Archive for 2020
Discussion: The State of The Industry With Matthew Washington at PIRS Capital
July 9, 2020I recently connected with Matthew Washington, the Chief Revenue Officer of PIRS Capital to get his take on the state of the industry right now and whether or not there are opportunities in the market. Video below:
Funding Circle US Lays Off 120 Employees
July 9, 2020Funding Circle US laid off 120 employees yesterday, according to a post shared by Ryan Metcalf, Head of U.S. Regulatory Affairs and Social Impact.
Reuters reported that the company will also centralize its technology development in the UK rather than have a separate US team going forward.
The US operation had largely been focusing on PPP lending and SBA 7(a) loans since the shutdowns occurred.
The announcement coincided with its UK business being approved to participate in the Bounce Back Loan Scheme.
Breakout Capital Weathered The Storm And Came Out With Expanded Access to Credit
July 8, 2020
Breakout Capital never stopped funding. That’s what CEO & President McLean Wilson recently shared with deBanked. The company not only weathered the storm but has come out with expanded access to credit totalling $20MM with Medalist Partners, one a current term loan facility and the other a new term loan facility with “attractive” forward flow features.
The company said in its announcement that these facilities will allow Breakout to increase loan originations across all of its product offerings, including its term-loan product, FactorAdvantage®, and its newest factor product, FactorBridge.
“Small businesses are at the core of our economy and they were, as we were, largely blindsided by recent economic interruptions,” Wilson told deBanked. “We adapted quickly and rolled with the punches and never stopped funding. It is a testament to the resiliency, loyalty and borrower first mentality that Breakout Capital has not only weathered the storm, but has strengthened our company throughout the past few months. We quickly adapted to a new way of thinking, which helped us serve our clients in real time and forge ever closer relationships with our factor partners, lenders, online marketplaces, ISOs and borrowers.”
John Slonieski, Director of Private Credit for Medalist Partners, said in the announcement that “We are pleased to enhance our relationship with Breakout Capital in our asset-based lending strategy. Their high-quality underwriting and SMB-friendly lending solutions, coupled with their talented credit and management team, provide us confidence as we continue working closely with them to successfully scale their lending program.”
Breakout Capital Closes $20MM in Credit Facilities with Medalist Partners
July 8, 2020MCLEAN, VA / July 8, 2020 / Leading nationwide small business lender Breakout Capital announced today the completion of two senior secured credit facilities, totaling $20MM, with Medalist Partners, expanding and extending a current term loan facility and establishing a new term loan facility with attractive forward flow features with its long-time lending partner. This expansion of its successful ongoing partnership with Medalist further validates Breakout Capital’s vision and growth through product differentiation, innovative responses to small business needs and disciplined, long-term strategy. These facilities will allow Breakout to increase loan originations across all of its product offerings, including its highly regarded term-loan product, FactorAdvantage®, and its newest, well-received factor product, FactorBridge.
“I am pleased to continue our successful relationship with Medalist Partners. Medalist is a disciplined and engaged credit facility provider who shares our vision and believes in the strong value we bring to small businesses across the country,” said McLean Wilson, Breakout Capital’s CEO and Chief Credit Officer. “The expansion of this strategic relationship will accelerate the growth of our “white-hat” brand and the continued introduction of innovative new lending solutions to the market.”
John Slonieski, Director of Private Credit for Medalist Partners, added, “We are pleased to enhance our relationship with Breakout Capital in our asset-based lending strategy. Their high-quality underwriting and SMB-friendly lending solutions, coupled with their talented credit and management team, provide us confidence as we continue working closely with them to successfully scale their lending program.”
Given the deployment of these Medalist facilities and increased market demand from the rollout of FactorBridge and expansion of FactorAdvantage®, Breakout Capital has in parallel raised its loan size up to $1,000,000. It has done so while continuing to offer loan terms of up to 24 months, offering flexibility through FactorBridge to provide shorter-term solutions that bridge to these longer-term Breakout Capital loans.
“The increase in our maximum term loans provides much-needed additional liquidity to small businesses, enabling them to implement critical strategies and capitalize on time-sensitive opportunities during these unprecedented times,” Wilson stated. “It also facilitates powerful dual factoring-loan solutions where we provide critical working capital loans to SMBs in tandem with accounts-receivable based factoring platforms offered by our valued factor partners.”
About Breakout Capital
Breakout Capital, headquartered in McLean, Virginia, is a leading fintech company, offering innovative small business lending solutions across the country. Breakout Capital is committed to transparent and responsible lending solutions through product innovation, small business borrowing education, and advocacy against predatory lending practices and continues to empower small business through right-sized lending, suitability testing, improving terms and supporting the long-term financing objectives of small businesses.
About Medalist Partners
Medalist Partners is an SEC registered investment manager with approximately $2.4 billion in assets under management as of June 30, 2020. The New York based firm manages strategies in asset-based private credit, structured credit, and collateralized loan obligations. The business is led by partners Greg Richter, Brian Herr and Michael Ardisson, who were formerly part of Candlewood Investment Group and prior to that Credit Suisse.
Every Business That Got $150,000 or More in PPP Funds (The List)
July 7, 2020In the interest of transparency, the SBA dumped a list of more than 660,000 businesses that got $150,000 or more in PPP funding.
You can download the entire thing right here.
Keeping Up With The Winklevii
July 6, 2020
Spending the previous three and a half months indoors, locked away from others, and sat at homebound desks have had differing effects on everyone. Some have had a period of intense productivity, some have fallen into bad habits, and some have spent an inordinate amount of time on social media. The Winklevoss twins, famous for playing a role in the founding of Facebook, are of the latter sort.
Cameron and Tyler, aged 38, are two entrepreneurs with a particular focus on cryptocurrencies. Having experimented with social media in its early days with Mark Zuckerberg at Harvard, the pair later sued the Facebook CEO in 2008, the same year they rowed for the USA in the Beijing Olympics. From here the twins went into venture capital; led a seed-funding round for BitInstant, a Bitcoin payment processor; claimed to have accumulated 1% of all Bitcoin by 2013 between them; and launched Gemini, their own cryptocurrency exchange, in 2014. Since then, as Bitcoin’s value has surged and fluctuated, the pair have become figureheads for the cryptocurrency, having been proponents of the decentralized currency from the days when it was worth less than $10, to its highest valuation in 2017 at just below $20,000, to its current price of just over $9,000.
And with quarantine providing all the time in the world to ponder the future of Bitcoin, the twins have been posting daily on Twitter about the crypto, relating it to any and all topics that proved popular. Cancel culture? There’s a tweet for that. George Orwell’s magnum opus, 1984? There’s a tweet for that. Vaccinations and their alleged comparability with cryptocurrency? There’s a tweet for that.
Beyond comparing and relating Bitcoin to everything that comes up in the news cycle, the twins brought up an idea a number of times on social media over quarantine: that the pandemic has set the stage for a decentralized world.
While it is clear that this has happened to a point already, given the global move toward working from home, Cameron believes it will go further, mentioning in a tweet that the pandemic will be “an inflection point for Bitcoin and the Metaverse.” Choosing not to expand on this lofty statement, the specifics of Cameron’s claim can’t be known for sure, but the idea behind the Metaverse, a collectivized virtual space based off the setting of a 1992 sci-fi novel which is capable of replacing the functions and opportunities granted by the real world, is one well suited to Bitcoin, or, at least the idealized vision of what Bitcoin could become.
As well as this prophesizing of a virtual utopia, the brothers displayed an intense distrust and paranoia of government, currencies that are regulated by centralized banks, and the role of big tech. With tweets criticizing the Federal Reserve’s decision to inject $1.5 trillion into the economy, YouTube’s ongoing debate over whether the First Amendment applies to a private business, and warnings against the threat of a government willing to grab more power during a pandemic, the billionaires’ tweets appeared at times to reach Elon Musk’s recent anti-government messages via Twitter.
With the twins having noted their disappointment in the US government earlier in the year at a conference in January, that time regarding the government’s slow adoption of cryptocurrencies, it is not so much of a surprise to see these further critiques, especially with them largely taking aim at the government’s employment of federally printed money, or “toilet paper,” as they call it.
All this being said, the twins appeared to be just like everyone else during quarantine: left with not much to do with a stable internet connection and a charged phone. And so conspiracies and cryptocurrencies aside, the brothers also made time for the irreverent and the relatable, posting about the possibility of a Groundhog Day-style scenario during quarantine as well as the importance of “sunsets, the stars, and true friends” in a tweet that wouldn’t be amiss in a Disney film.
Ultimately though, the sooth-saying and future-gazing done by the Winklevii in quarantine will take years, if not decades, to come about, if it ever does. One thing is certain though, the twins won’t stop talking about it until then.
The State of Securitizations in Alternative Lending
July 6, 2020Over the last few months, “securitizations” were frequently cited as a reference point for the health of a small business lender or alternative finance provider. Given the vague information and inferences that circulated, I decided to schedule a chat with Methodical Management co-founder Gunes Kulaligil to get his perspective. Our discussion on the state of securitizations in alternative lending below:
Google Pay Launches SMB Loans in India, Plans to Expand American Features
June 30, 2020
This week Google announced that it is expanding its service offerings in India, with small and medium-sized businesses in the country now being able to apply for loans via the Google Pay for Business app. The result of partnerships with banks, Google also announced that it will be rolling all of its SMB-related services into one platform; these include Google My Business, an app that allows owners to make a business profile and get a Google Maps listing; and Google Pay Spot, which lets entrepreneurs customize their digital storefront, as seen by customers in the Google Pay app.
This is just the latest of features released in India by the tech giant, with it launching the ability to transfer money between Google Pay users earlier this year. What makes this interesting though is that in a recent interview with Business Insider, a Google spokesperson noted that the company’s decisions in global markets have become increasingly more influenced by its trialing of new features in India.
“We’re always trying to understand and learn from changing consumer behaviors worldwide so we can build more helpful features,” the spokesperson explained. “Our learnings from Google Pay in India will enable us to make digital money experiences simple, helpful, and accessible and create new economic opportunities for both users and our partners around the world.”
So does this mean Google will soon be joining the likes of Square and Clover and begin offering funding to American small businesses? The future is not so clear, but with the company announcing two weeks ago that it plans to incorporate digital storefronts into Google Pay, serving as an in-app portal to purchase goods, it appears that long-time features of the Indian version are beginning to bleed into the American counterpart.
Having announced its intentions to offer checking accounts in 2020, and with leaks earlier this year pointing towards a Google Pay debit card, it appears as if Google is following in the steps of its rival, Apple, and wading further into the financial services sector.
