After co-founding Insomnia Consulting, Stacey Abrams and Lara O’Connor Hodgson started Nourish to solve a personal problem.
“We were at a meeting, I think for one of my campaigns,” said Abrams, the Georgia-based lawyer and politician whose work on voting rights has become a focal point for the country in 2020. “[O’Connor Hodgson] needed to prepare a bottle and had to trust the waiter to pick up the bottle and wash it. She said, “I just wish there was a Dasani for babies.” “
Ultimately, however, Nourish ran into a problem. The company has been the victim of its own successes, to hear Abrams describe it – or, more precisely, the victim of a system that has not provided it with the right tools to grow. A billing problem finally brought the daycare to a halt. But it was precisely these failures that planted the seed for their next venture, simply named Now.
“We started looking for a loan. All we needed was the money to fulfill the order. It was during the credit crunch, and we couldn’t get it, ”Abrams told TechCrunch. “We went from the bank to the credit union to factoring, and every time we approached the end the lending model changed and we were kicked out of the program. Ultimately, unfortunately, we had to let our business die. We grew up to death. We got too big to meet the needs and we had no solution.
Abrams and O’Connor Hodgson founded Now in 2010 to give small businesses a faster way to pay their bills. When a business submits an invoice through NowAccount, the service pays 100% of the invoice, less a 3% merchant fee.
“We sell bonds in the capital market, just like American Express does,” says O’Connor Hodgson. “We have very low cost capital that allows us to immediately give this small business its income. And then we’ve built a system that allows us to manage the cost and the risk of that, because then we’re going to wait over 30 days to get paid.
Today, the Georgia-based company announced that it has raised $ 9.5 million in Series A funding. The round, led by Virgo Investment Group and featuring Cresset Capital Partners, will be used to help make evolve Now’s offerings. It comes as the pandemic has put even more pressure on the bills of many businesses. O’Connor Hodgson says the average wait time for bill payments has dropped from around 50 days to 70-80 days.
“We have served over 1,000 small businesses and processed over $ 700 million in transactions,” says O’Connor Hodgson. “So that’s $ 700 million of their capital that they received earlier.”
So far, Now’s growth has been largely word of mouth. The new influx of funding will go, in part, to the market and advertising to put the product in front of more small businesses.
“When you’re a small business and someone tells you that we have a solution to a problem that no one was willing to solve, it looks like magic,” says Abrams. “And what we want people to understand and a lot of our scaling challenge has been, you have to experience it to believe it. And get businesses to understand that it actually works the way we say it actually benefits you the way we imagine it, and it works. “