Clear.co (Previously Clearbanc)
Clearco offers low-cost cash advances to LLC’s and corporations.
- If your company is not eligible, you should go with something else
- If you’re not interested in VC funding, this is great for your company
Clearbanc loan requirements
Your online business (Corporation or LLC) must generate at least $10,000 per month, and you must show six months of revenue.
Compared to other loan products, Clearbanc offers low rates for their cash advances. If you don’t want to give up a significant piece of your business to a venture capitalist, you should consider applying for a cash advance from Clearbanc. Their terms are flexible, and the quick cash flow can help your business grow.
Clearbanc’s services are only available to online businesses. This is a big plus when you consider the fact that your local bank or credit union may not give you the time of day.
We made several attempts at contacting Clearbanc’s customer service department. Unfortunately, we were unable to speak with someone.
What are Clearbanc Fees for the Cash Advance?
Clearbanc will give you a cash advance with a flat fee of 6% to 12.5%. You are required to repay the loan plus a fee with a percentage of your daily Amazon sales. This can range from 1% to 20%.
You will not be facing a repayment deadline. Your sales will determine the payoff date.
How does this Work?
Let’s say you apply for a $10,000 cash advance with a 10% fee. You don’t need to have the brain of a Harvard math professor to see that the 10% fee brings your loan total to $11,000.
Once you get the funds, Clearbanc will take a cut of each future sale until you’ve repaid the entire loan.
Let’s say it takes you six months to repay the loan. This would be equivalent to an APR of approximately 37%. If it takes you a full year to repay the loan, that would be equivalent to an APR of approximately 20%.
What Do You Need To Qualify For A Cash Advance with Clearbanc?
You must meet the following requirements to get approved for the cash advance:
- You must have a corporation or an LLC
- You must be in an eligible industry
- Your business must generate at least $10,000 of monthly revenue
- Your business must have at least six months of consistent revenue
What Type of Information do you need to Submit?
You need the following documents or information when you apply for a cash advance:
- Your banking account and routing number
- Information about your business
- Information about your officers and directors
- State-issued identification
- Articles of incorporation
What Type of Companies is Clearbanc Interested in Working With?
- Online retailers
- Software service providers
- Subscription companies
- Mobile apps with in-app purchases
The Pros and Cons
Clearbanc is a viable solution for Amazon sellers. However, it’s a little more expensive.
- No credit check
- Get up to $10 million dollars
- Competitive advance fee of 6% to 12.5%
- You only need to be in business for six months
- Daily repayments
- Effective interest rate is more expensive than traditional banks
- Only incorporated businesses and LLC’s can apply for the cash advance
- Reaching the customer service department can be difficult
Is Clearbanc a Legitimate Company?
Clearbanc’s offer may seem like it’s too good to be true. However, Clearbanc is a legitimate company. Clearbanc uses military encryption to protect your personal information from hackers and other prying eyes.
Unlike other lenders, Clearbanc will not share your information with third-parties without your consent. This is why it’s important for you to read the fine details before applying for a cash advance.
How Can You Apply For A Clearbanc Loan?
Here are the five steps for applying for a cash advance from Clearbanc:
1. Go to Clearbanc’s website and click “Get Started”.
2. Enter your business information and click “Calculate Now”.
3. Carefully follow the directions to connect your online accounts (for sales and payments). Click “Verify”.
4. Carefully follow the directions to connect accounts that you use for online marketing. Click “Continue”.
5. Create and enter a password for your new account. Click “Create your Account”.
Your application will be processed within two business days.
What Happens Next?
Clearbanc’s investment team will contact you within one to two business days. Log-into your account, so that you can review your offers. You will see clear instructions on how to submit documents and complete your application.
Once you are approved, the funds will be deposited in your bank account within 24 hours.
How Do Repayments Work?
Once your revenue begins to kick in, your repayments will begin. Please keep in mind that you cannot make any changes to your loan agreement. As the old saying goes, “A deal is a deal”.
If your business meets the following terms, you may be eligible to apply for more funds:
- Your company’s revenue has increased since the last advance
- Your company has repaid at least 80% of the balance
- Your company has a new stream of income that’s producing more revenue
- Your company did not take out the maximum advance during the last loan with Clearbanc