The new launch is an industry first aimed at providing online brands a new way to get capital upfront for inventory expenses, but pay it back only once it sells
Clearbanc, the world’s largest e-commerce investor changing the way founders grow their business, announced the company will advance $1 billion in inventory capital to online brands just in time for the busiest online shopping season in history. Clearbanc will lead the industry in being the first company to purchase businesses’ inventory upfront directly from suppliers, expecting only to be paid back once the products sell.
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According to Deloitte, e-commerce sales will grow by between 25% to 35% year-over-year this holiday season, a massive jump from the 14.7% rise from 2018 to 2019, meaning founders need more inventory than ever before to meet demand. But today’s inventory system works against founders, with brands spending more than 50% of their revenues to buy products from suppliers, forcing them to decide between what cash is spent on marketing and other expenses.
Already one of the most stressful times of the year — filled with inventory and cash flow challenges — brands are scrambling to capitalize on the accelerated shift to e-commerce and prepare for an unpredictable shopping season to ensure product availability and avoid “out of stock” scenarios.
Now, Clearbanc will buy your inventory, then you pay it back as it sells through for cost + 6% and the full offering includes:
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- Inventory Financing paid back as it sells: Connect 3PL management software to get up to $10 million and pay it back only when the product is sold with a 6% fee.
- Automatic Invoicing: Simply upload your inventory invoices and Clearbanc will handle payment on your behalf to inventory suppliers, no matter where they’re located.
- Better Rates with Suppliers: By paying upfront with Clearbanc, founders get better rates with suppliers, saving up to 10% on their purchase and essentially negating the 6% Clearbanc fee.
“As we scale our e-commerce presence, the greatest challenge is having the cash required upfront to meet future demand. With Clearbanc’s data-driven Inventory funding, we can overcome this barrier just by showing our strong revenue history,” said Alexander Eburne, founder & CEO of Prepdeck. “Now, we don’t have to sacrifice growth, can focus on our marketing and hiring expenses, and explore our true potential in the largest predicted e-commerce Q4 to date.”
“This is a make or break holiday season for online brands and a huge opportunity for e-commerce founders,” said Michele Romanow, co-founder, and president of Clearbanc. “The last thing a founder needs is to be out of stock and lose out on business which is why opening up more flexible capital solutions are critical to support brands have a record-breaking holiday season and a strong end to a tough year.”
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