Paperstack provides working capital and financial insights to e-commerce sellers, at a time when both are needed more than ever.

The pandemic spurred a surge in retail digitization, with e-commerce penetration in markets like the US experiencing as much as 10 years’ growth in just three months—a result of brick and mortar businesses coming online, as well as newfound entrepreneurs pursuing a dream, a living, or oftentimes, both.

With rapid growth, e-commerce businesses face the challenge of meeting increased customer demand, while managing their cash flow. The many micro-gaps between buying inventory from suppliers and getting revenue from clients can be crushing to upstart businesses without access to working capital.

That’s where Paperstack comes in. “Small e-commerce merchants have limited access to capital and can't leverage volume discounts, preferred shipping rates, and high costs of influencer marketing to accelerate their businesses beyond that,” says Assel Beglinova, CEO and cofounder of Paperstack. “So we solved that problem by partnering with capital providers to offer affordable working capital.”

Paperstack does this by coupling a strong network of lending partners with its proprietary software, which integrates directly into customers' financial data and allows them to analyze their creditworthiness in real time. “We then work with capital providers to seamlessly fill the need for working capital at affordable rates and flexible repayment terms,” adds Vadim Lidich, CTO and cofounder of Paperstack. “For example, our clients can access capital for just a few weeks to pay off a large inventory purchase, then pay it back from their sales without incurring large interest rates or cash advance fees.”

Additionally, personal guarantees aren’t required, meaning even fledgling e-commerce founders who’ve been in business just six months can qualify for working capital.

This working capital comes atop their original offering of financial insights, which includes visualizations of cash flow, suggestions for inventory optimization, and assessments of marketing impact. With this added resource, e-commerce sellers can now grow more freely, whether it be purchasing additional inventory, investing in advertising, or hiring more talent.

Since the announcement, close to a hundred merchants have expressed interest.

The cofounders are eager to help as many new merchants as possible, in part due to their own experiences breaking into the entrepreneurial space.

Humble beginnings and the power of community

Beglinova and Lidich share a similar path into the startup world: one of challenge, serendipity, and mutual support.

“I’m originally from Kazakhstan and moved to Canada at the age of 18 as an international student,” says Beglinova, who pursued a career in financial planning and advising.

“I immigrated from Ukraine to Canada when I was 17, literally with just one suitcase and very poor English,” says Lidich, who similarly entered finance and wealth management.

However, both founders felt a longing for more impact. “After a few years, I realized I wasn’t exactly changing the world in any particular way. So instead, I decided to quit my job and teach myself code from scratch,” says Lidich, who went on to attempt launching a few other startups.

The two would then serendipitously meet through Tea Club Toronto, an online community founded by Beglinova to connect aspiring entrepreneurs. There, they discovered a shared interest in starting a fintech company to support “solopreneurs” like themselves in a familiar area: finances.

“We didn’t go to target schools; English is our third language; and we don’t have experience in big tech companies. Last but not least, we know that less than 3% of funding goes to women CEOs,” acknowledges Beglinova. “In fact, many investors were not used to dealing with founders who exhibited strong accents or who didn’t come from more traditional backgrounds. But that didn’t stop us.”

Despite these challenges, the two persevered and recently raised a round of pre-seed funding worth $250,000 CAD. The cofounders credit this success to the growth of their network, as well as their participation in the Google for Startups Accelerator: Women Founders program in 2021.

“We faced a lot of challenges going forward, but the reason why we were able to overcome these challenges was the enormous support we’ve been receiving – from our community, mentors, advisors, and clients,” she says. “Google definitely played a huge role. Google got the snowball started.”

Help to grow

The cofounders had heard of Google for Startups Accelerator, but never considered participating until a mentor and Accelerator alumnus prodded them to apply for Google for Startups Accelerators: Women Founders. Upon acceptance into the program, the two were quickly surrounded by mentors, resources, and new ideas.

“The thing we liked about Google for Startups Accelerator was that we could come with our issues. It wasn’t school; it revolved around what we needed,” Lidich notes.

The cofounders were already familiar with Google’s products, having conceived Paperstack in a no-code manner using Google Sheets. “We started building this product completely on Google Sheets,” adds Lidich. “In fact, our first commercial iteration of it was on Google Data Studio, and we were able to monetize it.”

Participating in Google for Startups Accelerator: Women Founders enabled further growth. Mentors connected them to relevant experts – such as the Google Cloud e-commerce team – and introduced them to products like Google App Engine and Cloud Functions, followed by engineering expertise and technical guidance.

“We’re on Google Cloud, and our backend is written in JavaScript, so we’re able to deploy that seamlessly on App Engine and take advantage of features like Auto Scaling,” Lidich adds. “Since day one, we've been trying to stay nimble and iterate on the go. Changes that would normally take weeks to implement now only take us a few days. We've been quite fortunate to receive support from Google's most talented engineers during our time at the Accelerator, allowing us to plan ahead and avoid pitfalls and constraints that many technology founders have to deal with as they scale.”

In addition to the technology, Beglinova highlights the role of networking in the program. “Every week, our mentors asked us how they could help and who we wanted to meet.”

“We’re in the e-commerce space, and what we loved most was the out-of-the-box thinking of the mentors,” she adds. “Mentors would say ‘Oh, did you know that Shopify is a Google Cloud customer? We should connect you with that team!’ And that was invaluable for us. Some mentors even tapped their personal networks; for instance, connecting us to other e-commerce startups that had gone through Google for Startups Accelerator, and we didn’t expect that. They went above and beyond.”

Looking ahead

Fresh off their graduation from the Techstars Equitech Accelerator—a partner of Google for Startups—the team is now in the middle of the FinTech Sandbox Accelerator. As they prepare to speak at New York Fintech Week, the cofounders shared what’s next for Paperstack.

“We want to become a financial platform for merchants around the world,” says Lidich. “There are millions of e-commerce sellers around the world looking for both financial insights and financial resources. Paperstack is in the privileged position to be a trusted partner to many e-commerce sellers already, and we would love to grow with our customers and provide more value to them day to day.”

“We want to create impactful stories,” adds Beglinova. “We’re so happy when we hear that our product was able to help them out. Some of them even want to quit their fulltime jobs to start doing e-commerce full time. These are the stories that fuel us, and we want to do more of this.”

Her advice for aspiring founders?

“If other entrepreneurs are reading this story, wondering whether they should or should not [start their own business], they should,” says Beglinova. “If you’re an immigrant, it should not stop you. If you’re speaking English as a third language and have an accent, hear me out: I could do it, and you could do it, too.”