BFS Capital’s Marrache on Canadian Small Business Landscape
January 28, 2018
It’s been about five months since Michael Marrache took the reins as CEO of BFS Capital. He spoke with us then about the company’s algorithmic solutions, ISO relationships and product pipeline. He recently took some time to talk with AltFinanceDaily about the key themes in the Canadian market in 2018 – from minimum wage, to the impact of US tax reform on the Canadian economy, to ISO opportunities — and BFS Capital’s role there.
AltFinanceDaily: When did BFS Capital begin operating in Canada?
Marrache: BFS Capital funded its first loan in Canada in 2012. Traditionally, we have approached Canada’s market via our partner channel, both US and Canada based. We plan on increasing that effort in 2018.
AltFinanceDaily: Is Canada a market that BFS Capital recognizes as growing?
Marrache: Canada is a growing market for BFS Capital, though our non-US markets, including Canada and the UK, currently represent less than 20% of our global $300 million in financings. We see significant upside in both Canada and the UK in the next 12 months.
AltFinanceDaily: What are the themes as you see them for Canadian small businesses and BFS Capital in 2018?
Marrache: There might be more insecurity among Canadian small businesses this year. The 2018 minimum wage increase to $14 an hour in Ontario, expected to rise again in 2019, for example, might cause some small businesses to have to cut hours or reduce staff to make up for the expense. They may have to raise their prices, which could impact demand.
Additionally, recent policy and legislative changes in the US could also impact Canada. For example, tax reform in the US, specifically a reduction in the US corporate rate, will put the US on par with Canada in terms of tax rates and similar burdens. At the same time, US regulations are being reduced while Canada’s appear to be increasing. All of this is part of the current US government’s initiative to drive domestic business growth and we are not sure how it will affect Canada’s economy, business confidence and consumer spending.
The Canadian dollar is also forecast to remain weak and might continue to fall for a while longer. With US tax reform potentially boosting the economy here, the US Fed is likely to raise interest rates, which might reduce demand for the Canadian dollar. The CAN$ could further slide if Bank of Canada cuts rates again. [Scotiabank]
At the core, however, Canada has 1.1 million small businesses. Not a small number. There were more than 350,000 small businesses created in Canada in 2016 and 42% of job creation in the country in the past decade stemmed from firms with fewer than 100 employees (CIBC Capital Markets). These businesses need working capital for a variety of needs related to their everyday business and, importantly for where we fit in, it has traditionally been difficult for small businesses to obtain financing from banks.
BFS Capital financing has come into the mainstream because it’s more accessible than a bank loan, less expensive than equity, and less risky than bootstrapping. Our financing solutions also require less commitment than taking on a partner or getting venture capital. Moreover, the few big banks in the market have tended to shy away from small businesses, so we have seen an opportunity with our ISO partner-base and directly, for our lending solutions.
Today small businesses in Canada can get the money in their account in just a day or two and there are a variety of products with different rates and payment options. As the market in Canada gets more competitive the rates will continue to go down.
AltFinanceDaily: The last time I spoke with you, you talked about automated solutions, transparency tied to ISOs and company culture. Are these at the forefront of the Canadian business as well? Explain.
Marrache: Yes. These initiatives are embedded in the company strategy at the top. We believe speed is required but not sufficient; the company must lead with a culture of service and transparency. We are also investing in data science to improve risk profiling and process efficiencies for every partnership and every financing, including in Canada. These initiatives have been instrumental to our strengthened partnerships in the US and we expect these to benefit our Canadian partners as well.
AltFinanceDaily: Can you provide any illustration of the number of Canadian merchants on the BFS Capital platform or the amount in loans or MCAs you’ve deployed in the country?
Marrache: Although at a more modest volume than our business in the US, since entering the Canadian market in 2012, BFS Capital has achieved originations growth of approximately 100 percent on a compounded annual growth basis.
Canadian Merchants Show An Appetite For Capital
November 25, 2017In Canada, the average deal size for a merchant is anywhere between $20,000 and $30,000 in funding, depending on who you ask. That’s why when one startup recently funded a $300,000 CAD advance from its balance sheet to a Canadian merchant, the deal turned some heads. While it’s unclear whether this amount could be indicative of a trend unfolding at our neighbors to the North, Canadian small businesses are preparing for some changes in the industry landscape in 2018.
SharpShooter Funding, whose name depicts the famous wrestling move of the WWE’s Bret “The Hitman” Hart, was behind the $300,000 deal with an Eastern Canadian grocer.
If you’re wondering how a merchant funder and WWE legend became partners, chalk it up to a combination of fate and timing. Paul Pitcher, SharpShooter Funding managing partner, has been Hart’s biggest fan since he was a kid. Pitcher got the opportunity to meet his hero when was just 10 years old. It was then that the green shoots of friendship formed, and today the WWE’s Hart is acting commissioner of SharpShooter Funding, having helped to launch the business.
Canadian Merchant Landscape
To get a taste of the Canadian merchant financing landscape, consider that the three top Canadian funders deploy $20 million and $25 million per month combined, explained David Gens, president and chief executive of Merchant Advance Capital, which is included among the top three funders. That’s up from a range of $15 million to $20 million earlier this year.
And while a $300,000 advance may not seem like something to write home about for U.S. funders, it’s a big deal in the Canadian market. The culture among small businesses in the Great White North is different and more conservative than their US counterparts.
“It’s a function of the size of the merchant,” Gens explained. “The typical single-location storefront merchant is going to qualify for $30,000 to $50,000. It takes a larger and more established business, whether it’s a multi-location merchant or a business that is in the B-to-B space, a manufacturer, distributor or wholesaler to be large enough to qualify for large financing.”
Meanwhile there are some changes to small business taxation that are coming down the pike that may influence demand for credit, Gens noted, though the precise shape any changes to the tax law will take remains unclear.
“They will reduce the small business taxation rate on the face of it. But for businesses where they hold cash or need to hold cash, it’s a gray zone as to whether or not they will be able to hold financial assets in those businesses. The government is going after companies that are holding investments. But there’s a gray line as to what is a holding company that is holding an investment and an operating company holding a buffer because of seasonality or cyclical demand. We have yet to see what the rules end up being exactly,” Gens said.
Anatomy of the Deal
In the case of SharpShooter Funding, the grocer merchant originally came to the funder for less than $300,000 but qualified for more, bringing the funder’s tally for a single day’s deals to more than $500,000.
“We never thought we’d hit this milestone in the Canadian market. But the file was right, and the timing was great,” Pitcher told AltFinanceDaily. Now that they’ve gotten a taste of it, SharpShooter Funding hopes to do more deals of this nature. “For a small funder like us to double the size of a big funder was a big moment for us, especially in the Canadian market,” Pitcher said.
Merchant Advance Capital’s Gens said his company is prepared to take on the risk for deals at even a higher threshold. “Our average is $35,000 to $40,000, and the largest deal we’ve ever done was $600,000. I don’t want to steal their thunder, but there have been larger deals,” said Gens. “A few funders may syndicate when deals get that big, but it’s not an inconceivable size.”
OnDeck, which similarly has Canadian operations, lends up to $250,000 CAD in Canada. OnDeck has extended more than $7 billion in online loans across 70,000-plus customers across the United States, Canada and Australia.
As for SharpShooter Funding, Pitcher said the funder has been on the sidelines for larger deals because they don’t want to grow too fast. He’s been turned off by other funders doing deals within a couple of months of launching and then being forced to close their doors.
“Our capital has always been strong. It’s not that we can’t afford to lend larger amounts. It’s because we want to make sure we’re doing it right from the start,” Pitcher said, adding that SharpShooter Funding has only had its doors open in Canada since June 2015, though its corresponding U.S. business, First Down Funding, has been around since 2012. “It’s been a work in progress, and I love every day of it! We’re only getting started, and I am 100% excited for the future,” he said.
The Canadian grocer reached out to SharpShooter Funding in response to Google advertising. The affiliation with the Bret Hart association didn’t hurt. Pitcher explained there is a seasonality tied to the merchant’s business, evidenced by a couple of months or more each year in which revenue is spotty, that made the grocer unattractive for banks to fund. “That’s why those sized deals are difficult to put out and banks won’t put out, because of seasonality,” Pitcher said.
SharpShooter Funding was not deterred by that. “We were really able to gain in-depth trust and visibility into this merchant from the first call to the last call. There was never a problem with him mixing up stories. Just the honest truth. From his references to his landlord, everyone involved made it clear he was here to work with us and not to play games,” Pitcher said.
Pitcher was impressed by the business owner’s work ethic. “He’s a roll-up-your-sleeves entrepreneur who didn’t borrow $1 million from his father. No bank loans. Six years ago, he rolled up his sleeves and made it work. Now he’s in a situation where banks won’t lend to him. But we will,” he said.
The merchant’s bank statements also made sense to the funder given their consistency, predictability and transparency. “Whenever we ask for finances from someone and that merchant can get them to us in an organized fashion in less than an hour, it speaks wonders. It means they’re honest and ready to play ball. And that’s what we want,” Pitcher exclaimed.
The merchant plans to use the capital for an expansion into a new food product line. If he pays off the advance early the funder will lower the rate.
Rapid Capital Funding Acquires American Finance Solutions
October 8, 2014
Miami, Florida-based Rapid Capital Funding will acquire Anaheim, California-based American Finance Solutions today in perhaps one of the most significant deals in merchant cash advance history.
Rapid Capital Funding, not to be confused with RapidAdvance, is led by the company’s founder Craig Hecker. Hecker and AFS’s CEO Scott Griest broke the news to me on a call together. “It’s a roll-up,” Griest said. AFS will continue to operate under their brand name for the time being and Griest will remain a leader in the company.
Meanwhile, the operations of the two companies will begin to merge, with Hecker confirming already that their head underwriter, Andrew Hernandez, was in California getting up to speed on AFS’s operations.
The news comes less than five months after American Finance Solutions struck an equity deal with CapFin partners. I am unsure if CapFin is still involved in the company.
Griest and Hecker were both excited about working together. “Griest has done a great job managing the sales partner channel,” Hecker said. Griest will continue to develop those relationships for the company.
This is the first major merger in the industry. Historically, just about all of the equity deals in merchant cash advance have been acquisitions by institutional investment groups. This is a consolidation.
RCF, while based in Miami, has an office in New York City. The AFS deal puts them on the ground in the 3rd major industry hub.
The two executives hinted that this deal was just the beginning.
Why Lexington Capital Holdings is Expanding Into the Real Estate Business
September 24, 2025Lexington Capital Holdings is expanding beyond small business lending and into real estate, the company recently revealed. Lexington, a Long Island-based financial marketplace and brokerage led by CEO Frankie DiAntonio, is launching Lexington Estates to buy, sell, rehab, and hold properties long term.
According to DiAntonio, deals involving real estate have already been a part of their regular broker product mix for a long time, but when deciding whether or not they wanted to lend against real estate on their own or become the actual buyers and builders, they felt the latter would be more impactful. A syndication fund for these real estate deals, for example, will be open to employees of the firm to participate in. Lexington’s existing operation already has about 50 sales reps. Two from that group will move over to the real estate side to join a number of new hires they’re bringing on board to carry this plan out.
“Business is a team sport and I wouldn’t have been able to do any of this without the amazing Lexington team behind me,” DiAntonio said of the company’s success to-date.
Lexington Estates is already closing on its first property on Long Island. While they will make their focus local right out of the gate, they plan to work on deals both residential and commercial throughout the United States within 12 months. DiAntonio cut his teeth on real estate deals by participating in them personally outside of his business and now he’s making it a corporate endeavor. Whether it’s residential, retail, office space, industrial space, or anything else, they plan to evaluate it on the merits of the potential profits.
“I’m looking for deals,” DiAntonio said. “I’m looking for what’s the best bang for our buck.”
DiAntonio views this ambitious plan as one of absolute necessity given the challenges that the younger generation faces with the cost of living going up.
“I strive so hard to put my people in a position where they can make more money than the average American because you can’t even live the average American life and be average anymore,” DiAntonio said. “You actually have to be great just to live an average American life.”
Lexington Estates plans to officially launch on October 12th.
Capital Gurus Launches Affiliate Portal 2.0: AI-Powered Transparency, Speed, and Growth for Partners
September 2, 2025Las Vegas, NV, September 1, 2025 — Capital Gurus today announced the launch of its Affiliate Portal 2.0, a next-generation platform designed to strengthen trust, increase speed to funding and affiliate revenue share payouts, and enhance both customer and partner experiences through advanced technology.
The upgraded portal introduces real-time analytics, AI-driven recommendations, and a streamlined dashboard, empowering affiliates to perform at their best while helping small businesses access capital more quickly.
Building Trust Through Transparency
Capital Gurus Affiliate Portal 2.0 delivers clear, real-time visibility into lead status, funding progress, and commission tracking. Affiliates can now monitor every stage of the funding process, ensuring confidence and clarity in their earnings.
Speed to Funding and Payouts
With automated workflows and improved underwriting integrations, small businesses referred through affiliates can secure funding faster than ever. Commission payouts are also accelerated, giving partners access to their revenue share in as little as a few days.
AI to Elevate the Customer & Partner Experience
The portal leverages AI-powered insights to:
• Automated underwriting
• Marketing support to upload bulk files
• Co-branded and White Labeled experiences available
Analytics Dashboard for Smarter Decisions
A new affiliate performance dashboard enables partners to track:
• Lead volume and conversion rates
• Funding speed and approval metrics
• Revenue share earnings over time
These insights enable affiliates to refine their strategies and optimize returns.
Driving Growth for Small Businesses and Partners
“Our mission with Affiliate Portal 2.0 is simple—give our partners the transparency, tools, and technology they need to help small businesses thrive while maximizing their earning potential,” said Bruno Santos, Co-Founder at Capital Gurus. “This upgrade is not just about technology—it’s about building trust, increasing speed, and empowering success.”
Availability
Affiliate Portal 2.0 is live now for all current partners. Influencers, creators, and industry advocates who serve small business audiences are encouraged to join the Capital Gurus Affiliate Program.
📌 Learn more and sign up: Visit Our Affiliate Page
Media Contact:
Michael Tryon
Head of Partnership
Capital Gurus
mtryon@capitalgurus.com
LightSpeed Capital Has Over $100M in MCAs on Balance Sheet
August 5, 2025LightSpeed Capital, the MCA division of LightSpeed Commerce, has over $100M in merchant cash advances on its balance sheet, according to the company’s latest quarterly earnings report. The POS company reported that LightSpeed Capital’s revenue grew 34% year-over-year.
The company’s balance-sheet-driven approach has made them relatively conservative and cautious with originations growth. For example, in the preceding quarter, Lightspeed CFO Asha Bakshani said “There is a lot of opportunity. We can move faster if we wanted to. When we look at our peers, for example, they are giving out 1% of their [Gross Transaction Volume] in merchant cash advance. Lightspeed is well below that. 1% of our GTV would be almost $1 billion in merchant cash advance. So when we think about the opportunity, it’s there. It’s just that in this macro, we want to move carefully on a product like Capital. Like I mentioned earlier, our default rates are in the very low single digits, and we want to keep it there.”
Heron Raises $16M Series A to Bring the AI Revolution from Silicon Valley to American Businesses
July 15, 2025Backed by Insight Partners, Heron automates document-heavy workflows in insurance, lending, and finance — bringing reliable AI to businesses and allowing humans to focus on complex tasks
Heron, a startup using AI to automate workflows in business lending, equipment finance, and insurance, has raised $16 million in Series A funding led by global software investor Insight Partners, with participation from existing investors Y-Combinator, BoxGroup and Flex Capital. The Series A will support Heron’s next phase of expansion, helping the company scale its AI-driven solutions to more segments.
While many AI startups target developers or other technologists, Heron is at the frontier of deploying AI into real-life business operations in traditional industries like lending, banking, and insurance. Heron’s mission is to free up humans to focus on judgment-based work and complex edge cases while software handles the repetitive, monotonous work. Heron focuses on serving companies without large engineering departments, enabling more businesses to reap the rewards of the rapid advances in AI.
Heron’s system can automate time-consuming manual workflows end-to-end, completing tasks automatically or flagging edge cases for human review. That reliability has led many customers to fully offload entire processes to Heron — freeing up their teams to focus on critical work.
For example, SMB lenders employ teams of underwriting analysts that spend hours on repetitive intake work — scanning email inboxes for submissions, downloading and renaming files, checking packet completeness, manually entering data into CRMs, and running basic eligibility checks. Using Heron, these hours of work can be accomplished in seconds, and with higher accuracy, full auditability, and no manual overhead.
This focus on reliability and solving problems end-to-end has attracted more than 150+ customers to Heron, including insurance carriers and FDIC-insured banks, and enabled the company to process over 350,000 documents per week. One lender cut submission-to-decision time by 60%, while an insurer used Heron to automate over 80% of its inbound submission triage.
“Anyone who tells you they use AI to automate work with 100% accuracy is probably lying to you. Instead of chasing accuracy, we focus on clearly understanding where our software is successful and where humans still need to review. This allows customers to use Heron in situations where millions of dollars are at stake and reap the rewards of the AI revolution in a reliable fashion that drives business outcomes,” said Johannes Jaeckle, co-founder and CEO of Heron
Founded in 2020 by Dom Kwok, Jamie Parker, and Johannes Jaeckle, Heron launched out of Y-Combinator’s Summer 2020 batch, initially building products for financial services companies with earlier generations of AI in the pre-ChatGPT era. The company eventually landed on a core insight: traditional industries weren’t waiting for flashy new tools — they were drowning in unstructured data, and paying millions of dollars a year to deal with it. In 2023, as LLMs matured, Heron pivoted to focus on AI document workflow automation. With minimal outside capital, the team tripled annualized revenue in 2024 and has continued to expand its presence in insurance and specialty finance this year.
“Heron’s AI models with vertical specific context automate the end-to-end data processing workflow, enabling automation and driving competitive differentiation in industries where speed to decisioning is of the essence,” said Philine Huizing, Managing Director at Insight Partners. “Heron’s founding team—Johannes, Jamie, and Dom—are an experienced trio that has proven their ability to adapt and execute. We’re thrilled to partner with them and the entire Heron team as they continue to scale up.”
The new capital will be used to scale Heron’s presence in insurance, equipment finance and SMB lending, while expanding into adjacent verticals that have shown demand for Heron’s solution. The company plans to grow its engineering and go-to-market teams in New York and London, and continues to invest in internal AI Tooling to enable a small team to serve more and more customers.
“We’ve proven we can win in one segment,” said Jaeckle. “Now we’re going workflow by workflow, industry by industry — giving people hours back in their day by eliminating time-intensive manual work.”
About Heron
Heron automates document-based workflows across industries like lending, insurance, and equipment finance. By turning unstructured documents into structured, actionable data, Heron helps companies process information faster, more accurately, and with less manual effort. Heron is based in New York and London, with the team bringing a wealth of experience from top-tier tech companies including Facebook, Spotify, N26, Revolut and Taptap Send.
Learn more at herondata.io
About Insight Partners
Insight Partners is a global software investor partnering with high-growth technology, software, and Internet startup and ScaleUp companies that are driving transformative change in their industries. As of December 31, 2024, the firm has over $90B in regulatory assets under management. Insight Partners has invested in more than 800 companies worldwide and has seen over 55 portfolio companies achieve an IPO. Headquartered in New York City, Insight has offices in London, Tel Aviv, and the Bay Area. Insight’s mission is to find, fund, and work successfully with visionary executives, providing them with tailored, hands-on software expertise along their growth journey, from their first investment to IPO. For more information on Insight and all its investments, visit insightpartners.com or follow us on X @insightpartners.
Edge Capital Expands Credit Line with Plains Commerce Bank, Increasing Lending Capacity
April 25, 2025
Boise, ID – 04/23/2025 – Edge Capital is pleased to announce a significant expansion of its credit facility through a strengthened partnership with Plains Commerce Bank. This increased credit line enhances Edge Capital’s ability to meet rising demand and provide more flexible funding solutions to its growing network of partners and clients.
The expanded warehouse lending line through Plains Commerce Bank allows Edge Capital to offer greater loan availability, faster turnaround times, and continued reliability for businesses seeking strategic financial support.
“We’re proud to deepen our relationship with Plains Commerce Bank,” said Dusty Wasmund, Chief Operating Officer of Edge Capital. “This increased capacity means we can better serve our clients, scale with demand, and continue delivering on our promise of speed and flexibility in lending.”
Edge Capital is actively seeking new partnerships and welcomes inquiries from brokers, lenders, and businesses interested in working together.
To explore partnership opportunities, contact us at partners@myedgecapital.com
Plains Commerce Bank now offers Plains Pay (www.plainspay.com) for seamless payment solutions and competitive warehouse lending lines to support the evolving needs of lenders in the fintech sector. Contact them today at sales@plainspay.com.
