Toronto-based fintech Clearco announced the completion of multiple actions to recapitalize its business and solidify its position as the leading provider of growth capital to e-commerce businesses.
The transactions include “a $60M equity raise from existing investors and a new asset-backed financing facility, which provides up to $100M in financing capacity, and is expected to support $850M of Clearco originations over the next two years.”
These accomplishments herald a new era at Clearco and “mark the culmination of over 12 months of transformational change spanning technology, product and management.”
The $60M USD Series D investment round was “led by longtime Clearco investors Inovia Capital and Founders Circle Capital. Alongside the fundraise, Clearco announces the closing of a new committed asset-backed facility from Pollen Street Capital (“Pollen Street”), a leading global alternative asset management firm.”
The Pollen Street facility will be “used to fund revenue-based advances to e-commerce businesses that have been approved for funding through Clearco’s AI-backed underwriting model.”
Andrew Curtis, CEO of Clearco, said:
“We are thrilled to announce this new round of funding and the launch of a new asset-backed facility as part of a broad recapitalization, which substantially delevers the company and creates a new and improved Clearco. All of these actions allow us to continue to support the growth of e-commerce businesses during a time of funding challenges for many companies. We are firm believers in the continued resilience and growth of e-commerce as an industry, and are committed to providing the capital and resources these businesses need to succeed.”
Clearco customers can “access between $10,000 and $2M in Invoice Funding with predictable payment amounts over periods typically ranging from 4-6 months and no hidden fees.”
Clearco’s Invoice Funding product “provides a stable source of working capital for companies looking to scale their operations and unlock cash flow, helping those merchants to grow in a market where lenders continue to retract from providing capital.”
Clearco’s recapitalization comes at a pivotal time “when startups and specifically e-commerce businesses are facing multiple challenges, including reduced access to capital.”
Venture capital funding “fell 48% in the first half of 2023, the lowest levels since pre-pandemic, and banks continue to tighten lending to small businesses. With limited access to capital, global economic uncertainty and rapidly rising interest rates, many businesses have been forced to slow their growth, underscoring Clearco’s indispensable role in small business financing markets.”