Check out the 7-page deck that Now, Stacey Abrams’ fintech that wants to help small businesses ‘grow fearlessly’, used to raise $29 million
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- Now is a fintech that aims to help small businesses manage their invoices.
- The company was cofounded by politician Stacey Abrams and entrepreneur Lara Hodgson in 2010.
- Now raised $29 million in an extension of its Series A with this 7-page pitch deck.
About a decade ago, politician Stacey Abrams and entrepreneur Lara Hodgson were forced to fold their startup because of a kink in the supply chain — but not in the traditional sense.
Nourish, which made spill-proof bottled water for children, had grown quickly from selling to small retailers to national ones. And while that may sound like a feather in the small business’ cap, there was a hang-up.
“It was taking longer and longer to get paid, and as you can imagine, you deliver the product and then you wait and you wait, but meanwhile you have to pay your employees and you have to pay your vendors,” Hodgson told Insider. “Waiting to get paid was constraining our ability to grow.”
While it’s not unusual for small businesses to grapple with working capital issues, the dust was still settling from the Great Recession. Abrams and Hodgson couldn’t secure a line of credit or use financing tools like factoring to solve their problem.
The two entrepreneurs were forced to close Nourish in 2012, but along the way they recognized a disconnect in the system.
“Why are we the ones borrowing money, when in fact we’re the lender here because every time you send an invoice to a customer, you’ve essentially extended a free loan to that customer by letting them pay later,” Hodgson said. “And the only reason why we were going to need to possibly borrow money was because we had just given ours away for free to Whole Foods,” she added.
The disconnect in the business-to-business invoicing life cycle became the inspiration for the business partners’ other startup, Now, which launched in 2010.
Now aims to solve the capital supply chain woes that plague bootstrapped businesses that have to choose between paying invoices and keeping the lights on.
The fintech uses its own line of credit to purchase invoices from its customers, which allows Now to pay its customers immediately, “as if their customer handed them a Visa card,” for a flat, one-time service fee, Hodgson said. When the invoice payment is eventually made by the end customer, that money goes to Now.
The 11-year-old fintech raised a $29 million extension of its Series A on Thursday in financing from a new credit facility ($25 million) and equity investment ($4 million) led by Brigade Capital Management and Virgo Investment Group. The initial Series A was a $9.5 million equity investment raised in June.
Now has served more than 1,000 small businesses who use their NowAccount with over 10,000 of their customers, Hodgson said.
The line of credit will be used to reach more customers and continue serving its existing customers, whose businesses have grown at a quicker clip without capital supply-chain strains, Hodgson said.
The equity investment will be used to add more products and build out client success and marketing teams.
Here is the pitch deck Now used to raise an extension of its Series A.
Editor’s note: This story has been updated to reflect the raise was an extension of Now’s Series A.