Archive for 2021
Reliant Funding Announces Steve Kietz as New CEO
August 10, 2021Industry veteran and former Chief Marketing Officer is appointed Chief Executive Officer of the leading alternative finance company
San Diego, CA (August 10, 2021) – Reliant Funding, a leading small business finance company, today announced that it has named Steve Kietz to the role of Chief Executive Officer. Kietz previously served as the firm’s Chief Marketing Officer. The industry veteran will guide Reliant Funding on its mission to continue providing world-class, customized finance solutions for American Small Businesses.
As CMO, Kietz was instrumental in expanding Reliant Funding’s marketing, risk and technology initiatives. He is a seasoned financial services professional with a more than 30-year track record of leading successful teams and is widely recognized as an industry leader in cultivating strategic partnerships. Prior to joining Reliant, Kietz served as President of Inte Q, was Founder and CEO of Mobile Money Ventures (which was acquired by Intuit), and held leading roles at Citi and JP Morgan, including President of Citibank Direct. Outside the profession, Kietz has volunteered as Vice President of the Familial Dysautonomia Foundation for over 30 years.
Commenting on his appointment, Kietz said, “I’m excited and grateful for the opportunity to lead Reliant Funding into a new era, where we are positioned as industry leaders in delivering value to our customers. The company has a long history of providing outstanding financial solutions to small businesses and I am deeply humbled to continue this legacy. I am excited to lead a team of great people and I look forward to continuing to execute our mission.”
Reliant Funding has grown rapidly as it seeks to help small businesses across the country in achieving their financial goals, having provided nearly $2 billion in funding to over 30,000 companies since 2008. The nationally recognized company works to provide tailored financial solutions, regardless of business size. Reliant Funding is owned by Angelo Gordon, a leading global alternative investment firm that provides research-driven investment solutions, driven by their 30+ years of expertise.
Art Peponis, Head of Private Equity at Angelo Gordon, said, “Steve has been instrumental in building Reliant Funding to the leading alternative finance company it is today and has been pivotal in its ability to continue to provide support to small businesses impacted by the devastating COVID-19 pandemic. His decades of expertise, innovative perspective and dedication to our people and small businesses made him the perfect fit as the new CEO of Reliant Funding. We’re confident that he will continue to provide American small businesses with the access to funding they need and the service that assists them in accomplishing their goals. The future is bright for Reliant Funding.”
For more information on Reliant Funding, please click here.
Reliant Funding, headquartered in San Diego, provides customized, short-term funding to small and mid-sized businesses nationwide. For more information, please visit www.reliantfunding.com.
Angelo Gordon, headquartered in New York City, is a global alternative investment company, focused on credit and real estate. For more information, please visit www.angelogordon.com.
New York’s New Governor
August 10, 2021Now that Governor Cuomo is leaving office early, the Lieutenant Governor, Kathleen Hochul, will become his replacement. This detail is relevant given that New York’s landmark legislation (SB 5470) for the small business finance industry is slated to go into effect on January 1st.
Hochul served as Erie County Clerk and as a member of Congress. She’s also long been an advocate of small business.
While running on Cuomo’s ticket in 2018 for Lieutenant Governor, she criticized her opponent in a controversial campaign ad by saying that he couldn’t be trusted to manage the state budget because he had defaulted on a small business loan.
SB 5470 is expected to be so restrictive, that at least one small business finance provider has already fled the state.
Loans Canada Announces Online Lending Survey Results
August 9, 2021
Loans Canada published their annual online lending survey results on Monday morning. The company polled online personal loan applicants throughout Canada.
Among the results, several statistics stand out.
40.8% of respondents said that they felt “pressured” to fill their loan application quickly, a compelling counter to the mainstream narrative that borrowers are demanding speed.
44.8% of respondents said they felt “pressured” to accept credit building services even though 85.3% of applicants that had been rejected for an online personal loan said they had been rejected on the basis that their credit score was too low.
Loans Canada noted large swaths of satisfaction and dissatisfaction alike, finding that applicants that have never been able to get approved for an online personal loan were highly likely to rank the online borrowing experience as “very bad” while those that have been approved were highly likely to rank the online borrowing experience as “good” or “very good.”
AMEX: Kabbage to be the “Landing Point” for Small Businesses
August 5, 2021
Now that American Express has put “Kabbage to work” with a business checking account offering, the company shared what’s next during the Q2 earnings call.
“..what you’ll see ultimately is the Kabbage platform being the landing point for small businesses,” AMEX Chairman and CEO Steve Squeri said. “And the way you want to think about this is fintech with scale. And so when you think about Kabbage, which is a pure-play fintech in the small business space and you think about American Express and the small businesses, and you combine that together, you have a fintech at scale. Not a fintech growing at scale, a fintech growing from scale with a balance sheet. And so that has always been the vision of Kabbage. As you bring Kabbage into the bank holding company structure, you have to do some other things to future proof it, if you will, and that’s what we’ve been doing. But that’s what you will see.”
IOU Introduces the “Cash Back” Concept to the Small Business Loan Market
August 4, 2021
Immediately following news of a management shakeup, small business lending company IOU Financial introduced a first-of-its kind offering to eligible customers, cash back.
“Available only to qualified new clients,” as the announcement says, the IOU Cash Back Loan enables borrowers to benefit from perfect payment history by receiving 3% of the original loan back in the form of a cash rebate.
According to Carl Brabander, the new EVP of Strategy, this is not a gimmick where the rebate can only be applied to a future loan or loaded up onto a gift card.
“The merchant would receive the cash back amount by ACH directly to their bank account,” he writes, “provided they (a) have a perfect repayment history and (b) apply for the rebate within 30 days of repaying the loan, using the cash back certificate we would have sent them when the loan closed.”
Translated into dollars, this reward could be sizable given that IOU’s average loan size hovers around $100,000 and can go much higher.
“The IOU Cash Back Loan gives us the opportunity to give something back to new clients that put their faith in us to fund their growth plans,” said IOU CEO Robert Gloer in a public statement.
The cash-back loan concept was developed scientifically through focus group testing, the company claims.
The sudden flurry of activity emanating from IOU can probably be attributed to a deal struck last year when Neuberger Berman, an investment manager with $374B under management, acquired a 15% stake in the firm.
Brabander says that IOU is very bullish on the rest of the year and 2022.
“We see small business coming back strong now that the 2nd round of PPP has finished working its way through the system,” he says. “That’s why we’re investing heavily in products (ex. Cash Back), technology (our IOU360 platform) and distribution right now…”
Shopify Capital Originated $363M in MCAs and Business Loans in Q2
August 4, 2021
Shopify Capital originated $363M between merchant cash advance and business loans in Q2, bringing the first half total to $671.6M.
“Not only does Shopify Capital help fuel our merchants’ growth,” said Shopify President Harley Finkelstein in the quarterly earnings call, “our data tells us that merchants that accept Capital stay with Shopify longer as they succeed on the platform and take more of Shopify’s other solutions, namely Shopify shipping, apps, themes and domains and maybe most importantly, extending capital when their business needs it, reinforces the trusted relationship that we have with our merchants, one that goes beyond what they have with their bank or any other vendor. When we talk about Shopify’s flywheel, this is exactly what we mean.”
Shopify Capital is in the same league as rivals Square and Enova in terms of small business financing volume. Square Loans originated $1B for the first half, for example, while Enova has originated $722M.
Square Loans (Formerly Square Capital) Originated $627M in Small Business Loans in Q2
August 4, 2021
Square Loans, the lending arm of the fintech bank Square, originated $627M of its Flex Loans in Q2, according to the company’s latest announcement. That brings the year-to-date total to $1.02B across 167,000 loans. The numbers produce a rough average of only $6,000 per loan.
“After pausing flex loan offers from early March to late July of 2020, we continued to expand loan offers during the second quarter behind improvements in underlying Seller GPV trends, nearing pre-pandemic quarterly origination levels for core flex loans,” the company said.
Square is on pace to meet or eclipse its pre-covid volume. (It originated $2.3B in 2019.)
Square touted much bigger news in the past few days, however, its planned acquisition of Australia-based Afterpay in a $29B all stock deal.
Wave of Management Changes Come to IOU Financial As it Ramps Up For the Future
August 4, 2021
Small business lender IOU Financial is undergoing one of the largest management shakeups of 2021. The company announced a slew of new hires and new roles for existing team members early this morning.
Joining the company are:
- Carl Brabander, EVP of Strategy
- Jason Stevens, VP of Loss Mitigation
- Sam Abolgar, VP of Finance (US)
New roles are as follows:
- Madeline Wade, EVP Operations
- Stewart Yeung, EVP of Finance
- Jeff Turner, EVP of Risk Mitigation
- Richard Zapata, VP of Engineering
- Lori Haygood, VP of Compliance
IOU founder Phil Marleau also recently completed his planned transition from CEO to an advisory role. President and COO Robert Gloer has taken over as CEO as previously announced.
The burst of change at IOU is perhaps unsurprising given that Neuberger Berman, an investment manger with $374B under management, acquired a 15% stake in the company last year.
“IOU’s new management structure lays the groundwork for growth and innovation,” Gloer said in a public statement. “With this team in place IOU Financial has never been in a better position to achieve rapid growth through innovation in the areas of technology, products and distribution.”
