[CO1]

Its so annoying! Everyday I seem to come accross a new company that does the samething that we all do! As soon as I start talking to someone; and than right when i am about to close they take my contract and send it to the next guy over and than I am at lost of all that time because another company plays with my factor rates or hold backs and than i have to price match my own deal I did before and visa versa the most times i tryed was 6 times and yet I still couldnt win! How about everyone else? Is it my time to say good bye to this Industry and leave what i have been doing for such a long time or do we need some type of alliance!!

[Capital Stack]

This would definitely be the wrong time to leave the industry. This is a potentially $5billion annual industry next year.

You heard it here first!!!

You'd miss all the fun. Anyway all these new player doesn't mean they'll survive or succeed. Having a niche, probably is the only way to take some market share.

[isaacdstern]

Agreed David! This is absolutely the wrong time to leave the biz....there has never been more demand then right now

[Chambo]

This would definitely be the wrong time to leave the industry. This is a potentially $5billion annual industry next year.

You heard it here first!!!

You'd miss all the fun. Anyway all these new player doesn't mean they'll survive or succeed. Having a niche, probably is the only way to take some market share.

$600-700 million to $5 billion in one year? Like Nancy Reagan said JUST SAY NO TO DRUGS!

[Capital Stack]

Chambo, i guess you better brush up on your reading on the industry.... Wall st journal did two pieces last year estimating $1bil last year going to 2-3 $B in about 3 year projection. I say they were wrong on crunching those figure's because they didn't incorporate the ACH bonanza. Guess what 5 million business accept credits cards of which consisted the 1B number last year. Now 25 million potential customers qualify for bank cash flow program. Your total market potential expanded five times.

And the Forbes piece last week with MCC, that also talked about $5billion dollar figure shortly. Stay tunes and informed, fortunately for you chambo you heard it here first.

[Finance1]

There's a bit of a perfect storm for growth going on right now. Banks haven't yet and probably have zero intention of taking on any risky paper. Especially unsecured stuff. They will continue to focus on their "version" of small businesses which is 5-10M+ in annual sales.

The economy has vastly improved from the abyss and appears to have some footing. It may not feel "great" but that's because most regular people are still hanging on to the idea that what we saw from 02-07 was "normal". We are in the prime of the "new normal" as Pimco's Gross and El Erian like to describe it.

The deep recession flushed the majority of failing businesses out of just about every SIC code we deal with (there are always plenty of weak businesses but just not near the numbers compared to 08-11).

Businesses as a whole are feeling a little more confident or at least comfortable nowadays as they have adjusted to the "new normal". This helps them feel more secure about borrowing money.

The MCA/Loan industry has finally made risk based pricing more mainstream so the better credit / more stable businesses are more willing to get involved and not just the desperate.

It's not all just about credit card sales so just like the points already made in this thread, the pool of prospects just swelled basically overnight.

I've often thought that the reason that the MCA space didn't experience exponential growth was the lack of risk based pricing. The under served market was the higher quality prospects for years until recently. So now there is a combination of risk based pricing AND loan programs for companies who don't take cards or even those that do have a choice.

Our industry is loaded with capital too. There is no shortage of that. That's for sure. This is the main driver for innovation and identifying niches. There has also been mostly favorable press about this industry over the last 12 months. The next couple years will define the future. If this space gets mainstream acceptance from the business owners then all bets are off as to how big it can get.

[Chambo]

Chambo, i guess you better brush up on your reading on the industry.... Wall st journal did two pieces last year estimating $1bil last year going to 2-3 $B in about 3 year projection. I say they were wrong on crunching those figure's because they didn't incorporate the ACH bonanza. Guess what 5 million business accept credits cards of which consisted the 1B number last year. Now 25 million potential customers qualify for bank cash flow program. Your total market potential expanded five times.

And the Forbes piece last week with MCC, that also talked about $5billion dollar figure shortly. Stay tunes and informed, fortunately for you chambo you heard it here first.

Blah, blah, blah.....go to rehab man....

[MCNetwork]

Blah, blah, blah.....go to rehab man....

Lol! Too funny!

[FactorExchange]

We are contacted by new lenders daily to join the exchange. So yes, they seem to be popping out of no where. What concerns me is that we have had meetings with a few large venture capital companies who seem to want to suck the air out of the room by attempting a roll up. The interesting thing about our space seems is the complete lack of marketing prowess and innovation that exists in the upper echelons of the industry. This motivates the wide eyed would be MCA entrants to come in and shake things up. It is a strong possibility that an entrant with enough cheap capital and a hi degree of marketing acumen can come in and change the industry. That being said I too agree that leaving the industry at this moment after building a base would be an extremely short sighted move. Hang on tight and enjoy the ride CO1.

[Chambo]

. That being said I too agree that leaving the industry at this moment after building a base would be an extremely short sighted move. Hang on tight and enjoy the ride CO1.

All the additional competition doesn't hurt either. Makes people actually work and produce the best products possible. You think folks would be coming out with 1.25's and 12-15 month deals if they didn't have to in order to save market share and stay competitive?

[FactorExchange]

If you look at a typical proforma in this industry it is very clear that 12-15 month 1.25's are not sustainable. When you couple the current cost of capital and the increased number of "life events" over a term that long, these companies are setting themselves up for losses down the line. That being said these providers have a wealth of data to build financial models on and a few of them in-particular sell the paper right away so its of no consequence to them in the short term. My question is what will the firms purchasing the paper do in the future when we have a down turn and they are saddled with losses on the long term deals? I suspect we will go right back to the good old 1.39 over 6 month deals that this industry was founded on. We write a good amount of business and I can tell you that the average MCA/ACH deal through the exchange has not moved too far off center over the last few years. The big difference I am seeing is the amount of fees being charged up front by the lenders in the form of "origination fees" to offset the risk. Just my 2 cents.

[CO1]

One company i was working at called AAF had no fee's we had nothing tagged along with our deals but yet people had been so much that they were scared to do anything and the termonolgy of "interests rate" is still stuck on peoples mind we need them to change the terms to a factor rate so they understand and most people know the product inside out and yes they are still scared to do things again.

[cashguy]

chamblah, That's all u can say blah blah. CS broke down specific data , point of references , and a real argument. And that's what u say blah go to rehab.. you should check yourself into 12 step.

[Chambo]

Until all these Advance/Loan, Funding companies start reporting earnings and opening up their books to public view (which they will legally have t do if they choose to go public), then everything else we hear is hearsay and smoke & mirrors.

[Chambo]

In my opinion, I don't see what the big deal is about disclosing how much business you are doing? Are you hiding revenue form the government? Screwing your partners? Your investors? what?

Wouldn't you want to l;et it be know you are omne of the top five funding companies in America if it were true? NOW....if you are simply beating your chest and lying your ass off about your numbers-yet still bragging to be "one of the leaders...", then that's a different arena