Michele Romanow’s Clearco lands over $100 million for turnaround

financialpost.com:

Clear Finance Technology Corp., the lender co-founded by Canadian television personality Michele Romanow, secured a new round of funding, giving it room to mount a potential turnaround after a slowdown in the tech-startup industry battered its business.

The company, which does business as Clearco, said it secured the ability to raise as much as US$100 million through an asset-backed debt facility with Pollen Street Capital, which would provide cash to extend new loans. It said its venture capital backers Inovia Capital and Founders Circle Capital have also taken an additional US$60-million stake in preferred equity.

It’s not clear how much — if any — of the preferred equity stake involved new cash, however, since Inovia, Founders Circle and SVB Capital had purchased US$60 million of debt the company owned to Silicon Valley Bank, which collapsed earlier this year, and turned a portion of it into equity.

The exact terms of the recent transactions weren’t disclosed, but Clearco chief executive Andrew Curtis said the three firms agreed to convert a “big chunk” of the Silicon Valley Bank loan into equity in Clearco instead.

The transaction may give some financial breathing room to the company, a so-called alternative lender that extends cash advances to e-commerce and software startups. That business has been hurt by the rise in interest rates that squeezed venture-capital funding, driving Clearco to cut back its staff.

“The combination of those transactions is fantastic,” Curtis said. “We’re landing multiple planes at the same time, all the transactions are contingent on the other happening. It’s a very complex process, but most importantly, it puts Clearco on a path to sustainability.”

With the new capital, Clearco is now