Archive for 2023
Too Many Cash Flow Management Tools? Business Blueprint Looks to Address Inefficiencies
April 24, 2023
“One of the bigger things [small business owners] realize is, ‘Wow I spent so much time on the financial, the back office, and not what I love, not what initially drew me to starting a business,’” said Brett Sussman, VP of Marketing & Sales for Business Blueprint and Banking at American Express.
American Express recently conducted a survey with 1,100 small business owners that found that more than three quarters were looking to consolidate their cash flow management tools. That’s because they are often forced to rely on multiple tools to manage and project their cash flow, which uses up valuable time and impacts their ability to just focus on their business.
“What’s happening is in today’s uncertain economic climate small business owners are seeking this visibility and there used to be an expression that ‘cash is king,’ I now think it’s moved to ‘cash flow is king,’” said Sussman.
The survey participants included business owners with anywhere from fewer than 10 employees to 500 employees, spanning various industries. The survey revealed that 60% of SMBs use between two to three cash flow management products currently, with 62% spending 5 hours a week on various platforms and 18% spending even more time. It also showed that consolidating cash flow management products onto one platform would help build confidence among business owners and reduce the time they spend on these tasks.
The cost of tools themselves is also a concern. The data revealed that 36% want more affordable pricing.
“Price is certainly a consideration here and there are out there free cash flow management tools, and that’s something that we’re currently offering with Business Blueprint from American Express,” Sussman said.
Unsurprisingly, American Express is addressing their own findings through Business Blueprint. Among the key benefits of their cash flow management tool is ease-of-use, interoperability, and that it’s free.
WBL Secures Anchor Institutional Financing and Resumes Full Operations and Funding
April 24, 2023
World Business Lenders (WBL) is resuming funding this week and relaunching originations through its Traditional, Digital API, and ISO Express channels, following a financing arrangement announced today by WBL CEO Doug Naidus.
“I am excited to welcome our new financing partner, not only enabling WBL to resume loan origination and funding, but affording access to more lending capacity than ever before,” said Naidus. “We are eager to return to market and launch our new business model.”
Initially, WBL will prioritize funding the customers who have remained in its pipeline since December 2022 when the company temporarily paused funding. WBL will begin accepting new loan submissions from its ISO partners, with respect to which additional detail will be provided over the coming days. In parallel with accepting new submissions, WBL will roll out a full-service Digital API business model and a self-service ISO Express business model, for certain qualified ISOs. At the helm of the new business model launch is John Milligan, WBL’s Chief Operating Officer, who now heads loan production.
“The API model will enable larger ISOs to leverage a digital integration that will automatically submit merchant applications straight to WBL. The ISO Express model empowers ISOs with the ability to generate offers for their merchants directly online. Both of these digital offerings are high-growth opportunities that will maximize the earning potential of our ISO partners through a combination of speed and simplicity.” said Milligan.
To learn more about how your business can maximize profits by partnering with WBL and leveraging its new API business model, please reach out to John Milligan’s team directly at isorelations@wbl.com. Also, be sure to inquire about meeting times with the WBL team at the upcoming Broker Fair on May 8th, of which WBL is pleased to be a sponsor.
A Side Effect of New State Laws? Registry Lookups
April 21, 2023
DailyFunder, the original funder’s forum since 2012, will include links to governmental registries on its site. Among the first two to be added are California and Virginia. The purpose is to serve as a reference point to verify a funder or lender’s claims. Additional states like Utah and New York will follow. Brokers and referral partners should use all the tools at their disposal to conduct due diligence on whomever they are considering to work with.
“‘The ‘I saw them in the courts’ or ‘I saw them in banks’ method isn’t exactly proof of legitimacy,'” a post on the forum stated.
DailyFunder also recently shared that it is experiencing a rather vibrant burst of interest. The forum logged 2.3 million page views in 2022 and this year is on pace for 3 million, it claims.
Amex to Continue Extending Credit to Small Businesses, Not in Same Position as Smaller Banks
April 20, 2023
American Express plans to continue extending credit to small businesses despite some of the challenges in the economy, according to the company’s latest quarterly earnings call. CEO Steve Squeri said that the company isn’t in the same position as a lot of the other smaller banks right now.
“…for those credit worthy small businesses we will continue to extend credit and it could be an opportunity for us actually, provided the credit is good,” Squeri said. Part of that opportunity, Squeri explained, was in being able to service businesses that historically had not considered them a “lender of first resort.”
Amex’s business loan division was formerly known as Kabbage. It rebranded to Business Blueprint in January.
Broadly, times are good for Amex. The company experienced a record-setting first quarter with $14.3B in revenue and a healthy profit of $1.8B.
Percentage of Merchants Seeking MCAs in 2022 Waned But Approval Rate Went Up
April 19, 2023
Only 7% of small businesses that applied for financing in 2022 applied for a merchant cash advance, according to the most recent report published by the Federal Reserve. Of those, 90% reported being approved for some amount of capital. That’s up from the 84% in 2020 and up from the 87% reported in 2019 prior to the pandemic. Approvals, it appears, were quite generous in 2022.
Overall, the percentage of merchants seeking MCAs has dipped, however. In 2019 for example, 9% of businesses said that they were seeking an MCA. In 2021 it was 8%. In 2022 it was 7% as mentioned above. The decrease could be explained by the pandemic which introduced an abundance of free and low interest government business aid. Also, the proliferation of low-cost online lenders created by the 0% interest rate environment may have weakened demand for alternatives like MCAs. Given that much has changed in the last 4 months, the Fed’s next report (scheduled for release in approximately March 2024) stands to be much more informative.
Goldman Sachs Cutting Loose its Marcus Loan Portfolio, Is Going Hard on Savings Accounts
April 18, 2023
Goldman Sachs followed the windup of its Marcus online lending business by taking a $470M loss on a partial sale of its loan portfolio and transfer of the rest of it to held for sale, the company revealed. Marcus still exists for the bank as an online savings account brand, which it has found very adept at acquiring deposits.
Goldman’s actions with Marcus were explained in January when CEO David Solomon said “…we tried to do too much too quickly.”
When Marcus first launched, Goldman Sachs was widely viewed as trying to compete with LendingClub in the online lending space. Both companies are now more famously known to consumers for another product, a high yield savings account. Marcus offers 3.9% APY on savings right now while LendingClub offers 4.25% APY. Despite LendingClub’s perceived edge here, Goldman Sachs announced yesterday that it was teaming up with Apple to offer an Apple Card savings account that pays 4.15% APY.
Are Canadians Terrible at Self Promotion?
April 17, 2023Canadian-based company, Nuvei, just released a set of commercials featuring Canadian-American actor Ryan Reynolds as their new investor. The series jokes that American tech companies get all the attention because “Canadians aren’t good at self-promotion.”
Nuvei is a technology company that offers payment solutions to businesses to accelerate their revenue growth. Products include payments, payouts, platform integrations, and Banking-as-a-Service. Using their tools, businesses can connect with their customers in more than 200 markets, 47 locations, and 600 alternative payment methods.
Reynolds said that when he invested in Nuvei he used Canadian dollars, which is a real thing.
Take a look!
What’s Your Equipment Worth? They’ll Tell You
April 14, 2023
Sandhills Global, a publishing and technology conglomerate, has served as a central marketplace for selling heavy equipment since 1978. Often considered the auto trader of the industry, it primarily focuses on the sale of used machinery in the transportation, construction, and agriculture sectors.
“Nearly every dealer in the country, be it a Caterpillar, Volvo, Peterbilt, or John Deere dealer, works with us because we’re the hub where they go to move their US machinery,” said Mitch Helman, Sales Manager at AuctionTime.
AuctionTime is one of many used-equipment marketplaces owned by Sandhills Global. Other popular Sandhills brands like AuctionTime include Machinery Trader, Tractor House, and Truck Paper.
“Virtually every wholesale buyer and dealer is our customer, allowing us to showcase their equipment to a wide range of potential buyers, including the average Joe or end user, who are typically found on Machinery Trader and Truck Paper. These buyers are the ones we want to reach, as they’ll often pay the most for the equipment,” explained Helman.
Sandhills strives to educate sellers on setting realistic prices for their equipment, helping them understand the retail value versus the auction value. Their value insight portal tool provides information on the specifics of the equipment, depending on its features and location, as location can greatly influence its worth.
“First and foremost, customers come to us to determine the market value and worth of their equipment. If they have a returned asset, we’re then able to connect them with different buyer bases, depending on the asset, to help them get the most money back in their pocket,” said Helman.
And those customers, it turns out, very often are drawn from Sandhills’ print publications.
“…It’s interesting because you hear print media is dead, there’s no need for print, all these newspapers are going away, but in our industry print has turned into like a physical search engine and it ultimately drives more traffic to the internet for people to look at more pictures, videos, specs and stuff like that,” said Helman. “And so, it’s still very relevant and vibrant in our spaces as of today.”
These publications can often be found at truck stops, tractor houses, and local convenience stores. Once a reader goes to a site like AuctionTime, the craigslist-style homepage (a tab says a new look is coming soon) will guide users to various live auctions or fixed-priced listings with photographs. A 2013 Hamm 3307 smooth drum roller located in Olney, Illinois, for example, is currently up for sale for $56,900. The listing has it all, including an integration to get shipping quotes and a button to apply for financing.
Ultimately, Helman explained that in a way the market depends on them to compile all this information to establish which way the market is going and what’s happening. “They love it,” he said. “Absolutely love it.”
