[jbrown]

One of our merchants. Dentist practice, sub 550 fico.

Rapid - $57k, 8 month MCA
WBL - $60k daily ach, 1.90/12 months
WG - $15k daily ach, 1.42/12 weeks
Yellowstone - $10k daily ach, 1.45/10 weeks

Don't post any nonsense about how this is an informed merchant and the stackers are like 2nd and 3rd home equity loans. The Hoppers are just burying the doctor until he goes BK.

[MCNetwork]

Does he have a lot of NSFs or are his statements clean? I'm curious to know how much of his monthly gross is going towards debt service. 40%??

[channin19]

1.90!

Who is WG?

[jbrown]

Statements have some issues. That is why we had him on a split.

Good guess on the % of revenue being taken. We have 10%. WBL 9.5%. WG 7% and YS 6.5%, total about 33%.

[jbrown]

World Global Financing. Cyril Eskenazi, CEO

[MCAVeteran]

10 week duration stackers? Wow...

[MCNetwork]

Statements have some issues. That is why we had him on a split.

Good guess on the % of revenue being taken. We have 10%. WBL 9.5%. WG 7% and YS 6.5%, total about 33%.

33% of revenue going towards MCA debt service can't be good no matter how you try to justify it. Most underwriting guidelines advise keeping MCA debt under 14%. This is a bad situation...

[Sean Cash]

10 week duration stackers? Wow...

this is new to you? There are companies doing 6 week deals.

[MCAVeteran]

6 week , 10 week, whatever the high rates durations and impact to merchant is nonsense - the merchant is equally responsible in taking these nonsense offers and illustrates that something really is broken out there on a macro level- if these were one off stories thats one thing but this is a daily occurrence now-

[Chambo]

it is as if people are taunting the Feds to come in and regulate. Daring them

[MCNetwork]

I love the 10-12 week stacks. Wham, bam, thank you ma'am!

[jbrown]

Funny you should say that. Before I posted this, I was contacted by, and I am scheduled to speak with someone next week in this department:

Division of Consumer and Community Affairs
Board of Governors of the Federal Reserve System

it is as if people are taunting the Feds to come in and regulate. Daring them

[MCNetwork]

Uh oh...don't throw your fellow funders under the bus!

[funding pro]

it is as if people are taunting the Feds to come in and regulate. Daring them

I'm confused, I thought you were with YS? Or am I confusing posters?

[1StopFunding]

WOW! This is absurd.

[Chambo]

I'm confused, I thought you were with YS? Or am I confusing posters?

I am at YSC. Not everyone there is a *****.

[Chambo]

WOW! This is absurd.

It is totall absurd...until some zealous politician decides to make his mark on the MCA industry and the predatory ways of multiple stacking.

[CashAdvanced]

There are plenty of merchants who take a second or a third position and have absolutely no trouble paying all 3. There are some businesses that can handle multiple advances as long as their cash flow is there and their intent is to make the daily payments. I'm not justifying the merchant taking 4 advances, just saying that a majority of them continue to pay all of them without defaulting, you just see the defaulted ones more often bc they stick out. Most of these owners need more money then they are being approved for by one company

[cashguy]

I don't know if this is good or bad. It's hard to draw parallels to other industries. Is credit cards a good example or bad one where everyone is stacking each other and not concerned about who is in first position. But that happens everyday.

[funding pro]

I'm not justifying the merchant taking 4 advances, just saying that a majority of them continue to pay all of them without defaulting, you just see the defaulted ones more often bc they stick out.

Ehhhh, that's bull****. You are justifying it. Whatever it takes to make you sleep better at night...

[AndyYSCISOdept]

it is as if people are taunting the Feds to come in and regulate. Daring them

I completely agree, but whats the solution? You going ot tell the reps who are able to collect the commissions on these deals to stop? That's never going to happen because the amount of greed among the haves and the have nots has saturated the industry. Its as if we are saying, "Who cares if the merchant goes out of business? I got 10 more lined up and I'm getting paid"

And don't think that I am busting out a "holier than thou" I have stacked many deals, but I don't do it without knowing that eventually something has to give.

[CashAdvanced]

Funding pro you are not very intelligent. If you having something to contribute to the conversation then do so, you think stacking a merchant makes it hard to sleep at night. Get real hah shmuck

[JSL23]

I have only been in this industry for 6 months so I don't claim to be an expert, I do however have some insight based on 12 years of overall B2B sales experience. This is a corporate culture based issue that starts up top.

I spent 4 months at a Broker/Lender whose name I won't mention and I hated it. They micromanaged(counting dials, locking the door at 9:05), the gave a lousy 400 draw and capped it at $1600(withouttelling you until you were there a week or so) offered zero training on Sales techniques or product knowledge..... but they did teach us how to stack!(as long as it wasn't behind them ofcourse). Most of the leads we were given were UCC leads which inevitably lead to stacking, the commission for the brokered deals were weak...It was a total ****show! I left after 4 months and I was one of the last men standing.

I am now at a Broker shop that also syndicates and it is much different. We try to do the right thing by our clients. Will we do second position-yes, but it stops there and we are trying to find Merchants using methods other than UCCS. The people I work with now tell me a lot of places are very similar to the chop shop I wasted four months at. If that's true, than how do you expect people not to stack. No base salary, lots of deals get buried after preapproval, leaving the Account Executive looking like a fool and most of all, there are millions of Merchants out there who can benefit from this but we all chase a small segment of them..like the dentist with 4 different advances for example. Those guys are fast and easy is all.

Why not increase the approval range and terms across the board. Expand marketing efforts. Encourage your Sales reps to go to trade shows and network. Utilize LinkedIn and Twitter. Do you realize this board is the same 10-15 guys having the same stacking debate over and over!? You guys are the so called leaders of this industry, right?! Stop talking about it and go back to the drawing board. This is a legit bubble...a lot of people can enter this industryand thrive, without stacking. Set it up so they can do it the right way. Just my opinion...

[Chambo]

"Why not increase the approval range and terms across the board. Expand marketing efforts. Encourage your Sales reps to go to trade shows and network"

Sure...you put up the money and take the risk. You can go to trade shows (I have been to three in my career) and meet -15-25 solid lead qualified merchants, or you can pick up the phone and get in contact with 300....WITHOUT the price of airfare and hotel.

[JSL23]

"Why not increase the approval range and terms across the board. Expand marketing efforts. Encourage your Sales reps to go to trade shows and network"

Sure...you put up the money and take the risk. You can go to trade shows (I have been to three in my career) and meet -15-25 solid lead qualified merchants, or you can pick up the phone and get in contact with 300....WITHOUT the price of airfare and hotel.

There are plenty of networking events and trade shows that cater to small businesses and every industry imaginable right here in NYC (or whatever city you are in). Why not hit 1 or 2 a month?! If you have to stay at a hotel........just write it off.

As far as risk goes, wouldn't the extra revenue make up for it. I'm not saying approve Merchants 200% of their monthly gross, just an increase for the ones that pose less risk.

How else to you guys propose to stop, or at least decrease stacking? Because dialing 300 UCCs a day and getting a couple of $10,000 2nd position approvals won't do the trick.