[abfunders]

Amanda, I agree with you.
Problem is that most MCA shops completely and totally DISAGREE with your approach. There's no fiduciary responsibility (we don't work for the merchants), and most broker shops don't want small residuals - they want a minimum of 10 points plus PSF every time.
How many brokers here talk their clients out of factoring or don't present it, especially after they had a bad experience? So what about a LOC? Why not? "Because it pays peanuts." You can't expect someone to work on a particular model.

I talked to a client (friend of an ISO of mine, they're both in Crown Heights) a few weeks ago who is doing $100mm yearly, offered him factoring, and he said, "I don't want to diverge my AR."
I offered him 0 APR credit cards for $100,000 (no UCC), he said, "I could walk into me bank and get $150,000 UBLOC tomorrow, $100,00 is a joke." He's right, however I told him that would take a PG and likely a UCC.
I offered him the concept of an MCA (no UCC), he doesn't want to show me financials and wouldn't take rates like that.
The only thing he was interested in was his own idea: A large personal loan to his business (yeah, personal or business loan, take your pick) that would have a PG from a billionaire (not him). I haven't bothered following up.

Definitely goes both ways, but WE ARE NOT THEIR FINANCIAL ADVISORS! I, like many people here, am just a broker.

[WhoisKingsley]

Amanda, I agree with you.
Problem is that most MCA shops completely and totally DISAGREE with your approach. There's no fiduciary responsibility (we don't work for the merchants), and most broker shops don't want small residuals - they want a minimum of 10 points plus PSF every time.
How many brokers here talk their clients out of factoring or don't present it, especially after they had a bad experience? So what about a LOC? Why not? "Because it pays peanuts." You can't expect someone to work on a particular model.

I talked to a client (friend of an ISO of mine, they're both in Crown Heights) a few weeks ago who is doing $100mm yearly, offered him factoring, and he said, "I don't want to diverge my AR."
I offered him 0 APR credit cards for $100,000 (no UCC), he said, "I could walk into me bank and get $150,000 UBLOC tomorrow, $100,00 is a joke." He's right, however I told him that would take a PG and likely a UCC.
I offered him the concept of an MCA (no UCC), he doesn't want to show me financials and wouldn't take rates like that.
The only thing he was interested in was his own idea: A large personal loan to his business (yeah, personal or business loan, take your pick) that would have a PG from a billionaire (not him). I haven't bothered following up.

Definitely goes both ways, but WE ARE NOT THEIR FINANCIAL ADVISORS! I, like many people here, am just a broker.

That's why I said - how many of your Merchants know "money" and how to flip their cash - not many. They only know their
"craft" aka their business and not the financial portion of it when it comes to the capital resources they have so we ARE guiding them to the products we have available as brokers which makes us somewhat "advisors"

[abfunders]

If we're "advisors," IMHO we should be getting them the best rate, not making 10 points "upsell." Selling cash is not a broker, as I've said. How many appliance repairmen are "advisors" when they tell you the fix it and not get a new one? How many people know that Duracell batteries make all the off-brands (to keep their factories going) and have the same shelf life? (Amazon batteries are just Eneloops.) How many Gap salesmen tell someone to get the same shirt at a different store without the logo on it for cheaper?

Yes, I agree that most clients cannot flip their money fast enough for these. However, there are sometimes longer-term reasons to take a loss on this funding now (i.e. the other option is equity). We aren't their accountants or their advisors to know!

My opinion (and I've said this a few times) is that my responsibility to make the lenders like the borrowers (funders like the merchant), and each one approve of the deal on their side. That's the real job of a broker. Our responsibility is not to bring horrific deals to the funders, play by their rules (i.e. if they say "no fees" then don't add on fees). Obviously stacking a guy to death just to make money is irresponsible, but not because we're "working" for anyone, rather because our funders expect the merchant to finish the term, and ideally you should want your merchants to make money (since that's why you brought them to X funder and not Y)

However, most people just throw MCAs at them because they make "double digit commission + PSF." That's not doing the "job" as a broker or advisor, that's just selling an overpriced loan-like product.

[WhoisKingsley]

AND even if we have no fiduciary responsibility- and only "originators" of applications who "broker" submissions to applicable funders - receive a commission off doing little to nothing as such - then we shouldn't have the responsibility we have had in the years of growing the funding companies because they dont know what tf they're doing half the time.

aka claw-backs at 90 days when the UW makes the decision and has fiduciary responsibility
aka the enormous fees because a pop up funder utilizing the back office/operations of another to charge 8-10% for absolutely nothing.

All those who dont think they have NO fiduciary responsibility or advisory responsibility over their Merchants whether its 10k or 100k seriously needs to review what they are doing as a "job" or "career"

[brokerCompany]

AND even if we have no fiduciary responsibility- and only "originators" of applications who "broker" submissions to applicable funders - receive a commission off doing little to nothing as such - then we shouldn't have the responsibility we have had in the years of growing the funding companies because they dont know what tf they're doing half the time.

aka claw-backs at 90 days when the UW makes the decision and has fiduciary responsibility
aka the enormous fees because a pop up funder utilizing the back office/operations of another to charge 8-10% for absolutely nothing.

All those who dont think they have NO fiduciary responsibility or advisory responsibility over their Merchants whether its 10k or 100k seriously needs to review what they are doing as a "job" or "career"

Did you not own or work for another company when you sold MCAs? Did you see the light and realize there is more than MCAs?

[WhoisKingsley]

Did you not own or work for another company when you sold MCAs? Did you see the light and realize there is more than MCAs?

I still sell MCAs but if it doesn't fit it doesn't fit.

[mcaguru]

I still sell MCAs but if it doesn't fit it doesn't fit.

Hmmm

[brokerCompany]

I still sell MCAs but if it doesn't fit it doesn't fit.

LOL. Such Righteous indignation.

[WhoisKingsley]

LOL. Such Righteous indignation.

lol... I know It's like I'm polluting the waters and saving the manatees at the same time it seems right? Wait till you see my success videos