Clearbanc, a Toronto-based provider of marketing capital for e-commerce brands, has raised about $92 million (US$70 million) in financing.
The round was backed by Emergence Capital, Social Capital, CoVenture, Founders Fund, 8VC, iNovia Capital, Real Ventures, Portag3 Ventures, Precursor, WTI, Berggruen and FJ Labs.
Emergence Partner Santi Subotovsky will join the board.
Clearbanc provides pre-revenue e-commerce businesses with $5,000 to $10 million-plus in marketing capital without personal guarantees, warrants, equity or credit checks. It has already funded more than 500 companies with over $100 million.
Clearbanc was founded in 2015 by CEO Andrew D’Souza and President Michele Romanow, both serial entrepreneurs and angel investors.
Photo: Clearbanc’s team.
Clearbanc Creates New Model For Funding Entrepreneurs, Closes $70M Investment from Top Silicon Valley VCs
Dragons’ Den TV Star Michele Romanow’s Fintech Company will Fund Over $100M in Marketing Capital this Year
SAN FRANCISCO, Nov. 12, 2018 /PRNewswire/ — Clearbanc, a company that funds marketing for fast-growing ecommerce brands, at Techonomy today announced it has closed a $70M USD investment from a group of investors including Emergence Capital, Social Capital, CoVenture, Founders Fund, 8VC, iNovia Capital, Real Ventures, Portag3, Precursor, WTI, Berggruen, and FJ Labs. Emergence Capital Partner Santi Subotovsky will join the company’s board of directors.
The company was founded in 2015 by serial entrepreneurs and angel investors Andrew D’Souza and Michele Romanow, who is also a Dragon on Canada’s hit television show, Dragons’ Den (Canada’s Shark Tank).
Clearbanc’s technology gives entrepreneurs access to capital without personal guarantees, warrants, equity, or credit checks. Its online automated system scans data from a business’ existing platforms like Stripe and Facebook, to gauge their financial health and revenue trajectory. Qualified businesses receive ongoing capital in as little as one day as a capped revenue share deal. Businesses only repay the capital as they make revenue with no set repayment date and no compounding interest, ownership or control terms. Clearbanc provides companies with $5k to $10 million or more in marketing capital.
Founded by well-known entrepreneurs and venture capitalists, Clearbanc provides funding without equity ownership
“I saw hundreds of entrepreneurs on Dragons’ Den every year, who had great businesses but needed a better funding model,” said Romanow. “Whether an entrepreneur needs $10 thousand or $10 million, we started Clearbanc to serve them efficiently and scale in a manner other investors cannot.”
“This is a landmark year for us. We’ve funded over $100M in marketing capital for over 500 ecommerce brands already in 2018,” said co-founder and CEO Andrew D’Souza. “Clearbanc not only puts the power back in the hands of entrepreneurs — rather than investors and banks — but also plans to fund millions of small businesses globally instead of the small handful that most investors typically fund in a year.”
Ecommerce businesses booming with easier access to marketing funds
The unique finance model is clearly a win-win for Clearbanc and its customers. Its average portfolio company is growing at over 100 percent per year, with the majority using their Clearbanc funding to finance high-growth digital marketing campaigns.
“After completing the Y Combinator accelerator program, I used to spend so much time talking to investors who didn’t understand my business model,” said VINEBOX co-founder and CEO Matt Dukes. “Pitching was always a struggle, even though my business was growing rapidly. With Clearbanc, I accessed marketing capital easily and within a matter of days. This allowed me to double down on marketing, grow the business over 500 percent, and successfully raise a better venture capital round.”
With U.S. ecommerce sales netting $400B last year alone, and YOY (2017 to 2018) internet advertising spend growing 22 percent, Dukes is far from alone. Millions of entrepreneurs are looking for alternatives to venture capital or traditional bank loans to help fuel their growth. “Almost 40% of venture capital dollars invested in startups goes directly to Google and Facebook for advertising. Equity is a very expensive way to fund this growth while loans add more risk. We’ve developed a much better alternative for these businesses – this is a huge opportunity for us and an exciting time for the entrepreneurs we support,” D’Souza added.
Watch the announcement live at 4pm PT at techonomy.com
Clearbanc was founded in 2015 with the mission of providing growth capital for online-enabled businesses, using actual business data instead of a personal credit score. Co-founders Andrew D’Souza and Michele Romanow are successful serial entrepreneurs and angel investors. Clearbanc was part of the first group of entrepreneurs participating in the Y Combinator Fellowship program.
For more information on Clearbanc, visit https://clearbanc.com/