Why We Invested In Parafin

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I am excited to announce that Notable Capital is leading Parafin’s Series C funding and partnering with the team to support their mission of empowering small businesses at scale by offering embedded financial solutions.

Small businesses are the backbone of the U.S. economy and are integral to economies around the world. They generate nearly half of the U.S. GDP and employ over 60 million people. Yet, despite their critical role, these businesses remain underserved when it comes to capital and financial tools.

Traditional banks often rely on systems that leave modern SMBs—like DoorDash restaurants or Amazon sellers—locked out of the financing they need to scale. This gap in financial services represents not just a problem, but an enormous opportunity. Enter Parafin. 

The Solution: Embedded Finance That Works for Everyone

Parafin unlocks access to capital by embedding financial products directly into the platforms where merchants already operate. Using real-time transaction data, Parafin underwrites loans quickly and accurately, creating a win-win-win solution:

• Merchants: Frictionless, fast access to capital to fuel growth and manage cash flow.
• Platforms: Third-party financing that drives merchant growth, loyalty, and retention—while opening up new revenue streams.
• Parafin: Near-zero customer acquisition costs (the merchants are already there), enabling scalable and cross-platform growth

Like how Square Capital leveraged transaction data for merchant sales for Square customers, Parafin’s embedded approach works across platforms, verticals, and geographies, making it the natural evolution of SMB financing for the mobile-first, platform-driven economy.

The Team: The Right People To Solve This Problem

We first met Sahill Poddar and the Parafin team four years ago, just as they were leaving Robinhood to build something of their own. At Robinhood, Sahill and his co-founders were instrumental in building and scaling machine learning systems—democratizing finance for millions of consumers.

That same expertise now powers Parafin’s underwriting model. By analyzing billions of real-time data points from platforms, Parafin can provide financing smarter and faster than anyone else.

This technical edge is incredibly hard to replicate. It’s why giants like Amazon, DoorDash, and Walmart trust Parafin with their merchants. These signals are a clear indicator of Parafin’s ability to execute and scale.

Outside of their technical and strategic expertise, Sahill and his team bring deep empathy for small businesses—many of whom are overlooked by traditional finance. That combination makes Parafin uniquely suited to solve this problem at scale.

Why We’re Excited To Invest

Parafin’s growth so far has been nothing short of remarkable. They’ve facilitated over $1 billion in financing annually, with conversion rates that are unheard of in both e-commerce and lending. And yet, they’re just scratching the surface with a massive opportunity ahead.

What excites us even more is Parafin’s vision to go beyond lending. Small businesses don’t just need capital—they need tools to manage it. With plans to launch wallets, cards, and additional financial services, Parafin is on its way to becoming the essential financial layer for merchants everywhere, embedded where they already manage their businesses.

We couldn’t be more excited to back Sahill and the Parafin team as they continue to unlock growth for SMBs, platforms, and the digital economy.

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