# Now Financial Model

Payment acceleration platform that pays B2B SMBs immediately for their invoices, funded via a municipal bond securitization structure.

- Canonical: https://finamodel.com/startups/now
- Excel download: https://finamodel.com/startup-models/now.xlsx
- Category: Fintech
- Model type: SaaS ARR / Valuation
- Funding round: Series A
- Funding: $29M
- Founded: 2021
- Geography: United States (U.S. SMB market explicitly referenced). [DECK, slide 6]
- Customer: B2B

## About the company

Now accelerates B2B invoice payments, allowing SMBs to receive funds immediately instead of waiting for customers to settle invoices. It is funded through a municipal-bond securitisation structure, giving the product a specialty-finance rather than SaaS profile.

The service is intended to feel simple for a business customer while monetising the gap between an invoice-acceleration fee and the cost of capital. Invoice quality, repayment timing, and access to funding are central to the commercial model.

The model should forecast eligible invoice volume, funded invoices, average advance duration, acceleration fee yield, and repayment performance. Average funded balance, bond coupon, credit losses, servicing expense, and warehouse or securitisation capacity should be explicit drivers of profitability and cash.

## What's included

- 5-year monthly revenue build with stage-appropriate growth assumptions
- Full P&L, headcount plan, and operating-expense schedule
- Cash-flow statement, runway, and burn-rate tracking
- Valuation via exit multiple with a DCF cross-check
- Returns analysis with MOIC and IRR
- Unit economics including CAC, LTV, payback, and cohort retention

## Product & value proposition

NowAccount lets credit-approved SMBs (revenues $500K–$50M) get paid within 1 day on outstanding invoices without taking a loan or factoring.

Mechanism:
1. SMB delivers goods/services and invoices their customer.
2. SMB opts in to NowAccount to accelerate payment.
3. Now pays the SMB within 1 day.
4. Now manages the invoice and waits for the end-customer to pay.

Risk mitigants: AR is trade-credit insured; SMBs must be credit-approved; portfolio has experienced minimal write-offs. Funded via an innovative municipal bond securitization structure with authorized capacity supporting >$600M in annual transaction volume.

Positioning analogy: "feels like accepting a credit card for payment" - shifts B2B trade-credit funding from SMB balance sheets to capital markets, mirroring what credit cards did for B2C.

## Market

- TAM proxy: U.S. small-to-middle-market B2B companies (revenues $500K–$50M) generate >$10 trillion in accounts receivable annually.
- Bond capital structure supports >$600M in annual transaction volume (current authorized capacity).
- No explicit SAM, SOM, or market CAGR figures provided.

## Revenue model

Not explicitly stated in deck. Inferred structure:
- Discount / acceleration fee charged to the SMB on the face value of accelerated invoices (analogous to merchant discount rate or factoring fee), likely expressed as a % of invoice value. Rationale: product is positioned as "feels like a credit card" and the company earns a spread between the fee charged to SMBs and the cost of bond-funded capital.
- Yield on the AR portfolio is the gross revenue line; cost of funds (municipal bond coupon) is the primary cost. Net interest margin / spread is the economic engine.
- Channels: direct (nowcorp.com); no channel partners mentioned.

## Traction & metrics

- Authorized bond capital supports >$600M in annual transaction volume.
- Portfolio write-off rate: "minimal."
- Founded: 2010.
- No revenue figures, customer counts, invoice volumes, growth rates, or retention metrics disclosed in the deck.

## Competition / moat

Moat claims from deck [slide 6]:
- Trade-credit insurance on AR (limits non-payment risk).
- Credit-approved SMB origination (screens borrower quality at source).
- Municipal bond securitization structure (differentiated, lower-cost funding source vs. bank lines or traditional ABS).
- Minimal write-off track record.
- Timing advantage: traditional banks have retreated from small/middle-market, creating a demand gap.

## Team & funding ask / use of funds

- Team: cofounders described narratively (slide 3); names not extracted from text. Link to team page at nowcorp.com referenced.

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## Recommended financial model

- **Archetype + why:** Specialty finance / receivables-acceleration P&L model - structured like a non-bank lender/factor.
  Core economic engine is: (Invoice volume funded) × (acceleration fee %) − cost of funds (bond coupon × avg balance) − credit losses − opex = net income.
  NOT a standard SaaS ARR or DTC model. Closest analogues: factoring company P&L, consumer finance company NIM model, or marketplace-lending income statement.

- **Forecast horizon & granularity:**
  Monthly for Year 1–2; quarterly for Years 3–5. Five-year horizon appropriate given capital-markets funding structure and SMB credit cycle exposure.

- **Key drivers & assumptions:**

| Driver | Value |
| -- | -- |
| Target market AR pool (U.S. SMB B2B) | $10 trillion/year |
| Authorized bond capacity (annual transaction volume) | $600M |
| SMB revenue band (target customer) | $500K–$50M |
| Acceleration fee (% of invoice face value) | 2–4% |
| Average invoice term (days outstanding) | 45–60 days |
| Portfolio turnover (annual turns = 365 / avg term) | ~6–8x |
| Cost of bond funding (annual coupon) | 5–7% |
| Credit loss / write-off rate | <1% |
| Trade-credit insurance premium (% of AR) | 0.3–0.8% |
| SMB customer count ramp | - |
| Avg invoice size per SMB | - |
| CAC | - |
| Opex (headcount, tech, compliance) | - |

- **Scenarios (Base / Bull / Bear - which variables flex):**
  - Base: acceleration fee 3%, loss rate 0.5%, bond cost 6%, utilization of authorized $600M capacity reaching ~50% by Year 3.
  - Bull: fee 3.5%, loss rate 0.2% (strong insurance cover), capacity expanded via additional bond tranches, faster SMB acquisition.
  - Bear: fee compression to 2% (competitive pressure), loss rate 1.5% (insurance shortfall), bond markets tighten → higher funding cost, slow customer ramp.

- **Required sheets / outputs:**
  1. **Assumptions** - all drivers centralized, tagged /.
  2. **Volume model** - SMB count × avg invoice volume → gross invoice flow → funded AR balance (rolling).
  3. **Income Statement** - fee revenue, interest/funding cost, insurance premium, credit losses, opex → EBITDA → net income.
  4. **Balance Sheet** - AR portfolio balance, bond liabilities, equity.
  5. **Cash Flow** - operating CF, bond draws/repayments, net cash.
  6. **Capacity utilization** - authorized $600M bond capacity vs. actual funded volume.
  7. **Scenario toggle** - Base / Bull / Bear switcher.
  8. **Summary / KPIs** - NIM (net interest margin / spread), loss rate, portfolio yield, funding cost, utilization %.

## Frequently asked questions

### Is the Now financial model free?

Yes. The Now model is a free Excel download with live formulas.

### Can I change the assumptions?

Yes. The workbook is editable and its live formulas recalculate when assumptions change.