CLEARBANC

The Entrepreneur

Andrew D'Souza is the founder and CEO of the Clearbanc. He went to the University of
Waterloo and studied Bachelor of Applied Science and System Design Engineering. He
is a person with a wide range of experience through working in different companies at
different designations. Some of the experiences are:

 Business Analyst at McKinsey & Company from 2008-2010

 Head of Business Development, Sales and Marketing at Top Prospect 2010-
2011
 COO at Top Hat 2011-2013
 Advisor at KIK Interactive Inc. 2014-2015
 Advisor at Wealthsimple 2014-Present
 Co-founder & CEO at Clearbanc 2015- Present

The Business

Clearblanc is the new venture started by Andrew D'Souza in 2015. The business is
situated in Toronto, Ontario. The company was started with a tagline ‘Built by founders,
for founders’ which defines they help the other business to find the right funding options
to fuel their business growth. The industry as a category of work is Diversified Financial
Services. They are the venture capitalist firm which helps new startups to gather funds
but it charges fee rather than equity share in the company. The company started with
just 5 employees but now has a team of 185 employees. They started as the capitalist
firm at a smaller level but now working at a wider level after providing funds to 791
companies to grow in the market. Major customers are the potential entrepreneurs who
are facing problems in raising funding from the market. The major competitors for the
company are:

o Hercules Capital
 o Point Financial
o Vencore Capital
o SAAS Capital

Background of the Business Venture

Andrew told us that from the initial schooling days, he has a great interest in starting his
own business. At the age of 10, Andrew started his first company to provide services of
paper-delivery, lawn moving, dog-walking, and tutoring. This was a phase that helped
him to dream big and work to start his own multi-millionaire company.

Clearbanc came out of an alliance between two entrepreneurs for investing in

companies as angel investors. D'Souza developed the virtual recruiting platform, Top
Prospect sponsored by Andreessen Horowitz, the portable biometric authentication
portfolio of Top Hat, a USV-backed technology tech company and Nymi developer
which helped him to raise the initial amount for starting Clearblanc. After a stint at
McKinsey, he helped raise more than $300 million in business as he began co-investing
in Dragons ' Den with Michele Romanow, a Canadian version of Shark Tank's TV show.
Family background was not that much important but definitely his education and prior
work experience in other companies helped him to know the problem of the market with
finance which gives him an idea to be an investor without asking any equity share from
the new ventures but providing them finance on a little fee charged.

His work in the McKinsey & Company helped him to understand about the business
trends in the market which gives an idea to start something new in the market. After
becoming part of Top Hat, Andrew understands the condition of funding in the market
and how venture capitalists are exploiting the new entrepreneurs; so, his idea to start a
company budded in his mind. His years of experience in the tech and financial field help
him to gain the confidence to start a financial company to provide people a platform to
raise a fund with ease.

Yes definitely, Andrew and his team analyzed the market scenario to know about the
pros and cons when a person wants to raise funds for his idea. He made a plan with his
partners after doing some research in the financial field and then made a strategic plan
to tackle the needs for starting business.

Andrew told us that the initial capital was of the founders in the starting phase but after
that, they raised $159.28 million form market and again raised USD$300 million in the
form of equity led by Highland Capital Partners, with participation from existing investors
iNovia and US-based Emergence Capital.

The risk factor of the company is according to the share of its own in the company. The
risk of bad-debt or the bankruptcy of the funded company is there but the Clearbanc
have followed tight norms to be safe from this factor of risk. The customers for the
company are none other than the new entrepreneurs who are searching for the funding
options for their idea and Clearbanc provided them finances to fulfill their dreams. They
heard the voice of the market, what actually the market wants and then make a plan to
make the things work not according to their company’s advantages but for the other
new venture’s needs. Their motto defines the difference between them and their
competition as it defined ‘‘Built by founders, for founders’.

Competitive Advantages

Andrew said that the competitive advantage is the benefits that a corporation has over
its rivals. This can be gained by the company by providing better and greater value for
their products. Advertising products or services with lower prices or higher quality are in
the interests of consumers. At Clearbanc they used a "20-minute term sheet" an AI
program to make decisions on potential investments. This helps them to know exactly
about the leverage capacity of the company and the continuity of repayment of loans by
the company which is helping them to work away better than there competition as they
determine all the factors of risk on the prior basis and then also give advice to the
companies how they can reach their potential sales figures. The success of the
company is based on all the factors either its skills, luck, new technology or business
contacts. The CEO of Clearblanc used all the possible factors like advanced technology
in the case of AI optimization, business contacts from his last experiences and skills to
manage the finances efficiently. The luck is a factor that cannot be determined but for
sure Andrew was a bit lucky than his competition to make his company a huge success
in this short time frame.

Growing the Business

The growth of a business depends upon many factors like availability of resources,
potential customers, productive employees, expert management teams, and adaptation
of advanced technology and skills. Andrew made a blend of all the available resources
to make a company a success. The company had seen an impressive growth within five
years as it had funded 791 new companies till August 2019 and started making monthly
average gross revenue of $121 million. They had raised $1 billion till now and seeking
to raise more to help the new founders to be a success in the market.

Ethics

Not only are unethical practices in the objective sense of the word wrong, but they also
affect company success when employees cannot concentrate on their work because
they are unethical or business. Ethical practices in business lead to good and morally
focused workers which help to increase the efficiency of the company and the end result
will be the success of the competition. An organization that follows business ethics
management philosophy have demonstrated much better than those that work
unethically for a company's success. For companies to develop a public image and stay
in a competitive position, it is important to lead a company in an ethical way. Through
practicing business ethics, companies can determine accurately and can decide what is
right and wrong for their company’s profile in the market. They can plan, monitor,
implement and evaluate management actions by following the ethics code in business.
Responsibility to customers, their actions and their society can be a considerable
advantage to companies. Any deviation from these fundamentals of running a company
can spoil the image of the company and lead to a loss of customers, stakeholders, and
profits. Andrew also faced some ethical dilemmas when he has to distinguish between
the benefits for the company and the consumer but following the ethical path helps him
to make the company a huge success.

Management

The company is following the democratic management style as it helps to take all the
person into consideration and to make efficient decisions after checking it thoroughly.
The other styles of management were not much of a benefit for the company’s growth if
I talk about personalized and autocratic or laissez-faire which was not that much of
benefit for the company dealing with finance. A single wrong decision can cost a huge
amount of loss. Now, we are shifting towards a persuasive cum democratic style in
which all the employees are free to give their suggestions but the end decision lies in
the hands of the top management.

Organizations

Clearbanc follows the project-based structure for the organization. As it is a company

which deals with a different type of projects and finances other companies, it was the
most suitable way to start. In this type, the projects are divided among a different set of
managers with their teams who directly provide follow-ups to the Directors or the CEO
of the company. This helps to provide proper guidance and devoted strategy to the
customers which helps to create a more friendly and effective atmosphere. Andrew
started a business with this model and is running it successfully with just minor changes
in the organizational structure.

Human Resources

The company have a family of 185 people who are working passionately to make this
organization a complete success. In the initial phase, the company started with just 11
employees but within 5 years, we have seen a huge shift in the employee ratio. From
last year the employee count grew by 340% which is really an impressive stand. Most of
the employees who started with us are part of our team and leading the company to be
a Canadian giant in the financial sector.
Motivation

As we all know, motivation is the key factor for the startups to recharge the employees
to give their best. Andrew also motivated his employees to work for the achievement of
goals. He asked all the employees to set their personal goals also so that it can
motivate them to work to their fullest with efficiency and effectiveness so that they can
achieve their personal as well as organizational goals. At the initial phase, there were
not much of the monetary benefits as the motivation for employees but now they are
providing many incentives for achieving the organizational goals.

Marketing

The new business needs a lot of marketing to sustain in the market. Also, we can say it
acts as lifeblood for organizational development. Andrew also worked with a proper
marketing plan to enhance the capacity of his organization. As a venture capitalist firm,
the first target was to promote the business they are doing this for other entrepreneurs
but they started it from his company the formula of social media advertising investment,
which was a success for them and now helping other founders to take benefit from their
approach. Now they are not spending that much on advertising as the words from
people and success rate is helping them to gain more customers from the market.

Service

Clearbanc is building financial services for companies and owners of small enterprises.
The business also provides revenue financing to help rising online companies, such as
vacation rental companies and e-commerce firms. In order to offer its customers with
more flexible terms than other funding alternatives, Clearbanc uses proprietary
originating and entering and servicing technology. The company is built by
entrepreneurs for entrepreneurs with a goal to promote success for founders as a true
partner. At this company they train and help entrepreneurs to grow in order to achieve
their goals.

Advice
Andrew suggested young entrepreneurs to challenge themselves to do something
innovative so that it can help them to be a step closer to what they want to do and care
about to do. He also highlighted that they should have always to take calculated risks
and always believe in the efforts which they are putting in the idea so that they can
achieve what they want to, with the vision which they have before stepping up for the
initial phase. Also, he mentioned the value of good employees and the person who can
support in the hard times to the company and the entrepreneur. At last, he said to go
with the flow but to have the dedication and will to take actions to make the dream,
vision a reality.

Conclusions

From working the company to starting their own company, Andrew made huge growth in
his career. His 1st job as a Business analyst helped him to understand the basics of the
business which was an initial shift to start a business. As he told in the interview, he had
a great interest in starting a business from early days of childhood which helps him to
be more pragmatic in thinking the new ways to expand his vision and to be a successful
entrepreneur with not only one company but with back to back two startups. His
dedication and sense of business truly define the ways to achieve what a person can
with his knowledge and smart work.

References

 Clearbanc. (2019, August 29). Retrieved from https://en.wikipedia.org/wiki/Clearbanc

 Growjo. (n.d.). Clearbanc Annual Revenue, Number of Employees, Growth and
Funding. Retrieved from https://growjo.com/company/Clearbanc
 Clearbanc Competitors, Revenue and Employees - Owler ... (n.d.). Retrieved from
https://www.owler.com/company/clearbanc
 Clearbanc | LinkedIn. (n.d.). Retrieved from
https://www.linkedin.com/company/clearbanc
 Andrew DSouza - Co-Founder & CEO - Clearbanc | LinkedIn. (n.d.). Retrieved from
https://ca.linkedin.com/in/andrewdsouza
 Careers. (n.d.). Retrieved from https://www.teamclearbanc.com/?lightbox=dataItem-
joe9reuw4
 ANDREW D'SOUZA, Co-Founder & CEO, Clearbanc. (1970, January 1). Retrieved
from https://www.vbprofiles.com/people/andrew-d-souza
53b312b8fcbf80045302da89
 Simpson, M., Simpson, M., Meagan, & Potter, H. (2019, July 31). Clearbanc raises
$300 million USD to take entrepreneur funding model global. Retrieved from
https://betakit.com/clearbanc-raises-300-million-usd-to-take-entrepreneur-funding-
model-global/
 Constine, J. (2018, November 12). Clearbanc raises $70M to give startups ad
money for a rev share. Retrieved from https://techcrunch.com/2018/11/12/clearbanc/
 Dsouza, S. (2017, June 19). Importance of Business Ethics for Profitable Business.
Retrieved from https://medium.com/workethics/importance-of-business-ethics-for-
profitable-business-3ed5de0083b