Industry News
Debanked on SNL
January 28, 2024Saturday Night Live ran an awkward segment last night about debanked. Make sure you watch it until the end.
As a good refresher, the word debanking was ranked one of the top 10 most significant words of 2023 and debank is in the dictionary.
Bluevine Partner Email Circulates
December 1, 2023An e-mail purporting to come from Bluevine’s Partner Notifications account was sent out to about 300 of their resellers yesterday with a plainly stated notice that their Referral Marketing Agreements had been terminated.
A representative from Bluevine confirmed that these notices were legitimate, saying that “we refined our strategy and are moving away from the ISO/reseller model.”
This was followed by the statement that “We will continue to work with a set of select strategic partners to deliver loans to small businesses.”
Bluevine has been making moves as of late. The company relocated its headquarters to Jersey City, NJ earlier this year, launched an Accounts Payable solution in August, and began offering protection of up to $3 million for business banking customers in September.
deBanked Thanksgiving Memes 2023
November 21, 2023It’s Thanksgiving again so you know what that means? Memes! This tradition (which we’ve kept up with as often as possible) started on deBanked in 2012. We hope you have a wonderful holiday and strong end-of-year.
And now, the memes:
See previous year memes:
2022 Thanksgiving Day Memes
2021 Thanksgiving Day Memes
2020 Thanksgiving Day Memes
2019 Thanksgiving Day Memes
2018
2017
2016
2012
Plus, don’t forget to register for deBanked CONNECT MIAMI taking place on January 11 in Miami Beach. This year’s event will feature the first ever Broker Battle!
deBanked CONNECT MIAMI Unveils Inaugural Broker Battle™
November 13, 2023In the span of just a few hours after deBanked CONNECT MIAMI announced BROKER BATTLE, about a dozen brokers entered their names into the contest on the hope that they may be chosen to compete LIVE at the Miami Beach Convention Center on January 11th. Entries will be accepted through December 1st but it may shut off sooner if the broker contestant pool reaches critical mass.
deBanked CONNECT Miami is adding Broker Battle to this year’s lineup of content. The first-of-its-kind event aims to be fun, educational, and serious. The winner of the Battle will earn the distinction of being the Top Broker and win a grand prize of $5,000.
To learn more about Broker Battle and/or enter, CLICK HERE.
To register for the event and make sure you witness history, learn from the experts, and enjoy the extraordinary networking opportunities of deBanked CONNECT MIAMI, CLICK HERE.
Got questions about deBanked CONNECT Miami? Want to sponsor? Email events@debanked.com.
This will be deBanked’s 6th annual event in Miami since 2018. ARE YOU READY?!
BHG Financial Tightening Its Credit Box, Dealing With Tough Environment
November 13, 2023BHG Financial (formerly Bankers Healthcare Group) originated $1 billion in loans in Q3, according to recently filed disclosures about the company. That was down from $1.1B in Q2. BHG mainly provides business loans and unsecured loans to healthcare practitioners. Although the company considered it to be a stronger quarter than anticipated, it predicts that Q4 will not be as strong and that originations will actually drop significantly to between $600M to $800M.
“As we look to the fourth quarter, BHG believes origination volumes will likely be less than Q3 as they continue to shrink their credit box,” said Terry Turner, CEO of Pinnacle Financial Partners, which owns 49% of BHG.
While originations start to slow, loan loss reserves have also increased.
“The decrease in income from BHG during the three and nine months ended September 30, 2023 as compared to the same periods in the prior year is largely the result of increases in (i) the liability for estimated future inherent losses for the outstanding core portfolio of loans sold to banks through the auction platform that may be subject to future substitution due to payment default or prepayment and (ii) the allowance for loan losses for loans BHG has retained on its balance sheet due to the uncertain economic environment.”
BHG is also exiting its “merchant financing business,” according to Pinnacle CFO Harold Carpenter. Carpenter was referring to NaluPay, BHG’s Point of Sale financing division. NaluPay launched a little over a year ago to great fanfare, claiming it would enable merchants “to offer their customers large credit lines, a suite of promotional and non-promotional financing options, and instant credit decisions within seconds.”
Nevertheless, Pinnacle says that BHG is feeling good about the direction things are heading.”BHG is optimistic about credit at the end of the third quarter,” Turner said.
What’s On The Industry’s Desk?
November 3, 2023
“Just personalize your desk for others to recognize your space,” said Maria Pappas, Chief of Sales at Landfall Media Group.
On a typical day, individuals spend eight hours at their desk, another eight attending to tasks after leaving it, and the remaining eight hours asleep. Now this breakdown may vary from person-to-person, but it generally holds true. The office really is like a second home.
For Maryam Raya, an ISO Representative at JRG Funding, she’s currently awaiting the arrival of a piano fixture that she plans to place on her desk. As a professionally trained concert pianist, it will hold special value for her. But she’s got another classical way of jazzing up her workspace as well.
“I also absolutely love flowers and have brought bouquets on occasion to the office,” said Raya. “That’s definitely a personal touch.”
Meanwhile, Sharon Guiliano, COO at Triton Recovery LLC, believes it’s crucial for her to inspire and motivate a positive vision of success to foster a culture of positivity within her company. This is the reason she keeps her workspace with numerous motivational items. Among those is a succulent marble vase representing devotion, growth, loyalty, focus and prosperity. In one corner of her office, she even has a Birds of Paradise plant as a representation of maintaining a positive perspective on life.
“I have motivational items in my workspace that say, ‘Stay Positive, Work Hard, Make it Happen’ and ‘Live in the moment,’” said Guiliano.
For Pappas at Landfall Media Group, she keeps a fidget spinner nearby to divert her from distractions that ironically has turned into a distraction itself. And along with a photo of her kids, she has a lucky duck figurine gifted to her from her daughter displayed in front of her monitor.
“I also have my Nespresso machine for midafternoon to pick me up,” said Pappas. “Most importantly, pictures of my kids for motivation.”
Pappas’ male colleagues struggle to grasp the concept of having mascara readily available but Pappas takes it further by keeping various items within reach at the office, such as a toothbrush, floss, lipstick, and hair ties. Raya of JRG Funding, meanwhile, also always keeps her two essential items within sight. “I always carry lip gloss and a hairbrush,” said Raya. As for Guiliano, in addition to hand lotion and sanitizer, she also has promotional swag on her desk from events she’s attended.
“I do like to keep marketing items I’ve collected through the years from attending the deBanked events,” said Guiliano.
From A to D: How LCF is Aiming High
October 9, 2023
Robert Kleiber was a banker. He started his career at Citi in 2000 and rose up the ranks to become Head of Small Business Banking for North America by 2014. By then times were changing and disruptive fintech technology was becoming the talk of the town. Kleiber saw it firsthand and wanted in. So, he made the daring move to leave Citi in 2016 to go make his mark in the rapidly evolving world of small business finance.
He first served as the CFO of an NYC-based fintech company until another unique opportunity presented itself. It was at a growing company on Long Island that he hadn’t really known that much about previously. The way Kleiber tells it to deBanked, the company had a way of communicating the scale of its aspirations that got him really excited. He went for it. The company was called The LCF Group, a revenue-based financing provider that was headquartered in New Hyde Park. Today, Kleiber is the CFO & COO of the LCF Group. Founded in 2011, the company has solidified itself as a stalwart in what folks often call the “C & D paper” space.
“The goal,” Kleiber reveals, “is to be largest subprime funder by the end of next year.”
That’s a lofty ambition. In an industry oft-filled with big talk and rosy projections, LCF’s trajectory actually appears to support this possible outcome. Between in-office and remote, the company already has approximately 200 employees and it’s been on a hot streak of recruiting talent. Most compelling of all, however, is that LCF recently acquired select strategic assets and licensing rights to a well-regarded name in the industry, Reliant Funding. At the time of the announcement, the company said that “This strategic move not only enhances LCF’s portfolio but also empowers us to offer merchant funding through both ISO partners and directly under the LCF and Reliant brands.”
“On the direct side, our plan is to build up Reliant on originations […] and get them back to where they were before,” Kleiber says.
In that regard, LCF fully intends to leverage the Reliant name back into a powerhouse funding arm in the prime paper arena, first by going direct to merchant and then by taking on ISO/referral business for it. Between its two brands then, the company is on its way to covering the gamut from A – D. Unsurprisingly, all of this activity requires strong technology to make everything work. Kleiber says that they have 20-25 developers constantly building out their systems, which they rely on to not only increase the speed in which they can approve deals but also to achieve maximum compliance.
“We take compliance super serious,” Kleiber says. “Our differentiator is transparency, operating above board.”
LCF’s new Director of Sales, Jason Redding, who previously spent ten years at OnDeck, echoes same. “Even though it’s C & D paper, we’re doing this the correct way,” Redding says. Redding, who experienced the incredible ride at his former employer from startup to IPO and beyond, explains that LCF is giving him a similar feeling of what that journey was like. “Being part of something like that again is something I’m looking forward to,” he says.
And yet when it comes down to product, the company is perfectly content for the time being to focus on what they’re good at, which is revenue-based financing through and through. They’ve determined it’s better to lean in and try to be the best at something rather than try to offer too many different things.
At the LCF office in New Hyde Park, one can find various departments working to carry out the company’s mission. Among the introductions and small talk made during a walkthrough, one line uttered by a veteran member of their team stands out. “In this industry you don’t have to be earth shatteringly different, just operate with honesty, integrity, and transparency, and success will follow.”
Experts: How GFE Went Big
September 6, 2023The Brewster Building is an icon in Long Island City, a bustling district of Queens that’s right across the water from Manhattan. Most people know the building as the official headquarters of JetBlue because their giant logo on the roof can be seen from miles away. Others identify it as a major corporate hub for The Estée Lauder Companies since they sublease a substantial amount of office space inside. But up on the eighth floor, men and women traversing the hallways in suits work for another employer that’s making a splash in a different industry altogether. The sign on their door says GFE, which is short for Global Funding Experts. It’s a company that provides working capital to small businesses nationwide and they just recently secured a senior debt facility of up to $100 million.
Boris Musheyev, GFE’s CEO, founded the company almost a decade ago with partner Viacheslav “Steve” Eliyayev. Musheyev was working mainly in real estate when he learned about an innovative way to support small businesses by purchasing their future receivables. A cautious investor, he didn’t just jump right in. Instead, he bided his time with research on how it worked. He crunched numbers and analyzed the risks before he was confident it was something he wanted to do.
“From the outset, I’ve only channeled funds into ventures I wholeheartedly believed would both succeed and offer genuine value,” Musheyev told deBanked. “This commitment was evident in 2013 when we began by investing our capital.”
Alas, Global Funding Experts was born. The company’s model is referral partner driven, meaning they rely on ISOs for submissions and there’s no internal sales force. Today, GFE has an estimated 1,500 ISOs signed up and they receive about 700 applications on an average day. It’s a level of scale that wouldn’t be possible if they didn’t have an efficient CRM, something Musheyev predicted the necessity and utility of long before. GFE began building its own proprietary CRM in 2017 and the company used that to accelerate growth beyond its early startup days.
With its momentum, GFE brought on Boris Shakhmurov to serve as COO in 2019, a traditional banking executive with 20 years experience. Shakhmurov was previously an Executive Director at JPMorgan Chase and had overseen mainly cybersecurity, technology controls, and compliance before making his move to GFE. The two Boris’s knew each other previously, having been friends for over 30 years already. At GFE, Shakhmurov’s pitch that “banks don’t lend to small businesses” lands differently given his background.
“As an expert in Governance, Risk, and Compliance, when I joined the organization in 2019, our goal was to establish a best-in-class MCA Operational Resilience framework to address current and future challenges facing our industry,” Shakhmurov said. “With a focus on building strong and resilient operational controls, we used a multidisciplinary approach to assess the risk across all of our information assets and business processes. The Zero Trust and Defense-in-Depth approach enabled us to focus on early detection, rapid response, enhanced protection, and reducing single points of failure throughout the entire MCA lifecycle.”
For all the technical talk, Shakhmurov said what really stands out is the firm’s family-like atmosphere, which one can see for themselves in their spacious office. That environment has been achieved all while tightly controlling and compartmentalizing access to data, the company says. Security is paramount.
With the infrastructure in place, GFE hired Jonathan Mayer to be their CFO, a veteran accountant who previously spent more than 10 years at Grant Thornton LLP. Mayer first met Musheyev and Shakhmurov in 2021 and he echoed a similar sentiment about how he ended up at GFE. “The work ethic and trust and family environment really stood out to me,” Mayer said.
Between Musheyev, Eliyayev, Shakhmurov, and Mayer, the firm was then off to the races, ultimately leading up to the securing of a debt facility last month of up to $100 million. A lot went into making that happen, including the enlistment of a well known industry law firm to perform the due diligence, they say.
“Through consistent communication with our merchants and operational adaptability, we’ve not only met but surpassed our profitability benchmarks, all the while ensuring minimal defaults in our portfolio,” Musheyev said.
The company also credits having a qualified CFO and robust CRM technology as being necessary ingredients to getting a serious deal done. GFE’s signature products include purchases of future receivables, reverse consolidations, and more recently something called “Incremental Funding.” There’s also no commission clawbacks, they tout. Overall, GFE has funded over $400 million in capital to small businesses since inception.
The executive team heaped praise on the staff for being integral to their success.
“What we have is trust,” Shakhmurov said, who comes back again and again to the importance of building a business that will endure. “If you look at the banking industry, you need operational resilience,” he said.
