TransFS, a Chicago-based start-up that helps small businesses compare credit-card processors, has raised $510,000 in its first round of funding.

TransFS was launched in the spring of 2009 by Sean Harper and Joshua Krall, classmates at the University of Chicago’s Booth School of Business. The company provides a comparison shopping Web site for credit-card processors, including ratings, reviews and explanations of how contracts work.

TransFS also runs reverse auctions where small businesses get bids from credit-card processors. This is designed to help small businesses save money on credit card processing fees.

Four investors participated in the fundraising round, led by Chicago-based Hyde Park Angels and 500 Startups, a Mountain View, Calif.-based firm that focuses on early-stage investments.

Harper said he and his team decided to raise money at the beginning of the year and “went out to meet every investor that we could.”

TransFS also benefited from its participation in Excelerate, a Chicago-based program that awards funding to start-ups and provides mentorship from experienced investors and entrepreneurs. TransFS was one of 10 companies selected for Excelerate’s inaugural class of start-ups this summer.

“There are investors coming through Excelerate every day,” Harper said, adding “the people behind it have awesome networks.”

Harper said TransFS will use its newly raised money for online marketing efforts. The company also will expand to offer comparison shopping for other financial products used by small businesses.

“We see the development of a business like this as being a series of experiments,” Harper said. “First you run the experiment of asking people and seeing if this is a good market. Then you run the experiment of building the product …  and figuring out if some people will use the product, making the product fit the users. … The next thing is the experiment of: ‘Can we tell enough people about it to make it a profitable business?’ “