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Clearbanc co-founder Michele Romanow speaks in San Francisco in 2019.STEVE JENNINGS/AFP/Getty Images

Michele Romanow’s startup Clearco has raised fresh financing – including from the Dragons’ Den star herself – and hired a new chief financial officer as the e-commerce financier attempts to bounce back from a string of recent setbacks.

Clearco, officially known as CFT Clear Finance Technology, revealed in a Canadian securities filing this month that it has raised US$17.1-million, which includes a combined US$6-million from Ms. Romanow, the Toronto company’s chief executive officer, and her co-founder, former romantic partner and previous CEO Andrew D’Souza, now chairman.

Ms. Romanow said in an interview the funding, in the form of a convertible promissory note, represents the first close of what is intended to be a US$30-million financing from existing investors. The pair received an undisclosed sum for part of their stakes last year when Japanese giant SoftBank Group Corp.’s Vision 2 Fund led a US$215-million financing of Clearco.

“When founders really care about their company and markets change very quickly, we double down on what we have built,” Ms. Romanow said, adding the pair and other existing investors “are still very supportive and bullish on the company. I would not characterize this as an emergency in any way.”

“We obviously believe in the future of the company, we are seeing this has been a tougher market, and we wanted to put our own support behind this and really stepped up to show that.”

The company has also hired Vasili Gerogiannis as its CFO, replacing former tech investment banker Curt Sigfstead, who left early this year to join B.C. legal technology startup Clio. Mr. Gerogiannis was most recently chief capital officer with publicly traded online lender OppFi Inc., where he worked for nearly five years. He previously served as vice-president with BMO Capital Markets’ securitization group in the United States.

The Chicago-based CFO started last week. “We did a thorough search and found someone we really like who is really strong and has made an impact in his first week,” Ms. Romanow said.

His predecessor’s exit was one of a slew of senior executive departures from Clearco this year, which preceded the layoff of 125 employees, or one-quarter of staff in late July. Earlier that month, Clearco, which provides cash advances to e-commerce merchants that they pay back from subsequent revenues, had cut originations for new advances for a week to tighten up its pricing and underwriting given the deteriorating economic and credit environment.

Then in late August, the company retreated from foreign markets – particularly Europe – and shed more staff to focus on Canada and the United States.

Clearco this year also hired U.S. fintech investment bank Financial Technology Partners, headed by deal maker Steve McLaughlin, to explore strategic options, including fresh financing or the potential sale of the company. Ms. Romanow declined to comment on how the process was going.

Clearco’s latest low-profile funding is in sharp contrast to the boom times of recent years when big financings were announced by fast-growing startups, including the Toronto company, with splashy releases that heralded round sizes and, often, their achievement of “unicorn” status – a valuation of US$1-billion or more. Many other companies this year in Canada and elsewhere have also quietly tapped existing investors to continue funding their unprofitable operations as they attempt to shift quickly from a “growth-at-all-costs” mentality to a more accelerated path to breaking even. Often the financings are done with little or no public fanfare.

Clearco raised the financing on the heels of a US$60-million financing this past spring by the company, which was primarily but not exclusively funded by existing investors. The company also concluded that funding quietly.

By choosing to proceed with a promissory note, Clearco is raising a form of convertible debt that does not establish a new valuation for the company. Asked if she thought Clearco was still worth more than US$2-billion (its valuation at the last financing) given tech valuations have fallen steeply this year, Ms. Romanow replied: “I don’t think anyone is worth what they were six months ago. I don’t think anyone is immune to market comparables. Generally everything has fallen.”

But she said the company has benefited from the tough decisions it made this year and that its shift to funding businesses with better credit quality and being more disciplined with funding decisions for customers had been “positive for the business.” She added the company has “not seen a meaningful uptick in North American defaults,” as was the case in Europe before it pulled out of the market, although bank financing for the company’s e-commerce entrepreneurs “has dried up.”

Bay Street online newsletter OPM Wire first reported news of the securities filing.