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Related Headlines
| 10/21/2023 | Kapitus CFO on how he starts his day |
| 04/03/2023 | Kapitus increases debt facilities to $540M |
| 08/24/2022 | Kapitus increases funding capacity by $95M |
| 04/07/2022 | Kapitus expands to India |
| 02/09/2022 | Kapitus closes $200M securitization |
Stories
Kapitus Closes $45 Million Investment-Grade Corporate Note Financing
June 18, 2024NEW YORK, NY JUNE, 18, 2024 — Kapitus, a leading provider of financing for small and medium sized businesses, today announced the closing of a $45 Million investment-grade corporate note financing. The closing of this most recent financing increases the Company’s total debt facilities to $585 Million. Proceeds from the transaction will be used to further expand the Company’s portfolio of financing products and making further technology investments in its funding platform, making it easier for more small businesses to acquire critical growth capital more quickly.
“With this most recent round of financing, Kapitus reaffirms its commitment to stand ready to support small businesses with fast and efficient funding alternatives. Recent research continues to show that businesses are finding it more and more difficult to access capital as both bank and non-bank lenders pull back,” said Andrew Reiser, Chief Executive Officer of Kapitus. “By expanding the products we are able to provide and enhancing the speed in which small businesses can receive financing, we will be able to address the unmet needs of thousands of small businesses across the U.S.”
To date, over $6 Billion in growth capital has been provided to almost 55,000 small businesses through Kapitus.
“This capital raise also shows a vote of confidence from our investors in our business model, diversifies our capital structure, and gives us flexibility as to how and when we deploy capital to support small businesses,” adds Anthony Rose, Chief Financial Officer of Kapitus. “Despite a tight credit environment, we continue to see opportunity to provide capital to small businesses and this raise further enables us to execute our strategic plan more effectively while maintaining our focus on delivering enhanced value to small businesses”
Brean Capital, LLC served as the company’s exclusive financial advisor and sole placement agent in connection with the transaction.
About Kapitus
Founded in 2006, Kapitus is one of the most experienced and trusted names in small business financing. As both a direct lender and a marketplace with an expansive network of financing partners offering a variety of products, Kapitus has provided over $6 billion in growth capital to almost 55,000 small businesses. Kapitus, either directly or through trusted partners, offers products tailored to the need of every small business including term loans, sales-based financing, SBA loans, equipment leases, and revolving lines of credit. For additional information about the company, visit: https://kapitus.com
Media Contact:
Jackie Quintana
Pitch PR
Jackie@PitchPublicRelations.com
480.606.8180
Kapitus CEO Speaks on Success of Rating Reaffirmation
October 6, 2020
When lending companies faced the tightest squeeze on capital since the great recession, many ran into trouble. Kapitus, having survived 08′, met 20′ with the same discipline that helped them navigate the pandemic.
“Our whole industry was put on a credit watch downgrade, and it’s very exciting that we were upgraded, reaffirmed to the original rating,” Kapitus CEO and founder Andy Reiser said. “Most of the companies, our peers defaulted and went into what’s called rapid amortization and did not make it through to keep their securitization.”
Reiser was happy to report that Kapitus received a rating affirmation from Kroll Bond Rating Agency (KBRA) on Friday. KBRA has removed the Kapitus securities from a Watch Downgrade.
Back in March, the businesses that Kapitus and their competitors funded across the country, faced state mandated shutdowns. Many customers were suddenly unable to make the loan, MCA, or equipment payments that they had been able to make for years.
For lenders that bundled and securitized the loans they made, the value of those loans was called into question.
On March 30, KBRA placed the ratings of 29 securitizations representing $2.1 billion from 10 SMB lending firms on a “Watch Downgrade” due to the economic downturn.
To overcome the warning, Kapitus reigned in and focused on helping their customers. Reiser cited the addition of Jeff Newman from Citigroup to manage the risk team as an example of how the firm has been focused on funding responsibly for years.
“We focused on strong business practices and keeping the portfolio strong, and it paid off,” Reiser said. “We never stopped, we were not lending at the same velocity that we did pre COVID, but we never had a day that we didn’t fund a new deal.”
Reiser said that during the pandemic’s height, the team took a lot of long nights working on new products. One was a “step renewal” that allowed clients to pay installments and build up to the full payment, to make sure they were not overwhelmed. Kapitus also offered extended periods for their healthcare loans, up to 36 months, Reiser said.
For companies like Kapitus, a questionable rating could lead to a rapid amortization event: a sudden call to liquefy the bonds and give back investor money. For some, an event like this will spell the end: most firms don’t keep hundreds of millions or even billions on hand to give back principals in a moment’s notice.
Reiser said out of the ten securities on credit watch, only one other was reaffirmed, due to a renegotiation of terms that bond investors had to agree on. Kapitus made no negation but was reaffirmed due to the success of their business practice, Reiser said.
The securitization was initially issued for $105 million in June 2018, and expanded to $160 million last December, in three classes with a senior class rating of “A.”
Reiser believes that the pandemic, like the ’08 recessions, will see some consolidation and strong companies prospering in a displaced environment.
“I think COVID will teach a lot of other players that were very aggressive in coming down to this market that it’s not so easy,” Reiser said. “I think some of the banks and the alternative lenders that were more eager to come into this market may not be so aggressive at least for a while.”
Kapitus Rolls Out Fully Automated Funding Process
April 2, 2019
New York, NY – Kapitus, a leading provider of alternative financing to small and midsize businesses, announces the roll-out of auto-checkout – a fully automated funding process for qualified deals. The new process allows for not only a faster, more streamlined experience for its partners; but it also provides more flexible financing options, by providing multiple offers at once. At the same time, the new process provides merchants with secure and quick access to funds for their business.
Unlike competing models where only an “option of approval” or “conditional approval” is provided at the time of checkout, Kapitus is able to determine approval eligibility with only an application and bank statements without the need for multiple upfront stipulations to confirm bank information, ownership and identity. Utilizing proprietary machine learning models – eligible deals can be closed without any additional documentation.
“This is a true turning-point for us from a technology perspective and we’re very excited about it,” said Andrew Reiser, Chief Executive Officer at Kapitus. “With this new automated process, we’re able to provide our partners an extremely simple process with an exceptionally quick time-to-funding. At the same time, merchants are provided with a more seamless experience with enhanced security”
Major features in the roll-out include:
- True auto-check functionality with full approval at time of checkout
- Progress tracking and customizable notifications to follow merchants through the checkout process
- Intuitive user interface with precise, easy-to-understand instructions for both merchants and partners
- Simple, seamless secure checkout functionality for merchants
“This is the first of many technology advancements we will be rolling out over the next year,” adds Arun Narayan, Chief Product Officer. “We are committed to creating exceptional experiences for both our partners and merchants. Incorporating the right technology is paramount in building out the right environment and the best experience for all of our audiences.”
ABOUT Kapitus
Founded in 2006 and headquartered in NYC, Kapitus is one of the most reliable and respected names in small business financing. As both a direct lender and a marketplace built with a trusted network of lending partners, Kapitus is able to provide small businesses the financing they need, when and how it is needed. With one application business owners can save time and money, while eliminating the stress that comes with applying to different lenders. At Kapitus, we believe that business owners should be able to focus on running their business, while we take care of the financing. Learn more at https://kapitus.com
CONTACT: Bernadette Abel
Kapitus
babel@kapitus.com
646-722-1484
Why Strategic Funding Rebranded as Kapitus
January 15, 2019Today, Strategic Funding announced the launch of a new brand identity, including a name change. Strategic Funding will now be called Kapitus.
“We had a name that was very well respected,” said Kapitus founder and CEO Andy Reiser. “Everybody loved our name, quite frankly. They loved it so much, they all copied it. You can’t trademark ‘Strategic Funding.’ It’s too generic.”
Kapitus, spelled this way, is not a word in any language, which makes it easier to trademark.
“We wanted to separate ourselves in a way that is clearly identifiable,” Reiser said. “It’s an easy one-word name [that] symbolizes stability and strength. It’s ‘capital from us,’ if you want to break it down.”
Reiser said that the company has been relatively quiet over the last three years, but they have been advancing all along, and they are particularly proud of their brand new ISO portal. According to Reiser, the new portal helps ISOs better understand their book at Kapitus and allows brokers to generate a contract quickly without having to call them. The company has an in-house marketing team, but well over 50% of its business comes from the ISO channel.
Kapitus provides a variety of financial products, including equipment financing (they have an in house equipment leasing division) and factoring (they have a small internal factoring group). They also offer business loans, lines of credit and MCA deals. But the company’s largest portion of its business – more than 15% – comes from its Helix Healthcare Financing product, which finances healthcare practitioners like doctors, dentists and veterinarians.
Unlike other funders of healthcare practitioners that may offer financing terms up to 18 months, Kapitus offers terms of up to 10 years as long as the merchant satisfies its requirements. The company also funds a considerable number of healthcare-related businesses, like medical equipment providers. Otherwise, Reiser said that Kapitus has a diversified mix of merchants, from restaurants to manufacturers.
Reiser said that about 15% of Kapitus’s business consists of deals above $150,000 for which they have a seperate team. They do deals as high as $750,000.
When operating under the Strategic Funding name, there was a payment servicing division of the company, called Colonial Servicing. That entity will remain, but will be woven into the new Kapitus name.
Founded in 2006, Kapitus employs 240 people divided among three offices. The headquarters is in New York and there is an office with about 30 people in Arlington, VA, and a Dallas-area office with about 35 people working in collections and customer service.
Strategic Funding Source Announces Launch of New Brand Identity; Unites its Funding Arm and Servicing Arm Under the name Kapitus
January 15, 2019New York, NY – January 15, 2019 – Strategic Funding Source, a veteran of the small and medium-sized business alternative lending space, today announced the launch of a new corporate brand identity, including a new name. As part of this rebrand, the funding division and servicing division will be united under the name Kapitus. The unification of these two divisions will allow for an improved experience for both clients and partners.
Since its inception in 2006, Strategic Funding Source has provided over $2 billion to almost 40,000 businesses in hundreds of industries across the U.S. Over the past two years, the organization has been proactively building out its executive team, bringing in a wealth of experience to transform its risk model, underwriting processes, lending capacity and product line, technology capabilities and customer experience.
With these and other planned advancements, the company required a new brand that better reflected the company’s commitment to be a reliable source of capital to all small and mid-sized business owners.
“The small business lending landscape is consolidating around a few strong and reputable companies. Over the last several years, Kapitus has experienced tremendous growth both in its product offerings to small and medium-sized businesses and in the total number of businesses it serves” said Andy Reiser, CEO of Kapitus. “We chose a name and identity that represents our strength and stability as well as our promise to be a responsible and fair source of capital to small and medium-sized businesses nationwide.”
Along with the name change there will be a new logo, tagline (“Let’s Grow Together”) and domain name (kapitus.com). The rebrand is the first step in the company’s strategy to grow its own financing product line, add to its marketplace of 3rd party lenders and create a foundation for new partnership opportunities. The new brand also represents the company’s commitment to keep the human touch throughout the financing process, while improving customer experience through technology to aid the decisioning process and improve speed to funding.
“This is an exciting change for us,” added Reiser. “This new branding builds upon our history and pays allegiance to our standing as a leader in a fast-evolving industry, opening the door for future opportunities for us, our clients and our partners.”
About Kapitus
Founded in 2006 and headquartered in NYC, Kapitus is one of the most reliable and respected names in small business financing. As both a direct lender and a marketplace built with a trusted network of lending partners, Kapitus is able to provide small businesses the financing they need, when and how it is needed. With one application business owners can save time and money, while eliminating the stress that comes with applying to different lenders. At Kapitus, we believe that business owners should be able to focus on running their business, while we take care of the financing. To learn more, visit www.kapitus.com.
Cloudsquare Unveils Game-Changing Lender APIs for Streamlined Submissions
June 6, 2024New out-of-the-box integrations promises to revolutionize the deal submission process, boosting efficiency and cutting costs for alternative lending companies.
Los Angeles, CA – June 6, 2024 – Cloudsquare, a leading LOS/LMS platform and Salesforce consulting partner specializing in alternative lending solutions, announces the launch of 14 new Lender APIs integrated into Cloudsquare Broker, an alternative lending CRM powered by Salesforce. This significant advancement enhances the speed and efficiency submitting deals to lenders who accept portal submissions
The Lender APIs address common challenges in submissions, reducing delays and costs with a streamlined, automated solution. They integrate with the CRM’s Submission Channel, an AI-powered module that matches the right lenders for each deal, increasing approval rates by avoiding unnecessary declines.
Depending on the lender’s API capabilities, brokers gain access to features like real-time status updates, document retrieval, instant offers and decline reasons, further enhancing processing efficiency.
“With our new Lender APIs, users can experience a tenfold increase in submission speed,” said Jeffrey Morgenstein, CEO at Cloudsquare. “This not only saves our clients tens of thousands of dollars in processing payroll but also ensures they stay ahead of their competitors by operating at peak efficiency.”
Supported lenders include Bitty Advance, CAN Capital, Credibly, Expansion Capital Group, Fora Financial, Forward Financing, Headway, Idea Financial, Kapitus, Lendini, Mulligan Funding, OnDeck, PIRS Capital, and Rapid Finance.
“For customers who work with lenders not currently on the list, Cloudsquare offers the flexibility to add any lender to the submission framework, provided they have an API available,” said Paul Albuquerque, Director of Product at Cloudsquare. “It is our mission to elevate the entire industry and drive synergy through technology.”
This development underscores Cloudsquare’s commitment to innovative solutions that meet the evolving needs of the financial services industry, helping businesses operate more efficiently.
To learn more about how Cloudsquare’s Lender APIs can transform your submission process, visit https://link.cloudsquare.io/RYuO.
About Cloudsquare
Cloudsquare, is a robust LOS/LMS platform and premier Salesforce consulting partner specializing in solutions tailored for alternative lending. We pride ourselves on being the provider of choice for ambitious, forward-thinking organizations aiming to elevate their operations to the next level. Cloudsquare’s excellence has been recognized by industry leaders, is listed on the Inc. 5000 as one of America’s fastest-growing companies and is consistently rated as a top service provider on platforms like Salesforce AppExchange, G2, Clutch and Manifest. For more information, please visit https://link.cloudsquare.io/RYuO.
Dragin Technologies and Ocrolus Announce Strategic Partnership: Enabling the Next Generation of Application Process Automation for Small Business Financing
May 20, 2024
New York, NY – 05/20/24 – Dragin.io, a machine learning process automation tech firm, is thrilled to announce a product integration and strategic partnership with Ocrolus, a leader in AI-driven financial document analysis. This collaboration aims to combine Dragin’s cutting-edge process automation technology with the industry-leading bank statement automation and cash flow analytics products offered by Ocrolus. Together, the new solution offers clients in small business financing unmatched speed, accuracy, compliance, and a robust fraud detection system, providing them with confidence and security in their financial operations.
Mark Ross, CEO of Dragin, expressed his enthusiasm for the partnership: “This is incredibly exciting for the future of the small business financing industry. Dragin specializes in automation solutions that help our clients deliver their offers faster than anyone else in the industry. Partnering with Ocrolus enables us to achieve technological advancements in business financing sooner than expected.”
Dragin’s AI and machine learning (ML) algorithms enable sophisticated data processing, providing actionable insights for offer creation and customization in the business funding deal cycle. This technology empowers underwriters to make informed decisions smarter and more quickly.
This partnership will enable powerful solutions for providers of small business financing, offering:
- Speed and Efficiency: Clients can rapidly analyze bank statement data, accelerating decision-making and reducing the time required for underwriting approvals.
- Compliance and Fraud Detection: Ocrolus’ technology performs comprehensive, AI-driven fraud detection, safeguarding clients against potential risks.
- Accuracy and Reliability: The partnership guarantees high levels of accuracy in data extraction and analysis, minimizing errors and enhancing the reliability of financial assessments.
- A.I. & Machine Learning: Dragin has developed advanced AI and ML models that can parse and classify nearly all document types and fill in missing fields such as industry, leading to a more robust auto-decline system. Integrating Ocrolus’ AI-driven document automation and analytics will bolster Dragin’s overall capabilities in lead prequalification.
“We are incredibly optimistic about this partnership with Dragin,” remarked Sam Bobley, CEO of Ocrolus. “Their focus on improving the efficiency of small business funding processes and commitment to client satisfaction makes them an ideal partner for Ocrolus. We look forward to a successful collaboration that will provide customers with the trusted and accurate data, fraud detection, and analytics they need to confidently make important financial decisions.”
About Dragin
Dragin is a leading fintech solutions provider dedicated to delivering innovative and efficient services to its clients. Founded with a mission to simplify and streamline financial processes, Dragin has developed cutting-edge technology, including A.I. and machine learning, to streamline processing automation which creates actionable insights for offer creation and customization. For more information about Dragin and its automation solutions, please visit https://www.dragin.io
About Ocrolus
Ocrolus is a document AI platform that enables faster and more accurate financial decision-making. The company analyzes documents with over 99% accuracy, regardless of format or quality, supporting hundreds of document types including bank statements, pay stubs, and tax forms. Ocrolus provides a trusted solution to detect fraud, analyze cash flows and income, and streamline decisions for 500+ clients across a number of use cases. Customers such as Enova, PayPal, Rapid Finance, Bluevine, National Funding, and Kapitus leverage Ocrolus automation to build delightful user experiences. To learn more, visit Ocrolus.com.
The Top Small Business Funders Now Vs. Then
January 11, 2024Top Small Business Funders By Year
| 2008 | 2014 | 2023 |
| AdvanceMe (CAN Capital) | OnDeck | Square |
| First Funds | CAN Capital | Enova (OnDeck / Headway) |
| Merchant Cash and Capital (BizFi) | Kabbage | Shopify |
| BFS | Kapitus | PayPal |
| AmeriMerchant | Rapid Finance | Amazon |
| GBR Funding | National Funding | Intuit |
Many people look at 2023 vs 2008 and arrive at the conclusion that the fintechs rose to the top, but if one were to narrow down the definition of those players a little further, they’d notice that PayPal and Square are payment companies, Shopify and Amazon are e-commerce companies, and Intuit owns the Quickbooks accounting software. These are actually older companies that took an old idea (split-funding) and made it new again with some key changes. Although in the present moment it may feel like some of them cannot be beat (which is how the industry felt about the top funders in 2008), much can change over the course of this decade.
Keep your eye on:
- AI
- Blockchain (as payment rails, record-keeping)
- Regulation
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