Industry News
Luxury Asset Capital Acquires and Relaunches Borro
February 26, 2020
Luxury Asset Capital, the Denver-based lender that secures financing against goods such as Ferraris and Rolexes, has announced this month that it has acquired Borro and will be relaunching borro.com. LAC did not disclose the purchase price.
The news comes after LAC had been in talks to acquire Borro for years, LAC CEO Dewey Burke told deBanked. The merger will see Borro’s New York office remain open for business as many of its staff will stay on. As well as this, LAC and Borro will now be offering loans on a wider range of goods, that start at lower minimum amounts, and which will make use of more flexible terms, Burke stated.
“This was a transformational acquisition for us because obviously the competitor was out of the marketplace, but it really pushed us further to the forefront of being the preeminent lender in our niche space.”
Other news to come from announcement is that LAC is now offering to store customers’ luxury assets in its company vault, allowing the users who choose to do so to access capital immediately via a phone call. LAC will also be retiring its Lux Exchange and Pawngo brands, in favor of replacing them with Borro, because, as Burke put it, “we just thought it was a brand that was stronger than the legacy brands that we had.”
Beyond the merger, LAC plans to continue forging corporate partnerships, like that of its preexisting one with WatchBox, a trading service for preowned luxury watches. The strategy here being to link with the luxury goods ecosystem, enabling convenient pathways for customers to collateralize their asset.
Bitty Advance Has a New Major Partner
February 21, 2020Craig Hecker, who founded and sold Rapid Capital Funding, has acquired a stake in Bitty Advance. According to the press release, Hecker and Bitty Advance CEO Edward Siegel first met more than ten years ago when Siegel had just entered the merchant cash advance industry at Rapid Capital Funding.
Bitty has been on the move. The company has been a regular participant in the networking conferences that deBanked puts on each year.
Siegel says of Hecker in the announcement that “I am thrilled to bring on Craig with all of his MCA experience and his creative thinking to help scale Bitty’s growth.”
The newly-made partners told deBanked that they believe this deal will enable Bitty Advance to leap forward to the next level by adding technology to fund faster and create an industry changing awesome customer experience.
Shopify Capital Originated $430 Million in Loans and MCAs in 2019
February 17, 2020
Shopify Capital, the e-commerce giant’s small business financing arm, originated $430 million in funding through loans and merchant cash advances in 2019. Shopify now has more than 1 million e-commerce merchants on its platform, the company says. Earlier in the year the company began rolling out funding to merchants that are not using its payment service.
Though 2019 year-end reporting for the industry is still sparse, the company’s origination figures will likely cause Shopify to move up the rankings maintained by deBanked.
PayPal, who deBanked predicts will keep its #1 spot, did not disclose its annual origination figures in its already-reported Q4 earnings.
Idea Financial Chimes In On New Hire
February 17, 2020
Last week Idea Financial announced that it had appointed Gregory Sandler as its Chief Operating Officer and General Counsel. Having served as General Counsel to both Beyond Finance and Spruce Finance after working as VP and Corporate Counsel to Bayview Asset Management, Sandler believes he’s well positioned to help Idea.
“I have a sense of gratitude to them, because I feel like I’m piggybacking on a lot of the hard work they’ve already done over the last three years,” Sandler told deBanked in a phone call. “But part of the reason for bringing me on I think is that as we move from a startup to a more mature company certain skill sets are needed, and they put the trust in me that I have the skill set that can help them get to that next level.”
Before providing counsel to alternative finance companies, Sandler served as an Associate Director at Bear Stearns in the mids-2000s.
“We’re about to cross into our one hundred million dollars in funding threshold, which is a big deal, very soon,” Justin Leto, CEO of Idea, explained over the phone. “That’s a major accomplishment, and it just shows that we’re in a position right now where bringing on the strongest and the brightest people is exactly what we need. And I think Greg is a symbol of what this company has become and what it will continue to be.”
We’ve Acquired All Of DailyFunder
February 6, 2020
deBanked’s parent company has acquired 100% of DailyFunder. I was a co-founder of the online forum that launched in 2012 and had remained a partner in it until recently when I had the opportunity to acquire the remainder of the company’s shares.
What does this mean for DailyFunder?
DailyFunder will remain an independent entity and website, and it will continue to keep its trademark name. Its concept, a message board for business finance professionals, will fit nicely into our ecosystem. Our full ownership of DailyFunder will allow us to provide the site with updates, fixes, and improved moderation. Some changes to the site may be implemented over the next several weeks and months.
More than 16,000 threads and 129,000 posts have been published on the forum since inception, a testament to the value that such a site provides to the unique community it fosters. DailyFunder has nearly 10,000 registered members. Discussion on the site originally centered around merchant cash advance but has since evolved to all types of commercial finance.
If you’re one of the men and women who fund daily, well then I hope to see you on the DailyFunder!
If you have a technical question or moderation issue, please email: webmaster@dailyfunder.com. If you have an advertising question, please email me at: sean@dailyfunder.com. Please bear with us as our team gets acclimated to the new change.
Ocrolus Partners with Kiva to Provide Funding and Publish its Customers’ Stories
February 6, 2020
Ocrolus has announced a partnership with Kiva, the Californian non-profit that provides loans to entrepreneurs in countries underserved by funding options. The deal comes after news of Ocrolus’s partnership with Plaid in December, a venture that helped launch the Ocrolus+ platform.
As part of Kiva’s work to help global small business owners, it publishes the stories of those entrepreneurs, charting how they set up their business and what led them to do it. Ocrolus will follow Kiva’s suit with this partnership, as it plans to publish the stories of its own fintech customers. Aiming to highlight the biographies of those businesses and entrepreneurs that have excelled in the alternative finance and fintech industries, Ocrolus will provide $5,000 for Kiva-backed loans for each story published to its site. If the published business chooses to match this funding, Ocrolus will put forward a further $5,000, bringing the total appropriation for Kiva to $15,000.
Speaking on the partnership, Ocrolus’s COO Vikas Dua told deBanked that the inspiration for the deal came after listening to a podcast that featured one of the co-founders of Toms, a company known for its ‘one for one’ policy which sees a pair of shoes being donated to children in need for every pair bought.
“The best part of Kiva is the types of folks you’re helping and the impact you can have. They do a great job of sharing stories of entrepreneurs and folks in need,” Dua said in a call. “Everyone’s incentives are tied together. Overall, we’re just very excited about the mission and very excited not only to tell our customers’ stories, but also to highlight some of the things we’re doing for the folks that Kiva interacts with and they fund. They have some wonderful stories there and we’re excited to share those as well.”
CAN Capital Brings On Edward Dietz as Chief Compliance Officer & General Counsel
February 5, 2020
CAN Capital is continuing its executive hiring spree into 2020 with the news that it has brought on Edward Dietz as its latest Chief Compliance Officer and General Counsel. After providing legal expertise to Marlin Business Services Corporation for nine years and working as an associate for two law firms in Wisconsin and Pennsylvania previous to this, Dietz will oversee CAN’s compliance with all federal and state lending, banking, and securities laws.
“Having worked with Ed and knowing his skill set and the many intangibles that he brings to CAN, I feel fortunate that he’s leading our legal and compliance efforts,” noted CEO Edward Siciliano in a statement. “Ed’s just what we needed as we position CAN for growth and to lead a new era of small business lending.”
Having graduated from the University of Michigan Law School in 2004, Dietz has nearly two decades of legal experience.
Speaking on the news, Dietz said that he “could not be more excited to join a company and a team that believes so deeply that its people and its culture are the keys to harnessing the company’s growth potential.”
Kabbage Introduces Customized Short Term Loans
February 4, 2020
Today Kabbage, the Atlanta-based fintech company that has been funding businesses since 2009, announced its latest product: customized short-term loans that are a result of the combination of Kabbage Payments and Kabbage Funding.
The loans, which run for the length of 3-45 days, are best suited to those businesses who need funding to cover issues in cash flow caused by the unpredictability of revenue, says Kabbage’s Head of Income Products Abraham Williams. “Rent and payroll are on set days every month, but getting paid is variable. We’ve done loans for 6, 12, and 18 months, and we’ve seen that people pay those off sooner, so we saw a need to have a short-term loan to fill gaps in cash flow.”
The terms of such loans will be decided upon by making use of the aggregate data that Kabbage has access to. With its customers providing a number of data points, such as their Amazon account, banking details, payment processes, and social media accounts, Kabbage is in “a really unique position because of the way that we make decisions on loans for small businesses,” notes Williams. “We can really see a very complete picture of a business, which can be different than how other people are essentially underwriting and assessing risk for loans.”
Two options are available for repayment: a traditional balloon payment to be paid at the end of the 45-day period, or a percentage of each sale made using Kabbage Payments going towards repayment. The latter of these provides more flexibility, with merchants being able to choose the percentage of each sale that is to go toward Kabbage and, as well as this, the fee attached to the Kabbage Payments option is smaller.
With the fee’s amount and terms being dictated by aggregated data, Kabbage is describing them as “dynamic,” providing individualized offers. Fees begin at 0.1% with the minimum amount to be borrowed being $500 and the maximum set at 10% of a merchant’s available line of credit for the short-term.
