Bags lands $2.75m to scale AI-driven financial reviews for small businesses
December 9, 2025
Bags, a U.S. FinTech focused on small-business finance, closed a $2.75m round led by the Ford Foundation, with participation from Partnership Fund for New York City, Zeal Capital Partners, Slauson & Co, Limited Ventures and Blueprint FTC. Existing backers include Connecticut Innovations, the Howard Schultz Family Foundation and Swanston Labs. This brings total funding to $7m.
The company blends AI-driven financial reviews with human expertise to help small firms clean up books, surface missed expenses and present lender-ready financials. It packages that into CFO-level reporting, strategic support and connections to over $10bn in available credit.
Why finance leaders should care
- Cleaner borrower data lowers friction in underwriting and reduces back-and-forth on documentation.
- Standardized reports can speed up credit decisions and improve portfolio quality for lenders and CDFIs.
- AI-first reviews catch basic errors early, freeing analysts to focus on signal, not cleanup.
Product focus
- AI-powered bookkeeping insights with explanations and suggested fixes.
- CFO-level reporting to clarify performance, cash needs and debt capacity.
- Loan packaging support to improve completeness, accuracy and timing.
Early traction
According to Bags, firms on the platform grow on average 250% year over year, are 4.5x more likely to secure funding and receive financing five times faster than the national average. The company recently launched free AI financial reviews to flag errors, likely causes and actionable next steps.
Distribution and partnerships
New capital will expand the product suite and deepen partnerships with mission-driven lenders and Community Development Financial Institutions (CDFIs). Bags plans to broaden pilots with CDFIs and Minority Depository Institutions (MDIs) in 2026 to improve how borrowers prepare, package and manage loans. For context on the sector, see the U.S. Treasury's CDFI Fund.
What this means for lenders and CDFIs
- Underwriting inputs: Expect cleaner P&L/BS, consistent categorization and fewer unsupported adjustments.
- Cycle time: Tighter files can shorten origination timelines and reduce touches per deal.
- Risk: Better visibility on margins, seasonality and cash conversion may improve early warning and covenants.
- Operations: Potential to reallocate analyst hours from reconciliation to forward-looking analysis.
Voices from the field
Daniel Taylor, CEO of Bags: "We're changing the way small businesses think about money. By combining AI financial reviews, CFO level reporting, and access to over $10 billion in available credit, we help entrepreneurs become stronger operators and grow their businesses with confidence."
Maria Gotsch, president and CEO at Partnership Fund for New York City: "By equipping small businesses with better financial management tools, guidance and access to debt capital, Bags is helping a critical part of our economy remain competitive and financially resilient."
Company snapshot
Founded in 2020 by Daniel Taylor, William Hayden and Ignacio Semerene, Bags' aim is straightforward: make sure small firms aren't held back by messy books or incomplete files, but have clean data and the support to grow.
Practical next steps for finance teams
- Pilot a "clean file" requirement with a subset of borrowers using AI-assisted reviews to measure time-to-close and approval rate lift.
- Benchmark your current time-to-funding and package completeness; track deltas after introducing standardized reporting.
- Integrate AI review outputs into your document checklists to preempt common variances (uncategorized expenses, missing statements, cash vs. accrual mismatches).
Exploring the broader AI toolset for finance workflows? Review curated options here: AI tools for finance.
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