Codat’s Partnership with Moody’s Brings Real-Time Merchant Accounting Data to Lenders
January 10, 2022
Codat and Moody’s Analytics are partnering to bring the fintech’s API software into Moody’s CreditLens solution. The move will enable Moody users looking to fund small businesses the ability to access and manage all of the accounting data for the respective merchant looked to be funded.
Along with an effort to increase efficiency in the approval and funding processes, both companies seem to hope that the partnership will also improve access to capital for small businesses across the US.
“We find ourselves in a time of rapid change, where new approaches to financing and technology are becoming increasingly important to small businesses,” said Peter Lord, CEO & Co-Founder of Codat . “Moody’s Analytics has impressive global scale and reach, so this partnership holds the potential to meaningfully reverse the credit crunch facing SMEs while opening up new profitable lines of business for financial institutions.”
“Together we will be able to extend the benefits of Codat’s two-way flow of financial data to more lenders and financial institutions, allowing them easier access to a wider data set to make high-quality, data-driven credit decisions,” said Lord.
CreditLens is a “credit lifecycle management solution” with access to large amounts of data from across the lending space. Codat’s software will enhance data transferring in the CreditLens platform by offering real-time accounting data on merchants that is instantly accessible by Moody users.
“We are excited to welcome Codat as a new accounting data aggregation technology partner to boost the value of Moody’s Analytics lending solutions,” said Eric Grandeo, Product Head for Moody’s Analytics Lending Solutions.”Codat provides a seamless interchange of real-time data to enable valuable credit insights and predictive capabilities.”
“We are both dedicated to helping financial service businesses gain [a] deep understanding of their client’s risk and behavior, and make better decisions based on real-time accounting, banking, and commerce data,” Grandeo continued. “Ultimately, the partnership will afford small businesses across the U.K and U.S. access to more credit options, opportunity and growth.”
Kabbage Co-founder Rob Frohwein Steps Down from the Company
January 6, 2022
Rob Frohwein, who served as the CEO of Kabbage for more than a decade, has left the company. A post he published on social media revealed that his last day was December 17th.
“I didn’t make a big deal – the company has always been about our customers & our employees – and never about any person,” Frohwein said about the quiet exit.
The move is not altogether unsurprising. American Express acquired Kabbage in August 2020 after covid heavily disrupted its small business financing business. Amex first reintroduced Kabbage as a checking account brand and only just recently resurrected its funding operations.
That re-emergence was the catalyst to move, according to Frohwein.
“Why now? Lots of blah blah blahs but it’s the right time,” he wrote. “We’ve relaunched our products with Amex. Now, it’s time to fully devote myself to being an entrepreneur once again.”
Frohwein has kept busy on the side as an advisor & investor in SentiLink, the vice chair of StimLabs, and the CEO of Drum Technologies, Inc, according to his profile, but he apparently has even more plans in the works.
“So what now? Well, I’m pretty excited for what is next. Keep a lookout!”
The benign salutation may actually be a nod to what his next venture is. We’ll see…
Lenders Love One-Man Broker Shops, Rookie Broker Finds
January 5, 2022
“After meeting so many people at the Broker Fair in New York City, I was like, ‘you know what, now is the time for it. I’m young, so let’s take the risk and start my own company.’”
Matt Dolecki, a 23-year old entrepreneur who owned and sold two businesses before he graduated high school, is taking the young hustler’s mindset to the alternative finance world. Just this week, Dolecki started his own brokerage; dubbing it Opulent Capital.
Although Dolecki wants to start funding deals immediately and create relationships across the space, he is aware that he needs to also focus on honing in on the foundations of his business if he wants true success.
“I think a lot of people when they enter this space try to grow too fast and too big too quickly,” he said. “I’m not here to grow extremely fast or extremely big. I’m here to establish a well-rounded company and not tarnish my work just trying to grow fast.”
After interning at a funding company after college and subsequently working for a commercial collections agency, Dolecki believes his experience seeing all sides of the process will set him aside from other brokers.
“I have enough knowledge and information for the merchant to not just broker them the deal, but inform the merchant and let them know exactly what they’re getting, what’s possible for them, and what’s the better option,” Dolecki said.
“I have the debt collection side, and I’ve worked in [small business funding], so I have a really well rounded knowledge of how this whole thing works. If someone were to default, I know exactly which way to go. I can guide the lender on exactly which way to go, I have all the contacts on both sides, lenders and brokers, as well as many debt collections agencies. So I can help lenders not only get business, but retain business and get back lost revenue.”
Not only is Dolecki confident that his experience will set him and his company aside from competitors, he also believes his strength in numbers, or lack of, will allow him to operate a smooth show.
“I’m a one man shop,” said Dolecki. “I’ve talked to a lot of lenders, and they like the idea of having one person to deal with. Information is directly to the source, directly to me and directly to the merchant. It’s an easier form of communication. Every lender I’ve talked to agrees that 90% of their best selling ISOs are one man shops.”
When speaking on creating an image for his company from the merchant’s perspective, Dolecki spoke extensively about different types of marketing. He says that a strategy seemingly based on the business owner’s age can determine what type of communication should be used to pitch that particular merchant.
“If you are trying to reach out to small business owners over the age of 60, most likely a call will be more beneficial rather than investing in marketing or SEO,” said Dolecki. “Now there are so many young business owners who all love technology and doing things online, so building a platform where you can use fintech to apply for loans and search different loan options would be much more beneficial to the younger business owners.”
“I think a good mix of using fintech, algorithms, and tech, but also cold calling and [even] reaching out by mail is an effective way of trying to find that perfect mix of using both types of merchants.”
Dolecki has received support from other brokerages in the industry and claims without help, he would never be in the position he is now.
“Shout out to Porsha and Mercedes Brooks at Brooks Partners Finance,” said Dolecki. “They’ve really been a big mentor for me starting out, and helping me to get the ball rolling. I’m now calling merchants, signing on as an ISO with different lenders, and still just getting started.”
Brokers who Utilize Fintech are Here to Stay
December 23, 2021
“I don’t think the industry would really be the same if we didn’t have brokers anymore.”
Dave Stewart, who was recently promoted to Sales and Partnerships Manager at Idea Financial, spoke to AltFinanceDaily about the role brokers will play in the future of business financing. With so many different kinds of innovation being offered in the financial world through technology, Stewart shared his thoughts on how brokers, funders, and merchants can get the most out of a technology-infused lending environment.
“We think about the whole fintech thing, everything getting technology based, and that there’s a missed opportunity for the human touch,” said Stewart, when asked how technology will influence the way merchants apply for capital. “There’s a lot of clients out there that can go online and fill out an application, but they don’t understand the in’s and out’s.”
“When [the merchant] doesn’t understand how everything actually works, they usually fall back and seek a broker at some point in time.”
Stewart highlighted how from the lender’s perspective, the value of brokers is in being the face to the experience of purchasing a financial product. He described it as someone who can guide the merchant to the right type of financing and then through that specific funding approval process.
“I think there is value in the experience,” said Stewart. “I don’t go to a restaurant to cook my own meal. I go to a restaurant because the service is going to be great, the food is going to be great, and hopefully I have a great experience, and I think that’s a great example of what the broker does.”
Despite believing that the broker’s role in financing is invincible to fintech’s innovation in lending, Stewart didn’t dismiss the value of understanding and leveraging different types of technology in order to be competitive.
“There’s an art to being a good broker,” said Stewart. “There are a lot of people who are not tech savvy and are just monster brokers or monster sales people, but they definitely need or rely on somebody else to explain the technical aspects.”
Centrex Software Announces New Relationship Building Technology at Broker Fair 2021
December 22, 2021Costa Mesa, CA— Finance technology (FinTech) in the traditional and alternative business finance industry is seeing a massive enhancement with the release of new technology from Centrex Software.
Centrex Software, a dedicated business lending CRM and loan/advance servicing software platform that brings multiple technologies all under one roof for direct funders, brokers, and investors, experienced 22% growth from 2019 to 2020 and 35% growth from 2020 to 2021, during a global pandemic. With that growth has come quite a bit of new thinking out of the Centrex Software management team.
When it comes to the business lending space, FinTech companies spend huge amounts of time focused on how to drive more users into their software. This strategy makes sense as it is what a large operating software company is required to focus on to generate revenue. “But what about our customers’ customers? What if we spent more time focused on driving our customers’ customers not to our software, but to our customers’ software? In our business, we fail if our customers can’t engage, retain, and sell to their customers. We want that relationship to thrive and grow so we have built technology to aid that,” says Trey Markel, Senior Software Specialist with Centrex.
In realizing there was a tech need for this new way of thinking, Centrex Software built a mobile app that is white labeled to Centrex Software customers so they can offer more relationship retaining and building solutions to their customers. Keith Nason, President at Velocity Funding Group, and a Centrex Software customer, explains, “Trey, Michael and the Centrex team are going to put my brand in the pockets of every single one of my customers. It was an entirely new strategy that you simply don’t see from other software companies, and it should create customer engagement like we have never seen before.” The new white labeled mobile app has a few features that will really put your marketing hat on. First, the white labeled app is fully integrated with Plaid so that pre- and post-funding, Centrex clients can actually link their banks accounts and manage their finances. On top of that, Centrex Software has an admin portal where Centrex clients can manage all their app users. One of the best parts is that, in the admin portal, Centrex clients will have the ability to send push notifications to smart watches and to mobile devices that can communicate to the end mobile app user. Plus, there are several other features that keep mobile app users engaged with Centrex clients and the broker partner via the mobile app.
In the same spirit of engaging more efficiently with customers, the Centrex team also built a WordPress plugin that allows its customers to build “Smart Applications” right on their website. Michael Lindsey, also a Senior Software Specialist with Centrex expressed, “Our clients need more tools that are forward facing to their customers to help make faster decisions and offer a better more automated experience.” Taking the automated application process a bit further, Centrex integrated the WordPress plugin with Universal Credit Services to pull and analyze credit data, and Plaid to pull and analyze financial data. This allows Centrex Software customers to automatically underwrite and create offers right on their website. The WordPress plugin will communicate all info and decisions into Centrex Software during each step of the process. Lastly, for those Centrex Software customers using both the WordPress plugin and the white labeled mobile app, once an application is completed by the business borrower on a Centrex Software customers website, it will automatically create a user for the mobile app in real-time. The end result is a completely seamless and streamlined business borrowing experience.
Perhaps the most impressive part of the two new technologies being released by Centrex Software on January 1st of 2022, is that in order to take advantage of the new tech, you don’t even need to be a Centrex Software CRM customer. “We understand that the Centrex CRM is only one option for funders and ISO’s out there. We also understand that there is much more than just CRM that is needed to build a successful finance business. Because of that, we built the WordPress plugin and the mobile app in an API based architecture so that any finance company using any CRM with an API can utilize the new Centrex technology. We wanted to capture more of the market with unique FinTech solutions, offering CRM alone can only get us a to a certain point.” says Trey Markel.
Needless to say, Centrex Software has really stepped it up as a full circle FinTech solution provider to the finance industry. Centrex Software will also be launching its new open REST API and amortization calculators in the new year to expand their tech offering. You can reach Centrex Software at www.centrexsoftware.com or email media@centrexsoftware.com
RadioShack is Launching a Crypto Swap
December 19, 2021
If you had RadioShack on your 2021 DeFi bingo card, congratulations, you’ve won. The company announced that its “mission is to be the first protocol to bridge the gap in mainstream usage of DeFi” and it plans to do this, apparently, by launching a swap.
RadioShack wants to compete with the likes of Uniswap, a smart-contract-based crypto exchange where users can “swap” tokens without having to register on a formal exchange like Coinbase.
The business is a gold mine, according to RadioShack.
“The concept of a swap stands out first and foremost as the place of low-hanging fruit – fruit that is spinning off incredible levels of net profit,” the company said. “Profit not just from speculation like Bitcoin or other cryptocurrencies, but ones born out of trading fees. Some existing swaps like Uniswap or Sushiswap reportedly are doing $1-$7 million net profit per day! They are the current profitable forces of nature in the DeFi world.”
Use of a “swap” is how tokens issued by the ConstitutionDAO crowdfunding saga leaked out into the publicly tradeable marketplace, for example. What was supposed to be a “governance token” to vote on where a copy of the United States Constitution would be held, instead turned into a tradeable novelty asset (like pogs or baseball cards) with a soaring value, all because of decentralized swapping. More than $100 million worth of the novelty governance tokens stemming from the failed bid to buy the Constitution were traded just in the last 24 hours alone, according to Coinmarketcap.com.
“RadioShack DeFi is focused on the early majority,” the company said. “It will become the first to market with a 100 year old brand name that’s recognized in virtually all 190+ countries in the world.”
EIDL Applicants Still Waiting for Funds as Deadline Approaches
December 16, 2021
There is a major pileup of applicants waiting to hear back from the SBA regarding EIDL applications, according to Iron Capital Equities, a fintech firm who owns websites that help businesses through the EIDL application process. According to a press release by the company, many applicants who have not yet received funding seem to believe they’ve been ghosted by the SBA.
The EIDL deadline to file an application is December 31.
“90% (9 out of 10) of our 400 client applicants are still in limbo, with no update regarding the status of the funds,” states co-founder Matthew Elling. “The short-term economic outlook from small businesses is dim, so these funds are highly sought after.”
Elling insisted that he is in constant contact with his customers, and says his company is doing everything they can to service these clients who are playing the waiting game.
“Even though we are a financial technology company, we still ‘talk’ with our customers,” Elling continued. “We understand their struggles in a post COVID economic environment, we have provided them with advice on the SBA assistance like EIDL and the two PPP rounds for payroll and business expense assistance during and after the government-imposed lockdowns.”
EIDL loans were a beacon of hope for many businesses struggling to survive in the pandemic. This type of government funding isn’t a grant, and needs to be paid back by the merchant at a term of 30 years at 3.75% annual interest.
The Broker: A Sister Duo Gets Borrower-Centric
November 29, 2021
When the company she worked at was halted by pandemic woes, Porsha Brooks, then an MCA salesperson, was asked by her sister Mercedes how they could get together and pick up where her other company left off. “My sister approached me at that time saying, ‘well what is it you’re doing, I want some action in that’, then I said, ‘that action is kind’ve drying up— but we can do our own thing, we can start our own business.'”
“So, that’s what we did.”
While offering a suite of loan options to their clients, Porsha spoke with AltFinanceDaily about how her experience in sales, combined with her small business finance knowledge, has powered the creation of a borrower-centric lending product through their company, Brooks Partners Finance.
“As far as MCAs go, I’m not pro or against it, but at the same time, I know what they are,” said Brooks. “The industry for the most part, every MCA [funder], every broker, is pushing MCAs. Everyone is pushing MCAs. But I see that it really does do a detriment to businesses and business owners.”
Although Brooks Partners still writes MCA deals, that’s only if that is the best option for the client at that time. Brooks claims her company’s business model isn’t to push businesses into whatever type of loan makes sense for her company, but rather the opposite, using different types of tools to figure out exactly what loan is best for the borrower.
“If I have every option for that individual, I don’t have to push them into an MCA,” Brooks continued. “I can still get paid, and still do right by that business owner.”
When speaking about her past work, Brooks spoke about how coming up in an all-male environment was actually a motivating experience.
“They quickly judged, saying ‘you know, she’s a woman, and she’s probably not going to last here for too long, because they normally don’t’ and it turns out I did,” said Brooks. “Three months in, I rose to be one of the top salespeople at the firm. Within that time, I got the attention of both partners at the firm, and I would say about a year in, I was promoted to head their new banking department.”
But when the pandemic slowed the business down, it led to the genesis of Brooks Partners Finance. “I already had certain contacts, I had my foot in the door, and I had a taste for bank loans,” said Brooks.
“I’d say the biggest moneymakers for us are SBA and conventional [loans],” said Brooks. “We have a range of banks that we work with and we are able to give to individuals, not just existing businesses, but startup businesses too. We’ve learned the SBA world like the back of our hand. We’ve been studying this for several months, we basically have to know everything about how to get somebody approved for an SBA.”
With access to these types of loans being notoriously difficult for small businesses to qualify for, Brooks spoke about how teamwork between a broker and a merchant can lead to a plan for approval.
“We’re different [from] most brokers in the industry; we’re very, very hands on here. We stay on from the onset until the funding process. Now what we’re doing is we’re holding our clients’ hand. We’re telling them how they can get qualified, taking them through that process, we’re working with the lender, and not letting the lender cut us out.”
“We make sure that we stay in our lenders’ faces for our clients’ benefit,” Brooks continued. “Making sure we are always a part of that process and making sure things go smoothly, so we do get a lot of SBAs and conventional loans done.”
“I’m not just the ordinary middleman, I am supposed to help [my] client and guide them to their best loan option for their business,” Brooks continued. “If I don’t know where I’m sending them or don’t know if they’re going to be qualified, I am doing them a crazy disservice to my client. That’s where we differ.”
