merchant financing

What Would Barney Frank Say?

July 16, 2014
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While crowd funders navigate the JOBS Act and a possible revision to what constitutes an accredited investor, non-bank business lenders are raising eyebrows with sky high interest rates. Annual Percentage Rates (APRs) are reaching into the triple digits and critics are reaching for their megaphones to say something about it. Unfortunately APRs don’t spell out […]

Access to Capital – A Dose of Reality

June 15, 2014
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So much for a lack of transparency… While sitting directly next to Maria Contreras-Sweet, the head of the Small Business Administration, OnDeck Capital’s CEO corrected U.S. Senator Cory Booker’s comments about the APR of their loans. High teens? Not so, said Noah Breslow who explained their average 6 month loan has an APR of 60% […]

The Real Impact on Small Business

May 22, 2014
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It’s not easy being in the lending business. Just talking about money can make people uncomfortable. Bringing up how much money you have, don’t have, or wish you had is like bringing up politics at Thanksgiving dinner. It’s taboo in this society. It’s even rude to ask somebody how much they make a year. That’s […]

Big Deal #2 Struck in MCA Industry

May 21, 2014
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Another day, another capital raise for some company or other involved in alternative business lending. That’s the way it is these days, but the news about the American Finance Solutions (AFS)/CapFin Partners deal announced on Wednesday is markedly different. It’s the Rockbridge Growth Equity (RGE)/RapidAdvance deal all over again, the welcoming of a major MCA […]

Would an APR Help?

May 14, 2014
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merchant cash advance APR

Merchant cash advance industry hater Ami Kassar added to his collection of rants today in the Wall Street Journal by writing about the True Costs of Cash-Advance Loans. Bloomberg BusinessWeek writer Pat Clark, knowing full well that Kassar and I have sparred online, tweeted: curious what @financeguy74 thinks RT @akassar: The true cost of cash […]

Securitization Begins in Alternative Business Lending

May 1, 2014
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ondeck capital securitization

It’s official, alternative business loans can now be pooled up and sold off to investors. On Wednesday, OnDeck Capital announced a $175 million transaction made possible by issuing fixed rate notes backed by their loans. Their Class A notes were rated BBB by DBRS while the Class B notes received a BB. According to DBRS, […]

What if there were Trigger Leads?

April 27, 2014
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Just recently, a user in DailyFunder’s forum complained that a deal of his had been poached by a competitor. There’s nothing new about that story, but it is what followed that drew interest. He was in the process of renewing his client for additional funds, when out of the blue popped up a competitor that […]

Regulatory Paranoia and the Industry Civil War

April 11, 2014
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Regulation

Stacking is on everyone’s minds in the merchant cash advance (MCA) industry but that war is little more than smoke compared to the fire burning in our own backyard. One of the major topics of debate at Transact 14 has been Operation Choke Point, a federal campaign against banks and payment processors to kill off […]

Is Alternative Lending a Game of Thrones?

April 8, 2014
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Funding Kings

It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it […]

Merchant Cash Advance Syndication: Crowdfunding?

March 28, 2014
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merchant cash advance syndication

You might not have known this, but one of the most lucrative opportunities in merchant cash advance is the ability to participate in deals. It’s a phenomenon Paul A. Rianda, Esq addressed in DailyFunder’s March/April issue with his piece, So You Want to Participate? Syndication is industry jargon of course. You probably know the concept […]

Fund it and Ask Questions Later

March 25, 2014
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FUND!!!

Ever since OnDeck Capital stopped doing verbal landlord references, the underwriting landscape of alternative lending has changed dramatically. Kabbage will supposedly fund applicants in just 7 minutes. Everybody’s under the gun to streamline their process, fund deals faster, and produce record breaking numbers month after month. And why shouldn’t they? Investors are practically foaming at […]

Kabbage Has Leverage With Patents

March 23, 2014
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kabbage Patents

If you’re planning on introducing new technology to the merchant cash advance or alternative business lending space, you might want to start filing a patent, or else end up violating someone elses. I’ve brought up Kabbage and patents before, but another one of theirs caught my attention. In their invention named, Method and Apparatus to […]

Lending Club Threatens The Status Quo

March 20, 2014
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3 billion pound gorilla

In late 2013, consumer peer-to-peer lender Lending Club announced their plans to start offering small business loans. That caused a stir in the merchant cash advance world for a few weeks, but the hype died down. The general consensus was that there would be little to no overlap between the applicants each target. To this […]

Are Loan Underwriting Algorithms Limited?

March 15, 2014
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Declined loan

As news of OnDeck Capital’s $1 billion milestone spread yesterday, Crossing the $1B mark in small business loans from OnDeck to #smallbiz around the country! Great way to end the week! pic.twitter.com/U3KUNxjyez — Noah Breslow (@noahbreslow) March 14, 2014 I couldn’t help but reflect on a major detail revealed about their operation a week prior […]

Is There Cause for Alarm?

March 8, 2014
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Brick and mortar chain stores died this week, after a long illness. Born along Main Street, raised in shopping malls across post-World War II America, the traditional store enjoyed decades of good health, wealth and steady growth. But in recent years its fortunes have declined. Survived by Amazon.com and online outfits too numerous to list. […]

Hello Square Capital

March 1, 2014
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We’ve seen copies of this notice posted on a few websites now: Square, the well-known micro-merchant processor with celebrity CEO Jack Dorsey is debuting a merchant cash advance program. Truthfully, I’m not surprised in the slightest. Come on in Square, the water’s fine! What is still interesting to this day is the realization that so […]

The Growing Divide

February 28, 2014
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the divide

It wasn’t too long ago that everyone in this industry knew everyone else. If not personally, then at least through their credit inquiries or UCC names. You crossed paths and acknowledged each other. It was a small world then. Today, not so much. As the barriers to entry have remained low, the simplicity of ACH […]

How to Value a Merchant Cash Advance Company (or Alternative Lender)

February 9, 2014
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merchant cash advance growth

If you’re at all interested in the future of the merchant cash advance industry, you need to read Wall Street Evaluates Merchant Cash Advance in the first issue of DailyFunder. It offers a fresh perspective through the eyes of financiers outside the industry looking in. Names include: Jason Gurandiano, Managing Director in Deutsche Bank’s Financial […]

Will Peer-to-Peer Lending Burn the Alternative Business Lending Market?

January 12, 2014
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For months I’ve been saying that peer-to-peer lenders will be companies to look out for, the latest being on December 29th. Lending Club fully intends to make the leap from consumer lending to business lending which may possibly pit them against the world of merchant cash advance. In this video, a Bloomberg reporter asks OnDeck […]

2014 Starts off With a Case of Red bull

January 10, 2014
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business lending red bull

Woah, slow down there fellas. Let us digest one thing at a time. We’re not even 2 weeks into the new year and already we’ve learned that: CAN Capital raised another $33 Million (but that they didn’t need it?) Merchant Cash Advance was the the feature story on the front page of the Wall Street […]