Clearbanc, a leading digital commerce investor and the company “revolutionizing the way founders grow their businesses,” revealed on Tuesday (April 20, 2021) that it will be rebranding. The company also announced a $100 million in new Series C equity funding to support its ongoing growth plans, bringing the firm’s valuation to nearly $2 billion.
As mentioned in a release:
“To reflect its evolution from a source of efficient capital for founders to a broader platform of growth products and services, the company is rebranding as Clearco. With proprietary algorithms that are gender-, race-, and region-agnostic, Clearco is unique in its commitment and ability to fuel entrepreneurship outside of traditional networks and regions.”
Although international venture capital funding for female founders fell by 27% last year (according to Crunchbase data), Clearco reveals that it funded 8x as many firms led by female founders as traditional VC firms. In that same timeframe, 13% of Clearco’s funding “went to companies headed by Black and LatinX founders, compared to 2.6% for traditional VC firms; in total a third of Clearco funding went to founders of color,” the company noted in its release.
Co-Founder and President Michele Romanow stated:
“The move from Clearbanc to Clearco really signals our move beyond capital. We’ve invested US$2 billion in 4,500 plus companies, and we’re building a product suite to support founders that goes far beyond funding, based on what they’ve told us they need most. Our new name reflects our broad commitment to partnering with founders to build thriving businesses.”
Additionally, Clearco’s algorithms “spread the wealth” geographically, the announcement noted while adding that around 80% of typical US VC funding in 2020 went to 4 states that have “traditionally been tech hubs (California, Texas, New York and Massachusetts).”
Clearco’s total for those states “was 45% with 55% going elsewhere.” The company has funded firms in all 50 US states and all 10 Canadian provinces and three territories, as well as the United Kingdom, “where to date 70% of funds have gone to companies located outside London.”
Romanow added that their goal is “to change the face of fundraising, and we’re really proud to be showing it can be done.”
As stated in the announcement:
“To fuel these plans, Clearco raised US$100M of equity and US$250M of debt in a Series C round that takes the company’s valuation to nearly $2B. Oak HC/FT led the round and Co-Founder and Managing Partner Annie Lamont will join the company’s Board of Directors. Lamont has appeared on the Forbes Midas List and has been a VC and investor for more than three decades. New investors include Founders Circle and executives from Stripe, Square, Affirm, Adyen, Robinhood, Betterment, Airbnb, Hubspot, AirWallex and Apple. The new debt comes from Credigy (a National Bank subsidiary) at a significantly lower cost of capital, allowing Clearco to offer more competitive rates to its growing portfolio than any pay as you grow financing company in history. To date, Clearco has raised over US$170M of equity.”
Co-Founder and CEO Andrew D’Souza noted that with $2 billion deployed to over 4,500 company founders, they have proven that they can find and fund new business owners via machine learning and AI in “a much more egalitarian way.”
D’Souza added that they are “gratified that the investment community sees that.” He also mentioned that they are “excited to welcome Annie to the Clearco Board.” He pointe out that her 30 years of business and investor experience “make her the ideal person to join us at this inflection point and work with our executive team to grow our business and brand.”
“Oak HC/FT is thrilled to partner with the market leader in the alternative funding space. We strongly believe in Clearco’s mission to democratize access to capital, and we’re excited to see this next phase of growth.”
Clearco now provides a suite of performance financing products and services “tailor made to help founders retain ownership including”:
- ClearCapital for ecommerce founders – Clearco’s “signature 20-minute term sheet offers marketing growth capital from $10K-$10M for growing ecommerce founders.”
- ClearInventory Capital – Clearco will “buy your inventory, then you pay it back as it sells through for cost + 6%. This allows founders to pay as they grow.”
- ClearRunway for SaaS Founders – Uses data science and real business metrics “to get access to up to 24 months of future revenue at a discounted amount today. Fund growth, extend runway, and expand faster to get a higher valuation, keep equity, and stay in control.”
- ClearValuation – Advanced data science expands Clearco’s product “beyond capital, providing a free valuation to founders and insights and recommendations to increase their company’s value and connect with investors and M&A buyers.”
- ClearAngel – ClearAngel gives early stage founders (with as little of $2K of monthly revenue) “access to revenue share capital, data-driven advice, and Clearco’s extensive network of apps, agencies, and investors.”
Co-founded as Clearbanc back in 2015 by Michele Romanow from Canada’s Shark Tank (Dragons’ Den), Andrew D’Souza, Ivan Gritsiniak, Charlie Feng, and Tanay Delima, Clearco provides “founder-friendly” capital solutions for digital commerce, mobile apps, and SaaS founders along with a suite of products and access to a global network, insights and data, and recommendations.
Clearco has reportedly financed more than 4,500 firms to date, including Leesa Sleep, fashion-rental service Le Tote, home goods company Public Goods, shirtmaker UNTUCKit, online speech therapy practice Expressable, and digital real estate marketplace SetSchedule.
Establishe in 2014, Oak HC/FT is a venture growth-equity fund investing in Healthcare Information & Services and Financial Services Technology. With $3.3 billion in AUM, they are focused on “driving transformation in these industries by providing entrepreneurs and companies with strategic counsel, board-level participation, business plan execution and access to our extensive network of industry leaders.”
Oak HC/FT is headquartered in Greenwich, CT, with offices in Boston and San Francisco.