Announcements
SmartBiz Loans Ranked Number One Provider of Traditional SBA 7(a) Loans Under $350,000
December 5, 2016SAN FRANCISCO, CA – December 5, 2016 – SmartBiz Loans, the first SBA marketplace and bank-enabling technology platform, has ranked as the number one provider of non-Express, SBA 7(a) loans under $350,000 for the 2016 government fiscal year. SmartBiz also ranked number five among providers of under $350,000 traditional SBA 7(a) and Express 7(a) loans combined.
“SmartBiz’s success in this year’s SBA 7(a) ranking demonstrates how technology can support banks in meeting the needs of small businesses,” said Evan Singer, CEO of SmartBiz Loans. “SmartBiz is committed to creating the leading marketplace for both banks and small business owners, by matching small business owners with the bank best suited to their needs and enabling a higher percentage of SBA loans to be approved.”
SmartBiz generated $200 million in funded SBA 7(a) loans through its bank lending partners, which helped them earn the top spot. The data used is based on SBA lending data released in November, reflecting its 2016 fiscal year which ended on Sept. 30. Wells Fargo Bank, which was ranked just below SmartBiz, generated $155 million in funded non-Express SBA 7(a) loans under $350,000. This is the first time a technology platform and marketplace has achieved the number one position in SBA’s ranking of 7(a) loans.
“Small businesses are the driving force of the economy,” said Ann Marie Mehlum, retired Associate Administrator, Office of Capital Access, U.S. Small Business Administration. “By supporting them, the SBA and lending partners like SmartBiz are investing in the economy as a whole.”
SmartBiz is revolutionizing SBA lending. Its marketplace helps increase approval rates by automatically directing businesses to the right lender, while its advanced software streamlines the SBA loan application, underwriting and origination process. In this way, SmartBiz fills a critical gap in the small business loan market and enables small businesses nationwide to grow without settling for the sky-high rates of alternative online lenders or undergoing the typically slow and tedious traditional bank process.
About SmartBiz Loans
SmartBiz Loans is a unique combination of an online SBA loan marketplace and a bank enabling technology platform. The company’s online software provides SBA preferred lenders customized and automated origination, underwriting and documentation, making approval and funding fast and easy. Sophisticated algorithmic sorting in the SmartBiz marketplace also enables higher approval rates for small businesses because the right applications are automatically directed to the right bank. SmartBiz is based in San Francisco and was founded in 2009 by a team of experienced financial services entrepreneurs with backing from leading venture capital firms including Investor Growth Capital, Venrock, First Round Capital, Baseline Ventures, and SoftTech VC. Learn more at www.smartbizloans.com.
Total Merchant Resources Launches Wholesale Funding Division, Secures $20 Million in Private Equity
December 1, 2016Dec 2, 2016 / Piscataway, NJ – An old name in the industry is now a new kid on the block with wholesale. Total Merchant Resources in Piscataway, NJ announced today that it is finished with a first round of funding and has secured $20 million in private equity. This new designation allows TMR to quickly and easily service ISO’s from coast to coast via its wholesale funding division, TMRNOW.
“We are thrilled to open our very successful funding platform to the entire industry. In addition, TMR is now perfectly positioned to do business in California since we are one of the few in this space to obtain a California lending license.” said TMR Co-Founder and CEO Jason Reddish.
Reddish and co-founder Val Pinkhasov, who were featured on CNBC’s ‘Shark Tank’, were among the very first business lenders to enter this space. They are a respected name in the industry and, thanks to their major prime time TV appearance, have brought attention to this underutilized model for businesses to obtain working capital.
“Funding on the retail side all these years, we understand where funders have failed in the past and being that our money is completely private, we have no one to answer to in regards to underwriting. We create our own programs and common sense pricing. We look forward to being a name that ISO’s can trust on every level and making common sense, in house decisions” says Val Pinkhasov President of TMR.
Both Reddish and Pinkhasov have several decades of finance experience and have helped thousands of businesses achieve their goals. They are now excited, in a properly regulated fashion, to do so in on the wholesale side. Please visit TMRNOW.COM for more information.
For more information call Gary Lane (212) 220 9872.
Brief: LendIt Brings First Fintech Awards to the Industry
November 28, 2016
Marketplace lending conference LendIt, has announced the first fintech industry awards and is inviting nominations to recognize top-performing companies and executives.
Nominations are now being accepted (closes December 21st) for 18 different categories including executive of the year, fintech woman of the year, emerging consumer lending platform and most innovative bank. The award ceremony will be held during LendIt’s 2017 conference in March.
“The lending industry is entering its 2.0 phase, after maturing in 2016,” said Peter Renton, co-founder and chairman of LendIt in a statement. “As we seek to connect the global online lending community and foster innovation and industry growth, we must recognize those that are making the biggest contributions and innovations and moving our industry forward.”
The entries will be judged by a panel of 30+ industry experts including Gilles Gade, CEO of Cross River Bank, Glenn Goldman of Credibly, and Angela Ceresnie, COO of ClimbCredit.
Marketplace Lender P2Bi Raises $7.7 Million In Venture Funding
November 18, 2016
Denver-based crowdfunding marketplace lender, P2Binvestor has raised $7.7 million in Series A1 funding led by a Colorado-based angel investor network, Rockies Venture Club and a Japanese venture firm Future Venture Capital Co, its first investment outside Japan.
The P2Bi platform currently has 150 investors – both institutional and retail and it plans to fund 112 new borrowers, up from the current 80 borrowers, by Q1 next year. The proceeds will be used to boost sales and marketing efforts and grow the company’s operations towards this target.
Founded in 2012, P2Bi provides revolving lines of credit of up to $10 million to businesses. With an average line of $1 million, the company’s customers include businesses in retail, manufacturing and consumer goods packaging. It has originated $350 million since 2014 and it is on track to hit $8.2 million in revenues this year.
“We’re seeing more interest in our model as venture funding hits a two-year low and more entrepreneurs are looking for ways to grow their business while preserving their equity using good-quality, flexible debt,” said CEO Krista Morgan in a press statement.
P2Bi has been bullish about fundraising and diversifying its capital sources. Less than two months ago (September 20), it closed a $10 million credit facility with Pittsburgh-based mortgage service company Urban Settlement Solutions and in April this year, through a partnership with New York-based hedge fund, MW Eaglewood Americas, the company raised $50 million in debt.
i2B Capital Provides $4 Million Revolving Line of Credit to CFG Merchant Solutions
November 8, 2016NEW YORK–(BUSINESS WIRE)–i2B Capital (www.i2bcap.com), a provider of direct financing to niche-market financial entrepreneurs, is pleased to announce the closing of a $4 million asset-based revolving line of credit with an accordion to $6 million with CFG Merchant Solutions (CFGMS). CFGMS is a privately owned and operated specialty finance company focused on providing working capital to small and mid-sized businesses (Merchants) in the U.S. that are historically underserved by traditional financial institutions.
Said Mr. Larry L. Curran II, CEO of i2B Capital, “CFGMS gave us the perfect opportunity to apply asset-based lending principals to non-traditional receivable assets in an early stage specialty finance company. CFGMS is a new division of an established finance business with traditional bank financing; however, these receivable assets were excluded from the existing borrowing base. The CFGMS management team is seasoned, backed by private equity, and enabled with technology—exactly what we look for in our target customer. Additionally, they have grown their financed receivables more than 500% since beginning the process.”
Barbara Anderson, Chief Operating Officer at i2B Capital commented, “Our goal over the initial 18-month funding commitment is to prepare CFGMS for more traditional institutional financing in the future. To accomplish that we will provide the growth capital along with our commercial lending expertise to help them prepare for the disciplined reporting requirements and credit processes at the next level.”
William Gallagher, President of CFGMS said, “Obtaining an asset-based loan against our non-traditional asset class within our first year of operation is instrumental in allowing us to execute on our growth strategy, and achieve some very aggressive portfolio and revenue targets. We had to work through several considerations with i2B due to the age and size of the portfolio, but through mutual collaboration we were able to put in place a facility that will enable us to take our business to the next level.”
CFGMS is a subsidiary of CapFlow Funding Group, a commercial finance company that offers an array of products such as factoring, purchase order finance, and asset-based loans. Both companies are headquartered in Rutherford, New Jersey. CFGMS with additional offices in New York City is a direct funder providing working capital to small businesses. They are entrepreneurs who understand first-hand the challenges of acquiring flexible and timely financing. CFGMS combines proprietary analytics and technology, with common sense underwriting to provide fast and efficient access to capital. Programs include Small Business Advance, Merchant Cash Advance, and Invoice Factoring. For more information about CFGMS contact William Gallagher at wgallagher@cfgms.com or visit www.cfgmerchantsolutions.com.
i2B Capital is headquartered in Fort Collins, Colorado with offices in Herndon, Virginia. The company provides senior debt and direct asset investments for growth capital to qualifying entrepreneurs and equity-backed emerging specialty finance companies throughout the United States. For more information about i2B Capital contact Barbara Anderson at 703-871-3993 or banderson@i2bcap.com, or visit www.i2bcap.com.
Contacts
i2B Capital
Barbara Anderson, 703-871-3993
banderson@i2bcap.com
Merchant Cash Advances Are Not Loans – Take the Online Course to Learn Why (And Get a Certificate)
November 3, 2016
A New York Supreme Court decision in June was pretty deliberate when it said a purchase of future receivables was not a loan.
Essentially, usury laws are applicable only to loans or forbearances, and if the transaction is not a loan, there can be no usury. As onerous as a repayment requirement may be, it is not usurious if it does not constitute a loan or forbearance. The Agreement was for the purchase of future receivables in return for an upfront payment. The repayment was based upon a percentage of daily receipts, and the period over which such payment would take place was indeterminate. Plaintiff took the risk that there could be no daily receipts, and defendants took the risk that, if receipts were substantially greater than anticipated, repayment of the obligation could occur over an abbreviated period, with the sum over and above the amount advanced being more than 25%. The request for the Court to convert the Agreement to a loan, with interest in excess of 25%, would require unwarranted speculation, and would contradict the explicit terms of the sale of future receivables in accordance with the Merchant Agreement.
Lawyers around the country are pointing to this published decision and other similar ones as becoming the standard rule of law in New York State.
Finally, there are extracurricular steps you can take as a sales rep, underwriter, or other participant in the industry to educate yourself on what it means to buy future receivables at a discount versus a loan.
A new online course created by law firm Hudson Cook LLP, teaches the basic and unique characteristics of merchant cash advance contracts. New entrants and veterans alike can take the course and corresponding exams to brush up on the core fundamentals of MCA. Those that pass will receive a certificate of completion in “Merchant Cash Advance Basics” that is valid for two years. There are even video tutorials in case you don’t like to read.
Co-produced by deBanked as part of an effort to foster educational standards in the industry, the course just only recently went live. An educated sales force is no doubt integral to the success of the industry and the businesses it serves.
This in no way implies that company in-house training programs are currently insufficient. Instead, companies can use the course to supplement their own in-house training efforts with new hires or to test current employee education levels. More comprehensive versions of the course or new components of it may be developed in the future. We realize this can be evolved to cover more, but for now, it’s the basics.
Can YOU pass MCA Basics?
That’s a copy of my real certificate on the right (shrunken down to fit in this story). I got a perfect score.
Hosted on Counselor Library, you can sign up to purchase the course here.
Update 11/4: Link to the course in the story has been fixed: http://www.counselorlibrary.com/public/courses-mca.cfm
Brief: Cross River Bank Raises $28 Million in Equity
November 1, 2016
New Jersey-based Cross River Bank, a marketplace lending partner bank, secured $28 million in equity, led by Boston-based investment firm Battery Ventures, along with Silicon Valley venture capital firms Andreessen Horowitz and Ribbit Capital.
The capital will be used to expand the bank’s technology and product-development teams, invest in compliance infrastructure and plan new business lines to the online lending industry. Battery General Partner Scott Tobin will also join the Cross River board of directors.
Cross River originated over $2.4 billion loans in 2015 and partners with over 15 online lenders including Affirm, Borrowers First, Marlette Funding, Rocket Loans and Upstart.
Expansion Capital Group Announces New Executive Management Team
October 25, 2016SIOUX FALLS, S.D., October 25, 2016 – Expansion Capital Group (ECG), a provider of small business loans, is pleased to announce several changes to its executive management team.
Effective immediately, Mr. Vincent Ney (ECG’s majority shareholder) is CEO and will focus on further developing the foundation built by the Expansion Capital team. In addition to an impressive combination of leadership and operational experience, Mr. Ney brings a passion for building financial services businesses with a focus on meeting the needs of its strategic partners and its customers. Most recently, he was involved in the online consumer lending sector where he was instrumental in building a business to $100 million in revenue.
As part of Mr. Ney’s early initiatives, Expansion Capital Group has begun testing and implementing new loan term and pricing options to provide broader and more advantageous solutions for borrowers.
Additionally, Mr. Marc Helman has joined Expansion Capital Group as Director of Strategic Partnerships. In this role, Mr. Helman is responsible for driving originations across the Company’s Funding Partner and Partnership channels. Before joining ECG, Mr. Helman spent over ten years in investment banking and venture capital, providing financing to both private and publicly traded small businesses. Mr. Helman stated, “I am incredibly excited to join Expansion Capital Group’s growing team. As our product offerings and platform continue to expand, we look forward to serving the capital needs of a wider variety of small businesses.”
Mr. Ney and Mr. Helman add to other members of the executive team that joined earlier in 2016. Mr. Herk Christie joined ECG’s operations team in March after experience and tenure with Resurgent Capital Services and Capital One. Mr. Tim Mages joined in February as CFO to assist ECG with its financial analysis and Capital Markets initiatives.
Dusty Wasmund, ECG’s VP of Business Development and Channel Partnerships, stated “During the past six months, ECG has broadened its executive management team to build a sustainable business that enables small business owners to access capital quickly to capitalize on their objectives. Our combined team brings a variety of experiences and perspectives to better serve our customer’s needs. This team has collaborated extensively during the past 60 days to strategically bring two new product innovations to market, which provide our borrowers greater financing options tailored to their specific needs. I am very excited about our revised positioning and look forward to working with many of our strategic partners during 2017 as we continue to grow our platform.”
As part of these changes, ECG also recently executed a partial equity recapitalization by ECG’s existing two family office investors. This additional equity, along with its $25 million credit facility closed in partnership with Northlight Financial and Bastion Management during the fourth quarter of 2015, provides ECG with enhanced capital resources to facilitate future growth. With this additional equity base and more flexible product alternatives, ECG will look to significantly expand its origination partners and loan volume.
About Expansion Capital Group:
Since 2013, Expansion Capital Group has provided over 5,000 small businesses with capital exceeding $130 million. Expansion Capital Group has developed a platform based on data aggregation and predictive modeling, which enables it to service this target market cost-effectively. Expansion Capital Group uses a broad array of both traditional and nontraditional data sources to predict individual performance and cash flow of each small business.
For general inquiries, please contact:
Tim Mages
CFO
(605) 877-3910
For sales, lead generation, or channel partner inquiries, please contact:
Mr. Dusty Wasmund
VP of Sales and Channel Partnerships
(605) 351-5833
Mr. Marc Helman
Director of Strategic Partnerships
(605) 681-6400
