Startup Co-founded By Stacey Abrams Receives $9.5 Billion On Series A Funding

Financial startup co-founded by notable political activist, Stacey Abrams, and Lara O'Connor Hodgson, has just received $9.5 million in Series A funding.

The funding which was announced last week, was led by the Virgo Investment Group and featured Cresset Capital Partners. According to the startup, it will be channelled towards marketing and advertising on order to attract even more small businesses to the financial platform.

The startup, Now, which was founded in 2010, focuses on helping small businesses pay invoices faster. All the businesses need to do is set up an account with Now, and whenever it submits an invoice, Now processes that within two days, minus a 3% service fee.

According to co-founder Lara O'Connor, this is a major improvement from the normal time-frame for invoice processing, which has now moved to around 70-80 days from the 50 days before the pandemic.

This aims at helping small business pay for expenses, equipment, and staff faster without the hassle of waiting for the invoice to be processed by the company or individual it would have been sent to. Stacey Abrams and O’Connor conceived this business idea when another business they started grew too fast and they lacked the necessary tools to manage it.

“We started looking for a loan. All we needed was the money to meet the order. This was during the credit crunch, and we could not get it,” Stacey Abrams said to a news magazine. “We went from bank to credit union to factoring, and every time we got near the end, the credit model changed and we got kicked out of the program. Finally, unfortunately, we had to let our business die. We grew to death. We got too big to meet the needs and didn’t have a solution.”

The coronavirus pandemic which started in 2020 crushed small businesses, most especially minority and Black-owned small businesses. In a nationwide survey carried out last year, it was discovered that 45% of small, Black businesses anticipated closing within three months. 

Another report by CNN Business, revealed that the first round of the Paycheck Protection Program(PPP), a $2 trillion coronavirus relief package, was diverted by large companies and corporations.

Large chunks of the funds went to large restaurants, hotel chains, and publicly traded companies, instead of the smaller companies that needed it more. Companies like Shake Shack, Fiesta Restaurant, and Potbelly Sandwich Shop, all landed $10 million in loans from the PPP.