Clearbanc is a business lender that provides advances, but with a bit of a twist. They service only a few types of businesses, with a focus on companies that process payments online. Clearbanc funding is uniquely suitable for eCommerce clients.
From the start, we must inform you that Clearbanc’s advances are not for most businesses. You can’t use their funding for anything you want. In fact, their advances are strictly meant for advertising campaign financing on social platforms. This includes Facebook, Google AdWords and other platforms.
Although it’s a young company, Clearbanc is making waves with its technological applications. Let’s have a look at the unique option that Clearbanc offers its online clients…
Clearbanc Funding: Special Qualities & Features
Specific Purpose
Clearbanc has a clear and fully transparent mission. They only provide their financing to eCommerce and Consumer SaaS companies. While they’ve stated their goal of expanding over the next while, these are the only companies they serve right now.
While Clearbanc funding is limited in where it’s provided, it is a great product for the businesses it finances. Clearbanc’s focus and precision have made it a well-tailored option for businesses in the industries it serves.
Low-Cost Advance
Clearbanc provides a cash advance and charges customers between 1% and 20%. The advance strongly resembles merchant cash advances (MCAs). If you qualify for their better rates, you qualify for some of the best MCA rates on the market. If your business could use some of the great benefits an MCA offers, but at a lower cost, Clearbanc is worth considering.
No Credit Score Requirements
Clearbanc charges you based on your business data. You don’t need to have your credit score pulled. Instead, you just need to provide access to your revenue data. Their system uses multiple metrics to analyze your business with the help of AI.
Fast Access To Large Sums
You can receive Clearbanc funding up to $10,000,000 in three days or less. Of course, the amount they are willing to provide will be determined by their assessment.
Transparency
There are no hidden or sneaky fees with Clearbanc. There are also no compounding interest charges.
When you do business with Clearbanc, you will see the rate you would be paying before you accept their offer. The fee they offer you does not change throughout the repayment process.
You can keep up with your advances and repayments in their simple online platform. You can check your Clearbanc account to track your payments and see how close you are to paying your advance off.
Negotiation
Clearbanc has a policy of working with businesses to determine a fair and affordable rate. As they state, the factors they charge are typically between 1% and 20%. You can negotiate with them and see if they can provide you with a rate that doesn’t interrupt your cash flow beyond what is necessary.
Fast Advances
If you need an advance quickly and at a fair rate, Clearbanc has you covered. After countersigning, funds will typically arrive in under 24 hours. The only exceptions are particularly large advances, which may take another business day to arrive.
Multiple Simultaneous Advances
You can have multiple MCAs from Clearbanc at the same time. There are just a few exceptions. If any of the following situations apply to you, you can only have one advance active at a time:
- The maximum amount was taken out on the first advance
- You experienced quick revenue growth since the first advance
- You gained a new source of income
- Less than 80% of the first advance is paid off
Clearbanc Funding vs. Venture Capital
Clearbanc might seem like an answer to the problems with venture capital (VC) companies. In many ways, they are!
VC companies make their money in the long term. Because they buy partial ownership in your company, you owe them for the life of your business. Clearbanc has managed to leverage technology to provide a better path to growth.
Clearbanc Funding Pricing & Terms
Clearbanc offers you one consistent rate that remains in place until your advance is paid back in full. This rate is between 1% and 20%.
Like MCAs, repayments are made by automatic deductions of future revenues. There is no set repayment date. The deductions simply continue until your advance is paid back. This provides you with a lot of flexibility, as you don’t need to worry about fixed deadlines.
Do I Qualify For Clearbanc Funding?
If your business is in either eCommerce or Consumer SaaS, you qualify for a Clearbanc advance. The only catch is that, as stated, their advances have one specific purpose.
Factors To Keep In Mind
Jack Of One Trade, Master Of One
Clearbanc funding is given out to specific companies for one specific purpose. If you’re looking for marketing capital for your eCommerce or Consumer SaaS company, Clearbanc is the best option you will find. If you’re looking for any other kind of funding, you must look elsewhere. It’s as simple as that.
Automatic Deductions
While Clearbanc is far less expensive than similar business financing options, it still makes automatic deductions. You should consider how the automatic deductions you provide them with will affect your cash flow before signing off on an offer.
If you are concerned about this issue, keep in mind you can discuss your concerns with them. Clearbanc has an open offer to speak and negotiate with any business that qualifies for their advances.
Clearbanc Funding: The Last Word
So, Clearbanc funding: is it an MCA? Well, the answer, strictly speaking, is no. However, their funding and repayment processes are very similar to those of an MCA.
With Clearbanc, you can expect far better rates and service than you would from typical MCA lenders. The company is very young, but it’s run with the use of modern technology and is meant for modern industries. You can get the growth capital you need, without debt interest and hard repayment deadlines. You also don’t need to give up any equity to do so. This makes them a strong answer to the shortcomings of VC.
While Clearbanc’s offer is unique, it is unique in all the right ways. The only problem is that their offer is so specific. However, that is likely to change in the future.
