Industry News
+1 for Swift Capital, -1 for Lending Club
December 15, 2016Swift Capital has named Tim Naughton as Chief Legal Officer, according to a company announcement on Thursday. “Prior to joining Swift Capital, Naughton advised Bank of America’s small business lending and deposit services as assistant general counsel and senior vice president,” it says. “He served as external counsel for American Express and Sallie Mae, and was a partner at Hudson Cook specializing in financial and regulatory compliance.”
Hudson Cook law firm coincidentally produced the merchant cash advance industry’s training course.
Meanwhile, Lending Club disclosed in an 8-K Thursday that CTO John MacIlwaine had tendered his resignation “to pursue another opportunity.” MacIlwaine had been with the company for more than 4 years. He is the latest of several C-level execs to depart in 2016. Former CEO Renaud Laplanche resigned in a scandal earlier this year and CFO Carrie Dolan, like MacIlwaine, also resigned “to pursue another opportunity” back in August. Other executives including Jeff Bogan and Adelina Grozdanova, Lending Club’s Head of Investor Group and Vice President, Head of Institutional Investors respectively, also both resigned in May. Lending Club’s stock is down more than 50% since the beginning of the year.
AI Sales Assistant Penetrating Alternative Finance Raises $34 Million in Series B Round
December 15, 2016
Wondering how your competition always seems to be so on top of their game? They might be using an artificially intelligent sales assistant. Such technology was reported on last month when deBanked learned that it had penetrated the alternative business financing industry through at least one company named AI Assist. AI Assist is powered by Conversica, a Foster City, CA-based technology firm that announced it had raised $34 million in a Series B round on Wednesday led by Providence Strategic Growth Capital Partners L.L.C. More than 1,000 companies across technology, automotive, higher education, finance, insurance, real estate and hospitality are using Conversica.
“Conversica’s AI technology has helped IBM be smarter about engaging our prospective customers and maximizing their value as they move through our sales funnel,” Kevin Pollack, head of IBM’s Global Email Marketing Practice, is quoted as saying in a press release. “Not only have we freed up resources within the marketing team and gained immediate value in the form of qualified sales opportunities, we are also seeing how AI can help transform our entire business moving forward.”
For Roman Vinfield, who launched a merchant cash advance ISO in 2015, it changed his life. “I hadn’t heard anything like an artificial-intelligence sales assistant,” said Vinfield. “The results we got within a month of using it were unbelievable.” Within the first month, Vinfield made $35,000 in revenues by spending just $4,000 and he eventually reduced his staff of 24 to 4 people. He’s since launched AI Assist, the exclusive reseller of Conversica to the alternative finance industry.
“We’ve gone way beyond the theoretical,” Conversica CEO Alex Terry told Fortune. A demo given by Vinfield of AI Assist, demonstrated that its artificial intelligence can communicate with merchants over emails in a way that is indistinguishable from a human. According to Fortune, Terry said the sales assistant software has proven so effective for some customers that recruiters have even mistaken the software for a human and tried to make a hire. Other contacts have sent in thank-you notes and flowers, he added.
Conversica has raised more than $56 million since inception. Providence, who led the Series B round, also owns stakes in Hulu and the Yankees Entertainment & Sports Network (YES Network). Conversica’s technology is only available to this industry via AI Assist.
RapidAdvance’s Mark Cerminaro is deBanked’s November/December Cover
December 14, 2016
It’s been a quick rise for Mark Cerminaro, who won the 2016 Commercial Finance Association’s 40 Under 40 Award and is the Chief Revenue Officer of RapidAdvance based in Bethesda, MD. He is featured in the November/December issue of deBanked magazine that is currently being delivered to subscribers nationwide. If you haven’t already subscribed, you can SIGN UP HERE FREE.
An excerpt from the story:
Early in Cerminaro’s tenure at Morgan Stanley, the company sent him for training with about 300 other new employees at 2 World Trade Center in Manhattan. The date was Sept. 10, 2001. When the trainees reported to the office the next day, they were in a 64th-floor conference room when they heard an explosion and saw shreds of paper floating past the windows. They didn’t realize yet that a terrorist controlled jetliner had hit next door at 1 World Trade Center.
deBanked interviewed Mark and several folks who know him professionally. He joined RapidAdvance in 2007, which gave him a front row seat to the financial crisis that forever shaped the company. “We went from a single-product company, to now being more of a solutions-based company,” he said.
If you want to know how the big players are succeeding, you’ll certainly want to hear what a day in the life of a chief revenue officer is like, and how Mark is making the sales hum at Rapid.
The digital version will be online next week, but you don’t want to miss deBanked magazines in print. Sign up FREE!
Fintech Startup BlueVine Raises $49 Million in Series D Funding
December 14, 2016- The company has provided more than $200M in financing to thousands of businesses
- In response to customer demand BlueVine is increasing credit lines to $2 million for invoice factoring and $100,000 for business lines of credit
- Company is expanding strategic relationships with partners like Intuit
REDWOOD CITY, Calif. (December 14, 2016) BlueVine, a leading online provider of everyday financing to small businesses, announced today it has closed $49 million in funding. The Series D funding round was led by existing investors, including Lightspeed Venture Partners, Menlo Ventures, 83North, Citi Ventures, Rakuten FinTech Fund and Silicon Valley Bank.
Since launching in March 2014, BlueVine’s cloud-based financing solutions have helped thousands of small businesses obtain quick, easy access to the funds they need to purchase inventory, cover expenses and expand operations.
We are very proud of all we’ve accomplished in 2016 and excited to continue on our incredible growth trajectory, said Eyal Lifshitz, CEO and founder of BlueVine. BlueVine is delivering unprecedented ease and convenience to meet SMB owners¹ financing needs and help them achieve their goals.
This financing will support BlueVine’s rapid growth as it expands its team and range of offerings. BlueVine has already funded more than $200 million in working capital for SMBs and is on track to fund more than $500 million in working capital during 2017.
This team continues to push the pace of innovation to deliver best-in-class everyday financing products, said Yoni Cheifetz of Lightspeed Venture Partners. We are delighted to have supported BlueVine’s journey to date and thrilled to enable them to bring their vision to thousands more SMBs across the country.
BlueVine’s business line of credit has proven to be very popular with QuickBooks users, said Rania Succar, business leader of QuickBooks Financing. It fills a critical part of the QuickBooks Financing portfolio and allows us to extend credit to younger businesses. We are excited about expanding our partnership to serve even more QuickBooks SMBs with BlueVine’s business line of credit.
BlueVine also announced it has once again increased its maximum credit lines based on client demand:
- For invoice factoring the maximum credit limit has been increased from $250,000 to $2,000,000
- For the business line of credit the maximum credit limit has been increased from $50,000 to $100,000
BlueVine offers credit lines starting at $5,000 for a business line of credit and $20,000 for invoice factoring.
About BlueVine
BlueVine offers small businesses financing solutions to access the funds they need to purchase inventory, cover expenses or expand operations. BlueVine was the first factoring company to develop a fully online, cloud-based platform for invoice factoring, enabling rapid advances on outstanding invoices due in 7-90 days and bringing a 4,000-year-old industry into the digital age. BlueVine also offers Flex Credit, an on-demand, revolving line of credit through the same online platform. With BlueVine, business owners can focus on growing their business instead of worrying about their bank account. BlueVine is funded by Lightspeed Venture Partners, Citi Ventures, 83North, Correlation Ventures, Menlo Ventures, Rakuten Fintech Fund and other private investors.
About Lightspeed Venture Partners
Lightspeed Venture Partners is an early stage venture capital firm focused on accelerating disruptive innovations and trends in the Enterprise and Consumer sectors. Over the past two decades, the Lightspeed team has backed hundreds of entrepreneurs and helped build more than 300 companies globally. The Firm currently manages over $4 billion of committed capital and invests in the U.S. and internationally, with investment professionals and advisors in Silicon Valley, Israel, India and China. www.lsvp.com
Press Contact
Amberly Asay
BlueVine Public Relations
801-461-9776
bluevine@methodcommunications.com
Update: Stitt v OnDeck Class Action Dismissed
December 12, 2016
In case you missed it, the class action lawsuit filed in August 2015 by small retail investor Carl Stitt against OnDeck, its officers and underwriting banks for violating securities laws, was dismissed in late September of this year. Stitt withdrew his suit without prejudice as to all parties, including another investor, Isaac Malafsky, whose own class action suit was eventually consolidated into Stitt’s.
The case never gained any traction. Once the two suits were consolidated, OnDeck filed a motion to dismiss on multiple grounds, while pointing out that part of the complaint’s argument for a supposedly undisclosed negative trend came from a blog post on SeekingAlpha whose author had a short position in OnDeck’s stock. deBanked reported this on August 7th, 2015, when it was determined that the author was not just any short seller, but a company owned by Hunter Adams, who notoriously served time in prison for his role in a previous stock manipulation scheme.
Once the judge asked the parties to present oral arguments on the motion, the plaintiffs withdrew instead.
OnDeck traded at $10.47 on the day Stitt’s case was filed last year. It closed at $4.30 on December 9th, 2016, down by more than 50% since then.
Knight Capital Funding Announces New Chief Data Scientist, Alex Kondratyev
December 11, 2016MIAMI, Dec. 9, 2016 /PRNewswire/ — Knight Capital Funding, a financial services company dedicated to delivering working capital to small and medium sized businesses in an efficient and transparent manner, announced the hiring of Alex Kondratyev as its Chief Data Scientist.
Kondratyev had been providing financial consulting to Knight Capital prior to accepting the role of Chief Data Scientist. He will be working out of Knight Capital’s new Silicon Valley office. Prior to joining Knight Capital, Kondratyev worked at Cadence Design Systems, a multinational electronic design automation software and engineering services company, as a senior software Architect. At Cadence he led and managed the scheduling group, which was responsible for a kernel of C-to-Silicon synthesis that involves about 20 man-years of development with more than 100,000 lines of C++ code.
“Alex will be integral to our data modeling in all aspects of our business. His expertise will play a critical role in our underwriting models, giving us the enhanced capabilities to mitigate potential fraud, while also increasing our approval ability to get working capital in the hands of small and medium sized businesses,” said Rich Ferrante, CFO at Knight Capital.
“I was intrigued by the rapid growth and unique technology platform at Knight Capital,” said Kondratyev. “I am very happy to have joined and to be a part of the largest funding and revenue months in the Company’s history, which gives us many data points to enhance the prediction power of our models.”
Kondratyev has been in software design his whole career with a specialization in complex algorithms. He began his career as a professor in Logic Design and Foundations of programming. He then joined Cadence Design Systems where he was a founder of C-to-Silicon synthesis group. Later he moved to Xilinx Inc. and worked as Principal engineer before joining Knight Capital. Kondratyev has a Master’s in Computer Science as well as a Ph.D. in Computer Science from the esteemed Saint Petersburg Electrotechnical University in Russia. He holds seven U.S. patents, more than 50 Russian patents, and is co-author of two monographs on asynchronous synthesis with more than 120 conference and journal publications.
About Knight Capital, LLC
Founded in 2013 and with offices in New York, Silicon Valley, Florida, India and Dominican Republic, Knight is a leading financial technology company that provides customized financing solutions to small and medium size businesses in the United States. Knight leverages its leading technology platform to provide solutions to small and medium sized business owners with greater speed and flexibility than in the marketplace. Visit www.knightcapitalfunding.com to learn more.
SOURCE Knight Capital Funding
OnDeck Announces New $200 Million Revolving Credit Facility with Credit Suisse
December 9, 2016
NEW YORK, Dec. 9, 2016 /PRNewswire/ — OnDeck® (NYSE: ONDK), the leader in online lending for small business, announced today the closing of a $200 million asset-backed revolving debt facility with Credit Suisse.
In addition to its other funding sources, OnDeck may now obtain funding under the new credit facility with Credit Suisse, subject to customary borrowing conditions, by accessing $125 million of committed capacity and an additional $75 million of capacity available at the discretion of the lenders.
“OnDeck has emerged as a leading provider of growth capital to small businesses around the country,” said Jon-Claude Zucconi, Managing Director, Credit Suisse. “The team’s innovative vision and commitment to financing is vital to expansion and growth in the small business community.”
Under the facility, loans will be made to Prime OnDeck Receivable Trust II, LLC, or PORT II, a wholly-owned subsidiary of OnDeck, to finance PORT II’s purchase of small business loans from OnDeck. The revolving pool of small business loans purchased by PORT II serves as collateral under the facility. OnDeck is acting as the servicer for such small business loans. The Class A Loans under the facility were rated by DBRS, Inc.
OnDeck intends to initially use a portion of this facility, together with other available funds, to optionally prepay in full without penalty or premium, the existing $100 million Prime OnDeck Receivable Trust, LLC facility which was scheduled to expire in June 2017. As a result, OnDeck will benefit from obtaining additional funding capacity through December 2018.
“This transaction marks a continuation of our financing strategy to diversify funding sources, extend debt maturities, and create additional funding capacity to pave the way for future loan growth,” said Howard Katzenberg, Chief Financial Officer, OnDeck. “We are pleased to have Credit Suisse, a leading global financial institution, support OnDeck in our mission to power the growth of small business through lending technology and innovation.”
About OnDeck
OnDeck (NYSE: ONDK) is the leader in online small business lending. Since 2007, the company has powered Main Street’s growth through advanced lending technology and a constant dedication to customer service. OnDeck’s proprietary credit scoring system – the OnDeck Score® – leverages advanced analytics, enabling OnDeck to make real-time lending decisions and deliver capital to small businesses in as little as 24 hours. OnDeck offers business owners a complete financing solution, including the online lending industry’s widest range of term loans and lines of credit. To date, the company has deployed over $5 billion to more than 60,000 customers in 700 different industries across the United States, Canada, and Australia. OnDeck has an A+ rating with the Better Business Bureau and operates the educational small business financing website BusinessLoans.com.
For more information, please visit www.ondeck.com.
About Credit Ratings
Credit ratings are opinions of the relevant rating agency. They are not facts and are not opinions of OnDeck. They are not recommendations to purchase, sell or hold any securities and can be changed or withdrawn at any time.
Safe Harbor Statement
This press release contains “forward-looking statements” within the meaning of the private Securities Litigation Reform Act of 1995 and other legal authority. Forward-looking statements include statements about the intended use of proceeds from the new facility and expected optional repayment in full of the existing facility, the extension of debt maturities and the availability of additional funding capacity, all of which are dependent upon compliance with the borrowing and other conditions of the new facility, as well as information concerning OnDeck’s business plans and objectives and financing plans including future loan growth. Forward-looking statements can also be identified by words such as “will,” “enables,” “expects”, “may,” “allows,” “continues,” “believes,” “intends,” “anticipates,” “estimates” or similar expressions. Forward-looking statements are neither historical facts nor assurances of future performance. They are based only on OnDeck’s current beliefs, expectations and assumptions regarding the future of its business, anticipated events and trends, the economy and other future conditions. Moreover, OnDeck does not assume responsibility for the accuracy and completeness of forward-looking statements. As such, they are subject to inherent uncertainties, changes in circumstances, known and unknown risks and other factors that are difficult to predict and in many cases outside OnDeck’s control.
As a result, you should not rely on any forward-looking statements. OnDeck’s expected results may not be achieved, and actual results may differ materially from OnDeck’s expectations. Important factors that could cause actual results to differ from OnDeck’s forward-looking statements are the risks that OnDeck may not be able to manage its anticipated or actual growth effectively, that its credit models do not adequately identify potential risks, and other risks, including those under the heading “Risk Factors” in OnDeck’s Annual Report on Form 10-K for the year ended December 31, 2015, Quarterly Report on Form 10-Q for the quarter ended September 30, 2016 and in other documents that OnDeck files with the Securities and Exchange Commission, or SEC, from time to time which are available on the SEC website at www.sec.gov. OnDeck undertakes no obligation to publicly update any forward-looking statements for any reason after the date of this press release to conform these statements to actual results or to changes in OnDeck’s expectations, except as required by law.
OnDeck, the OnDeck logo and OnDeck Score are trademarks of On Deck Capital, Inc.
Logo – http://photos.prnewswire.com/prnh/20150812/257781LOGO
SOURCE On Deck Capital, Inc.
Barbara Corcoran, OnDeck Contest Final Aired on Rachael Ray Show
December 6, 2016The OnDeck “Seal of Approval” contest led by company spokesperson Barbara Corcoran recently came down to one final challenge and the results were aired on the Rachael Ray Show on Tuesday.
Three small businesses were featured and each won $10,000 paid for by OnDeck. Corcoran couldn’t mention the company enough times. This kind of collaboration and publicity is probably the best kind of marketing an alternative lender can get, not to mention a great opportunity for small businesses. Watch the TV segment of it below:
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