An Atlanta company that is making cash advances to online sellers announced it has received more than $6 million in funding.
Kabbage, Inc. will use the $6.65 million, in part, to advertise its service, chairman and co-founder Marc Gorlin said.
Gorlin said companies that do most or all of their selling online often have a hard time getting bank loans, regardless of how much they make. Kabbage uses an automated system to check eBay, PayPal and other accounts and distributes the advances directly to a company's PayPal account. Businesses then have six months to pay it back.
"Who's looking out for small businesses? Someone's going to have to learn how to underwrite for them," Gorlin said. "I think Kabbage will."
Kabbage makes between 6 and 16 percent on the advance, Gorlin said, depending on how long it takes for the business to return the money.
The company will have nine employees on Monday, and Gorlin said he expects to have 15 employees in 60 days. The company launched in beta over the summer and became fully operational in November.
The expansion funding came from venture capital firm BlueRun Ventures, in addition to TPG Capital founder David Bonderman; Stephens, Inc. CEO Warren Stephens; and the UPS Strategic Enterprise Fund.
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