Letter From the Editor – Jan/Feb 2016January 1, 2016 | By: Sean Murray
2016 is here and the world of alternative finance isn’t slowing down. If you’re a commercial finance broker, the environment has gotten a little bit more competitive. Sorry folks, the Ferrari might have to wait, at least that’s what some of the sources we interviewed are saying.
But it’s not all bad, the path to success is just changing. Cold calling and direct mail are giving way to new ideas such as Times Square billboards, referral relationships, and diversified product lines. Along the way, regulatory compliance is permeating thought processes more than ever before. The SBFA (formerly NAMAA) is evolving and other groups are trying to make their presences felt as well.
Certain models may be tested by rising interest rates in 2016. Investors in marketplace lending may be wooed by safer investments that pay out a smaller, yet acceptable yield. Or perhaps a volatile or declining stock market will encourage more investors than ever before to flock to marketplace lending. Several predictions made by the “experts” in 2015 will be tested. It’s amazing to think that we really haven’t had economic or market conditions change in a long time.
The fact that it’s a presidential election year could also stir things up. Democratic contender Bernie Sanders for example, has pledged to wage war on lenders by instituting nationwide interest rate caps to levels that would likely cripple both marketplace lenders and credit card companies.
With all of these things to consider, perhaps the two guys that lost God and found $40 million (as told in Bloomberg this past October) are better off retired on a beach in Puerto Rico. Then again, we’ve got a more compelling story in this issue with two guys from somewhat similar circumstances. Jared Feldman and Dan Smith, co-founders of Fora Financial, sold a part of their company to Palladium Equity Partners LLC late last year. Fora fittingly means marketplace in Latin and the pair still run the company from New York City. The two entrepreneurs are featured on this issue’s cover and should serve as a reminder to anyone reading, that the industry has so much more room to grow.
–Sean MurrayLast modified: May 7, 2016
Sean Murray is the founder of deBanked, a 10-year veteran of the merchant cash advance industry, a casual Lending Club and Prosper investor, the co-founder of Daily Funder, an alternative lending speaker, consultant, writer, and enthusiast. Connect with me on LinkedIn or follow me on twitter.