform from scratch. Sole technical architect with one outsourced developer.
GS
GS Coverage Team
GOLDEN SECTION
Dougal Cameron (Manager, GSV Investors II GP). $1M deployed via 2 CLNs. 3% warrant to GS Holdings at $0.01 strike. 16.55% FD stake (upon conversion). Active monitoring with recap strategy evaluation. Guide Services retainer: $20K/yr.
GP RECOMMENDATION
Verdict: HOLD — EVALUATE RECAP
Allegrow (Direct Software Limited) is an active B2B SaaS portfolio company providing email deliverability intelligence from Glasgow, Scotland. GSV Investors II LP deployed $1,000,000 via two convertible loan notes ($500K in October 2023, $500K in December 2024), both at a $6M valuation cap with 8% interest and 20% discount. Golden Section Holdings also holds a 3% warrant at $0.01 strike with a 10-year exercise period (expires October 2033). The combined GSV fully diluted stake is 16.55%. Both notes matured October 30, 2025 with holder discretion on repayment vs. conversion. The blended value is $1,622,115 (1.62x MOIC) based on a weighted average of growth-based ($1,070K) and revenue-based ($2,174K) analyses. The company crossed $1M ARR in late 2025 (Dec MRR $85,970, 26.17% YoY growth) with 87% gross margin but remains unprofitable. Yellow tier, “Achieving” per LP presentation. Strategy: Recap / Dividend Recap? The recommendation is to HOLD the position and evaluate recap options given the matured notes and the company’s ability to service a dividend recapitalization from operating cash flow.
BLENDED MOIC
1.62x
On $1M deployed
BLENDED VALUE
$1,622,115
Growth $1,070K + Rev $2,174K
DPI STRATEGY
Recap / Dividend Recap?
Holder discretion on note repayment
NEAR-TERM CATALYST
Note Maturity Decision
Convert vs. repay vs. recap
KEY MILESTONE
$1M+ ARR Achieved
Dec 2025: $1,031,635 ARR
KEY CONCERN
Growth Deceleration
26% YoY vs. 104% prior year
Prepared by Derek · March 2026 · Sources: GSV Fund II Record, GS Value Tracker (Dec 2025), Executed CLN #1 (Oct 2023), Executed CLN #2 (Dec 2024), Warrant Instrument (Oct 2023), Term Sheet (Sep 2023), Cap Table (Jan 2023), Management Accounts (Jun 2023), Customer Data (Jul 2023), Allegrow Pitch Deck, Meaningful Exit (Ruari Baker), 2024 Plan
SOURCE DOCUMENTS
FII GSV Fund II Record
BL GS Value Tracker F2 Blend — Dec 2025
VT GS Value Tracker — Dec 2025
DPI GS Value Tracker F2 DPI — Dec 2025
RB GS Value Tracker F2 Revenue-Based
LP LP Presentation — Dec 2025
C1 Convertible Loan Note #1 — Oct 2023
C2 Convertible Loan Note #2 — Dec 2024
WR Warrant Instrument — Oct 2023
TS Term Sheet — Sep 2023
CT Cap Table — Jan 2023
MA Management Accounts — Jun 2023
PD Allegrow Pitch Deck
ME Meaningful Exit (Ruari Baker)