Payments startup Now raises $9.5M in Series A funding

Unbeknownst to many, Georgia-based lawyer Stacey Abrams – yes, that Stacey Abrams – has been a fintech entrepreneur since 2010. Together with Lara O’Connor Hodgson, Abrams co-founded Now, a toolset that automates the process and timing around when businesses get paid. The company announced that it raised $9.5M in Series A funding this week.

Why should we care?
Now seeks to take the friction out of business payments, particularly when long delays getting paid force businesses to take out loans to cover the shortfall. Some businesses use invoice factoring firms where invoices are sold and companies get 70% to 90% of the value of the transaction in exchange for getting the money upfront. Now wants to simplify the process by offering a platform where vendors get paid instantly by Now in exchange for a 3% to 5% fee, similar to credit cards. Customers, in turn, pay Now in 30 to 90 days. The company has so far served more than 1,000 small businesses and processed more than $700M in transactions. “When you’re a small business and someone tells you we have a solution to a problem that no one has been willing to solve, we sound like magic,” Abrams said in a recent interview. The company says it sells bonds, much the same way as large incumbents do, and in doing so, it’s able to access low-cost capital. Now has also built a system to manage risk, according to O’Connor Hodgson.