Business Lending
Shopify Capital Originated $393.6M in MCAs and Business Loans in Q3
October 28, 2021Shopify Capital, the funding arm of e-commerce giant Shopify, originated $393.6M in merchant cash advances and business loans in Q3, the company reported. That’s up from the $363M in the previous quarter.
Covid was a boon to Shopify Capital given its dependence on e-commerce businesses. Its 2020 funding volume was almost double that of 2019.
“Shopify Capital has grown to approximately $2.7 billion in cumulative capital funded since its launch in April 2016,” the company announced. The large volume and continued success has landed the Shopify Capital division in the company’s “core” bucket of “near-term initiatives” that will build the company for the long term, according to a presentation accompanying Q3 earnings.
Slava Rubin, Founder of Indiegogo, to Keynote Broker Fair 2021
October 22, 2021
Broker Fair announced that Slava Rubin will be its keynote speaker for its 2021 conference on December 6th in New York City.
REGISTER HERE FOR BROKER FAIR 2021
Who is Slava Rubin?
Slava Rubin is an entrepreneur and innovator in the fintech space for nearly 20 years. Slava built an alternative investment platform, a venture fund, an equity crowdfunding platform, a perks crowdfunding platform, and an angel investment portfolio. Slava is a founder of Vincent, a company which has developed the largest database of alternative investments (crypto to NFTs, trading cards to art, real estate to venture and debt) and is changing how people access them. He is also founder & managing partner at humbition, a $30M early-stage operators venture fund built by founders, for founders. Slava also founded Indiegogo, a company dedicated to empowering people from all over the world to make their ideas a reality. As CEO for over 10 years from inception in 2006, Slava grew Indiegogo from an idea to over 500,000 campaigns and more than $1B distributed around the world. While at Indiegogo, Slava launched one of the nation’s first equity crowdfunding businesses. Slava’s angel portfolio includes 4 unicorns – Carta, Hedera, GOAT, & Turo. He is also a founding advisor to multiple companies including Hedera Hashgraph – a top 60 blockchain protocol.
Prior to Indiegogo, Slava was a strategy consultant working on behalf of clients such as MasterCard, Goldman Sachs and FedEx. He is also the founder of “Music Against Myeloma,” a charity that raises funds and awareness for cancer research in partnership with the International Myeloma Foundation. Slava is currently a member of the board for NYSE traded (WSO) Watsco Inc., and privately held, Indiegogo.
Slava represented the crowdfunding industry at the White House during the signing of the JOBS Act under the Obama administration and has helped navigate bringing equity crowdfunding to the American public. He also pioneered security tokens in the United States – having been a catalyst for selling fractionalized ownership of the St. Regis hotel in Aspen using blockchain technology. He has made many TV appearances including being a regular guest commentator on CNBC. He has also been often quoted in NYTimes and Wall Street Journal.
Slava has received numerous awards including Fortune 40 under 40, Observer 20 Heros under 40, and the Wharton Young Leadership award for 2015.
Slava holds a B.S.E. from the Wharton School of Business
SBA Task Force Set to Begin Campaign
October 19, 2021
In response to an unprecedented economic situation, a mixed group of regulators, bankers, small business owners, funders, attorneys, and social media representatives are coming together in a task force to work with the SBA, members of Congress, small businesses and entrepreneurs to transition small business into a “new phase.”
Dubbed the SBA Task Force at last week’s Bipartisan Committee summit on small business recovery, the group’s goals are to address the state of small business in the U.S., how the current economical and political climate is impacting the practices of merchants across the country, and to address concerns from interested parties directly to the federal government.
“The SBA is at a crucial moment: its laudable performance during the COVID crisis has thrust upon the agency new expectations and new responsibilities,” said Pradeep Belur, former COO of the SBA and co-chair of the committee. “To fulfill those, [the] SBA needs not only enhanced capacity but also modernization to enable it to execute effectively. I’m honored to help chair this task force and pursue measures that will support the agency and help the heart of America’s economy.”
Alongside Belur as co-chair of the committee is Ann Marie Mehlum, a Senior Advisor at FS Vector with almost four decades of experience in banking. Much like Belur, Mehlum is committed to continue the largely unfinished project of improving the operating conditions for small businesses.
“The work of assisting small businesses is never finished—the SBA has continually sought to respond to new needs and reach more types of small companies,” Mehlum said. “The members of this task force, which I’m delighted to help chair, are committed to working with the agency and Congress to improve the ways in which that work is carried out.”
The founder of the committee, Angela McIver, is the owner of an after-school math program for children based in Philadelphia. When faced with pandemic related troubles, McIver pivoted her business from a brick and mortar learning program into a fully virtual, nation-wide learning platform.
“One of the smartest things I did was develop a relationship with a community bank” said McIver, when asked what advice she would give to small businesses at the BPC’s summit. “We didn’t have a lot of the challenges that small businesses had because we had a relationship with a small bank that knew who we were, knew our challenges, and [they] were able to step in when it was necessary.”
Other members of note on the force are Christopher R. Upperman, a Manager & Team Lead in the Governance Organization at Facebook, Jessica Johnson-Cope, President, Johnson Security Bureau and co-chair of the 10,000 Small Businesses Voices National Leadership Council, and Ryan Metcalf, Head of U.S. Public Policy and Global Social Impact at Funding Circle.
“Our participation in the BPC’s task force reflects our ongoing commitment to advocate for government policies that are in the best interest of small business owners” said Metcalf, exclusively to deBanked. “We truly believe that the strongest path forward for the SBA involves leveraging the proven capabilities of fintechs to quickly and efficiently reach typically underserved communities through a modernized approach to government-backed small business lending.”
Metcalf and his company seemed to be excited to take part in the committee, having a direct impact on the space in which their business operates. “On behalf of Funding Circle, I look forward to working with stakeholders across the lending landscape to support an effective bipartisan SBA reauthorization that best prepares the agency to help small business owners,” he said.
Members of the committee are confident that the group will help modernize the practices of the SBA while also empowering them. “The government agency dedicated to supporting [small businesses] must do the same and adapt its systems and programs to support that evolution,” said BPC Board Member and former Senator and Chair of the Committee on Small Business and Entrepreneurship Olympia Snowe. “I’m confident that this task force will successfully develop ideas and recommendations to enable the SBA to do that.”
Pandemic-Induced Pivot Results in Innovative Lending Software
October 15, 2021
“What the hell are we going to do now?”
Kunal Bhasin, CEO of 1West, saw the light at the end of the tunnel for his business in March of 2020. Instead of closing his doors and pursuing other options in finance, Bhasin held strong and began developing a product that was merely an idea prior to his business’s abrupt halt.
“I made the decision at that point when everyone was running, I hired two full time engineers. I said hey, I’ve had this idea for a long time, the whole company has had this idea for a long time, we just never had the time to implement, and then all we had is time because we [weren’t] closing that many deals.”
The idea, a software called ABLE (Automated Business Lending Engine) is a platform that minimizes the lapsed time that occurs in the funding process. “There were deals all over the place in different people’s inboxes. And then those people would have to put those deals into our processors, which created huge gaps of time,” said Bhasin.
“We needed to centralize the deal flow. Whether the deal is coming from a partner, or the deal is coming from a customer, [we needed] a centralized place where a customer could land and start completing the process.”
With the help of his former college roommate, engineers, and staff, Bhasin put his idea to fruition— and ABLE took off. “We rolled up our sleeves and spent the better part of the last 16 months building it, and now the largest percentage of my time devoted to running 1West is on the software and the platform.”
Bhasin claims that his product gives his company a huge competitive advantage, as he is able to use AI to evaluate, process, and determine the type of funding and through which lender is best on an individual basis.
“[ABLE] really shrinks that entire gap time so when the lenders get in early morning, when the funders get in early morning, our stuff is always in queue, and it’s created really nice returns on the amount of customers we’re getting and the amount of deals we’re funding.”
The automation of the application process has allowed potential borrowers to not only find the ideal package for their needs, but allows them to apply for different types of capital streams, something that would take tons of manpower and time without the ABLE software.
“Greater than 90% of the customers who come into ABLE apply for more than one product,” said Bhasin.
When asked about if there were any plans to license the product in the future, Bhasin was hesitant to give a definite answer for the future of his creation. ABLE is already white labeled by 1West for brokers.
“Maybe,” he said, I want 1West to reap the benefits of it for 6-12 months and fix all the tweaks we have to make. We have a lot going on.”
North Mill Equipment Finance Hit All-Time Quarterly Loan/Lease Originations Record
October 14, 2021
North Mill Equipment Finance just had its best quarter in 60 years. The company originated $129.1M in Q3. That was up from the record set the previous quarter of $120M.
Contributing to the company’s growth rate is the recent joint acquisition of 100% of the stock of parent company Aztec Financial, LLC.
“This has been an exceptional year,” said David C. Lee, Chairman and CEO, North Mill. “In addition to introducing a new category of equipment through the acquisition of Aztec, we recently purchased a $50.3 million portfolio of seasoned truck and trailer leases to help diversify our portfolio even further.”
The company is on pace to surpass $400M in originations in 2021.
What Makes a Great ISO?
October 13, 2021
Working and developing relationships with ISO’s can be some of the best and most difficult parts of working in the small business finance industry. The relationships between the merchants and these individuals can make or break the success of a funder, and a great ISO can take a funder and the merchant to the next level.
Kristin Parisi, ISO Relations Manager for Park East Capital, shared with deBanked what traits, characteristics, and commonalities separate the best reps from the rest of the pack.
“I think the top thing is someone that is super attentive,” said Parisi, when asked what is the biggest factor that makes a successful ISO. “Someone [who] is available to speak at all times, after sending something in an email or they send me something, I’ll call them and they’ll pick up, someone easy to reach out to, and someone who cares about the deal.”
Kindness also plays a big factor in making a great ISO according to Parisi, who said that sometimes the attitude of certain reps can impede business and make funding deals much more difficult. “I have come across some people who can be super rude,” she said. According to her, kindness and honesty can make or break not only an individual deal between a funder and a rep, but can be the foundation for the entire relationship between the two.
“It’s like a friendship type of thing,” she said, when describing the ideal relationship between both parties. “Someone who is trustworthy, loyal, someone who won’t screw you over behind your back, who won’t send your deals somewhere, someone who won’t screw you over for money. Honesty is the main thing.”
Parisi credits her success to these developed relationships. “The ISO’s I do work with are all my friends now, and I think we have a great thing going,” she said.
She noted the challenge of dealing with ISO’s from a female perspective, setting boundaries and being assertive while also trying to be kind and develop positive relationships. “Being a woman in this industry is a little different than being a male. I’m kind of approached differently, the girls on my team are approached differently. I’m one for being really kind and honest, but [only] to a certain extent because [ISO’s] will walk all over you.”
Apart from the personality that is projected on the funders themselves, another key trait is the professionalism of the ISO themselves, according to Parisi. She spoke about the younger, money-hungry mentality that can lead to ISO’s becoming disingenuous or difficult to work with. Rather than a hustle and bustle mentality, she credits understanding the terminology and how the industry functions as a desirable trait in a potential ISO.
“You don’t need ten plus years in the industry,” said Parisi. “You need a few months in the industry, you get it, and you’re good.”
Sonia Alvelo, CEO of Latin Financial Will Appear on deBanked TV
October 6, 2021
Sonia Alvelo, CEO of Latin Financial, will join Sean Murray live on deBanked TV on Thursday at approximately 12:15pm EST. Latin Financial is based in Newington, CT and Alvelo has contributed valuable insight to deBanked over the years, particularly on the Puerto Rican small business finance market.
Anyone can tune in to debanked.com/tv/ for free without any registration to watch.
Who is Latin Financial?
A family owned and operated brokerage firm with a variety of backgrounds and expertise. We’re here to help all of our clients with their business’ unique financial needs. No loan is too big or too small for us; our goal is to simply help create a positive future for all of our clients. Here at Latin Financial, we understand that working capital can be difficult to obtain. With banks approving fewer and fewer loans, borrowing for your business’ future can be frightening and uncertain, especially in today’s economy. With Latin Financial you’re in good hands.
Latin Financial has over 10 years of business financial experience between its advisors.
We are at the forefront of this quickly changing economy and we work closely with our clients and investors because we are fully committed to meeting and exceeding expectations. We also believe in keeping our services affordable, working around your budget while never charging fees.
We are proud that so many of our clients have repeatedly turned to us for guidance and assistance with their business capital needs. We work hard to earn their loyalty every day.
Small Business Funders Are Hiring, But Does Anyone Want the Jobs?
September 28, 2021
As the small business finance market gets back to normalcy, the industry’s latest challenge is filling all of the open positions. Jobs that would once attract hundreds of resumés are now ending up with very few, if any at all.
Even after pursuing LinkedIn, the applicant pool just looks light.
In our research, deBanked found five fintech companies on LinkedIn that have ads that are at-least a week old with three or less applicants.
One company based on Long Island, promoted a $5,000 signing bonus for an underwriting position and only had five applicants. Meanwhile, a self-acclaimed “prestigious” Manhattan lender even has a month-old ad posted that offers a $10,000 per month salary. That job has one active applicant, according to LinkedIn.
Chad Carter, Director of Franchise Success at Lendio, says the hiring process has been difficult, but isn’t impossible to navigate. “Being based in Utah has been somewhat challenging as unemployment is extremely low and the Silicon Slopes area has a lot of tech headhunting,” said Carter. “We’ve hired and are hiring hundreds more people this year so we feel it too. Luckily we have extremely good reviews on Glassdoor, which helps keep applications coming and our culture keeps them here.”
Some companies have gotten creative when it comes to building their staff to counter the lack of applicants in the workforce. “We have seen some open roles have more interest than others,” said James Webster, CEO of ROK Financial. He says his company has been able to expand hiring by offering remote sales positions that opens the applicant pool nationwide.
“We have been hiring and building an outside sales division known internally as the Remote Sales Division,” Webster said.
He claims the number of applicants for remote sales positions have been high, but that doesn’t mean his company is hiring a ton of staff to add to the program. “We are still extremely selective on who we allow onto the platform as they represent ROK in the market,” said Webster.
“All in all, recruiting is harder now than it has been in previous years,” Webster said. “Especially when the culture in the office is such a priority to maintain.” He noted that the roles that are currently difficult to fill are mostly administrative positions, not sales.
A recruiter for a large finance-centric company that wishes to stay anonymous told deBanked that the finance industry in general is having hiring troubles, not just fintech. “There’s tons of turnover all around,” said the recruiter, who claims that they themselves are actively being poached by other companies due to the lack of people wanting to work.
“I can only assume that fintech is just as crazy,” the recruiter said.
