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Clearco Review (Formerly Clearbanc): Pros, Cons & How to Apply

Clearco (formerly Clearbanc) is one of the newest and fastest-growing players in the business financing game. Founded in 2015, this Toronto-based startup has financed thousands of companies, including mattress manufacturer Leesa Sleep, fashion-rental service Le Tote, and home goods supplier Public Goods.

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Clearco’s growth and competitive edge can be attributed to its narrow target clientele. Though they offer just two products, their requirements cater to two of the most promising industries: eCommerce and SaaS, which stands for “software as a service.” Popular SaaS companies include Slack, Mailchimp, Square, and Salesforce. Clearco’s products are exclusively designed for these businesses’ unique financial circumstances.

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    What Is Clearco?

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    Clearco is a business financing company that specializes in funding tech startups. The company launched to service companies that don’t want to give up equity in exchange for funding. It claims to be the world’s largest eCommerce investor.

    For years tech startups only had the option of venture capital. When a company gets funded through a venture capital firm, it sells a portion of its ownership, known as equity financing.

    Clearco, which launched as Clearbanc, sought to eliminate the need for promising startups to sell ownership shares to get funding. The company’s founders are Andrew D’Souza and Michele Romanow, who appeared on CBC’s Dragon’s Den (a Canadian version of Shark Tank).

    Clearbanc rebranded as Clearco because it wanted to be more than just a bank. Today the company offers advice and resources for young tech entrepreneurs.

    How Does Clearco Work?

    monitor, binary, binary system

    Clearco offers two financing products: ClearCapital and ClearRunway. It also provides a platform for business advice, access to investors, and additional tech startup resources.

    When you register with the company and submit your business information, it will run a check to see which program is right for your business and determine your funding capacity.


    ClearCapital is a form of debt financing that works similarly to a merchant cash advance. You can borrow up to $20 million, and there is no set due date on when the borrower must pay the loan back in full.


    ClearRunway provides invoice financing to SaaS companies in growth mode.

    Eligible Industries

    Clearco is only available for several industries. These industries include:

    • eCommerce
    • SaaS (software as a service)
    • Online retailers
    • Subscriptions companies
    • Mobile apps with in-app purchases
    • Marketplace (beta)

    The cost of the loan is also heavily influenced by how you use the funds.

    Clearco was created as an alternative to venture capital. Up until fairly recently, venture capital was the most accessible source of funding for tech startups. Many startups reportedly end up using most of their venture capital to cover a few considerable expenses. Most startups use venture capital to fund marketing campaigns.

    This leaves the startup with little money to cover other vital expenses, like labor and equipment. And since venture capital is a form of equity financing, the business leader loses a portion of ownership. As a result, the business leader has fewer personal funds to re-invest in the business.

    Clearco strives to eliminate this problem by giving young businesses another way to cover these massive startup expenses.

    What Do You Need to Apply for Clearco?

    startup, start-up, people

    To apply for Clearco, you will need to supply the following information:

    • Bank details such as the account and routing number.
    • Basic information about the business, like your EIN.
    • Basic information about all officers and directors.
    • Articles of incorporation.
    • State-issued ID.

    Other Important Factors for Clearco

    business, computer, mobile

    Clearco is exclusively designed for just six types of companies. All other industries need not apply. Clearco is perhaps the only business financing company with such a strict limitation on clientele. But this shows how confident Clearco is in the rise of these few industries.

    Another considerably restrictive requirement is average monthly revenue: at least $10,000. Once again, this requirement merely reflects Clearco’s projections for eCommerce and SaaS companies. You can’t blame them. $10,000 could be the standard for monthly revenue in both industries in the near future.

    Considering the high growth rate of eCommerce and SaaS companies, it’s no surprise that Clearco only works with limited liability companies (LLCs) and corporations.

    Clearco clients can be in business for as little as six months. However, eligible companies must also have at least six months of consistent revenue. Though the criteria for “consistent” isn’t clear, it’s probably safe to assume that businesses with occasional dips in revenue or startups that ran into a bit of trouble early on won’t qualify.

    Lastly, Clearco has no minimum requirement for a personal credit score. Thus, there is no credit check in the application process.

    With Clearco, You Need To Know That:

    entrepreneur, idea, competence

    Clearco’s repayment structure is the same as a merchant cash advance. Every time you make a sale, Clearco takes a percentage of it until the total amount is paid back in full.

    The loan has two percentages. First is the fixed percentage of future debit and credit card sales from the previous section. The second percentage is also fixed but works more like a flat fee. This percentage can range from 6% to 12.5%.

    The percentage of each sale that Clearco takes is based on cash flow. Businesses with highly consistent cash flow can pay as little as 1% of each sale, while companies with rockier cash flow can pay up to 20%.

    The second percentage, on the other hand, is based on entirely different criteria.

    If you visit Clearco’s website, you will see a list of popular marketing channels like Facebook, Google, Amazon, and Twitter. Companies that use Clearco funds to buy ads from this vendor list will automatically be given a flat fee of 6%. Clearco also offers inventory financing for eCommerce businesses that must make large upfront purchases. However, it’s unclear if this purpose also guarantees a flat fee of 6%.

    If you use the funds for purposes aside from digital marketing or inventory, your flat fee could be as high as 12.5%.

    The minimum borrowing amount is $10,000. Payments are not reported to the personal or business credit bureaus. Thus, timely repayments won’t affect your personal or business credit score.

    Also, Clearco does not require collateral or a personal guarantee. This means that if the business defaults on the loan, Clearco cannot seize the business owner’s personal assets to make up for the lost funds.

    How to Apply with Clearco:

    The full application process from start to finish usually takes 1-2 business days. Here’s how to get started:

    Step 1: Create an Account

    Applying for a Clearco loan requires creating an account on their website. This requires basic information about your business and yourself (the business leader). After entering this information, click “Calculate Now.”

    Step 2: Speak to a Representative

    Once you’ve created an account, a representative from Clearco’s investment team should contact you within 1-2 business days. However, this doesn’t mean you’ve been fully approved.

    It just means you’ve been cleared to complete the rest of the application. This step ensures Clearco doesn’t waste time fielding applications from businesses that don’t meet their general requirements.

    Step 3: Review Offers

    When you log back into your account, you can review loan offers. You will also see instructions about uploading documents and completing the rest of the application.

    Step 4: Connect Your Sales and Payment Accounts

    Then, connect Clearco to the online accounts you use to make sales and payments  (PayPalSquareStripe, etc.). Remember, Clearco is used entirely by online-based companies. Since these companies provide products and services online, all sales and payments are conducted via online accounts.

    Step 5: Connect Your Digital Marketing Accounts

    Next, connect Clearco with the online accounts you use for digital marketing (Facebook, Google, Amazon, etc.) and your sales accounts. It usually takes about 20 minutes to enter the data from all accounts.

    Step 6: Sign Your Loan Documents

    After entering your data, you will receive a loan contract containing your borrowing amount, fixed fee, and repayment percentage. Funds should then appear in your bank account within 24 hours.

    Clearco: Post Funding

    Like traditional merchant cash advance loans, repayments begin as soon as you make sales. Clearco will deduct the percentage of your daily sales disclosed in your contract. After you sign the contract, you cannot adjust your fee or repayment percentage.

    Since there’s no due date, you keep making payments until the total amount is paid off, regardless of how long that takes.

    Even if you haven’t paid off your loan in full, Clearco may allow you to apply for more funds if you meet specific criteria, including:

    • Your revenue has increased dramatically since you originally applied.
    • You have repaid at least 80% of your original amount.
    • You did not receive the maximum borrowing amount when you originally applied.
    • Your business has created a new source of income.

    What are the Advantages of Clearco?

    As you can see, Clearco’s products are geared toward a particular type of customer. Eligible businesses must belong to the abovementioned industries and earn an average of $10,000 in monthly revenue. For this reason, we will consider the advantages of Clearco under the assumption that your business fits this criterion.

    Let’s say you’re a young, growing business looking for a large borrowing amount. Qualifying for a bank loan might be difficult, considering you probably can’t meet the time in business and credit score requirements. You could seek venture capital, but this would involve sacrificing a portion of ownership and profits.

    Clearco’s creators envisioned this exact scenario when designing their product. Even though you’ve been in business for six months and don’t have excellent credit, you could still access up to $10 million.

    Compared to other forms of financing, a merchant cash advance is one of the more expensive options. If you use the funds for digital marketing, you’d have a fixed fee of just 6%. This is substantially lower than the fee for a traditional merchant cash advance.

    Many businesses cannot afford to put that kind of pressure on their cash flow. But if you can meet Clearco’s monthly revenue threshold, you should have no problem affording the cost of a Clearco loan.

    What are the Disadvantages of Clearco?

    If you do not belong to Clearco’s target clientele, applying simply does not make sense. Let’s say you meet only one aspect of this criterion, like your industry.

    If you own an eCommerce business that’s a few years old, you could probably access products more conducive to cash flow than a merchant cash advance. Older companies may have higher credit scores or want to use the funds for purposes other than digital marketing or inventory.

    Thus, like the previous section, we will consider the disadvantages assuming that you belong to Clearco’s target clientele.

    In the past, young businesses with subpar credit could not access high amounts, low rates, and long terms. But the business financing industry has changed dramatically as of late. Many business financing companies now prioritize cash flow over credit score or time in business.

    If you can meet Clearco’s monthly revenue threshold, your credit score or time in business might not stop you from accessing higher amounts and low rates. Compared to Clearco, these options might contain more convenient repayment structures. You probably wouldn’t have to use the funds for a specific purpose to access lower rates.

    A merchant cash advance might not be the only option for a young business with fantastic revenue.

    Pros & Cons

    pros, and, cons


    • Provides equity free capital to tech startups.
    • Special focus on eCommerce and Saas businesses.
    • Borrowing amounts to up to $20 million.
    • Only requires six months in business and no credit check.
    • Low advance fee of 6% to 12% depending on how you use the funds.


    • Only available for six specific industries.
    • Must be a corporation or LLC.
    • Requires $10,000 in monthly revenue.
    • Requires a daily repayment schedule.

    Apply for business funding through United Capital Source today.

    Clearbanc FAQs

    Which Industries is Clearco Best for?

    question mark, pile, questions

    Clearco is available for six types of businesses: eCommerce, SaaS, online retailers, subscription companies, mobile apps with in-app purchases, and marketplace (beta). However, eCommerce and SaaS companies are more likely to meet the other requirements for the approval of these industries. This is because eCommerce and SaaS companies tend to grow very quickly and rely heavily on digital marketing.

    How Long Does it Take to Get Financing from Clearco?

    Completing the application and receiving funding usually takes about 1-2 business days.

    What Type of Funding Products Does Clearco Have?

    Clearco’s main product is similar to a merchant cash advance but offers a form of invoice financing for certain companies. In both cases, the borrowing amount is repaid with a percentage of future sales.

    Is Clearco the Same as a Merchant Cash Advance?

    Yes, the repayment structure for Clearco is the same as a merchant cash advance. Clearco takes a percentage of each sale until the loan is paid back in full. The main difference between Clearco loans and a traditional merchant cash advance is that in addition to cash flow, the loan’s cost depends on how you use the funds.

    What if Clearco Denies Me?

    If Clearco rejects your application, it’s probably because you don’t meet their standards for “consistent revenue.” Even if you generate $10,000 per month, Clearco might still reject your application if they see occasional dips in revenue or cash flow shortages.

    This situation is common with business financing companies that rely primarily on computer algorithms to assess financial health. Remember, a merchant cash advance requires daily payments. Clearco might determine that your daily cash flow cannot withstand this repayment structure.

    But tumultuous revenue doesn’t have to stop you from accessing the borrowing amounts, terms, and rates you’re looking for. Several other business financing companies offer similar products as Clearco and cater to younger businesses. To clarify, you can still get a substantial merchant cash advance with subpar credit.

    These other companies will also make sure that a merchant cash advance is even the right product for your cash flow in the first place. For example, your cash flow may be better suited for another product that takes weekly, bi-weekly, or monthly payments. Younger businesses now have many highly affordable options to choose from, including:

    Making Your Decision

    chess, metaphor, board

    Any business that doesn’t meet the specifics of Clearco’s target clientele should look elsewhere for business financing options. This is especially true for companies over six months old or with strong personal credit. Do you have the cash flow and monthly revenue to qualify for Clearco, but your business is at least a year old? If so, you can almost definitely find a business loan that is significantly more advantageous than Clearco’s merchant cash advance.

    Also, eCommerce and SaaS business owners should not assume they have fewer options because they belong to non-traditional industries. These businesses are the future of the economy, and if anything, the ball is in their court. When you’re exploring different options, business financing companies are developing better products exclusively for your needs.

    Odds are, it won’t be long before another company can offer the same borrowing amounts and requirements as Clearco but for a much lower price. Because the options are so limited, we at UCS give Clearco a 4 out of 5 rating.

    Disclaimer: The Clearco trademark is owned by Clearco and its use herein is for reference purposes only and it does not indicate sponsorship or endorsement from Clearco.

    Apply for business funding through United Capital Source today.

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        At UCS, we understand the value of your time and want to ensure that your application has a great chance of approval. Please take note of the following details before applying:
        • To be eligible, it’s necessary to have a business bank account with a well-established U.S. bank such as Chase, Wells Fargo, Bank of America, Citibank, or other major banks. Unfortunately, online-based bank accounts like PayPal, Chime, CashApp, etc., are not permitted.
        • When describing your current average monthly sales deposits to your business bank account, please provide accurate information. Our approval process is based on your current business performance, and it’s essential to provide accurate details about your current sales in the first question on the application form. We cannot approve applications based on projected revenues after receiving funding.
        We appreciate your understanding and cooperation in ensuring a smooth and successful application process.
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