[Chambo]

I thought about this post yesterday as I received docs on a merchant who had 5 advances. I just don't get how the merchant thinks it is good and how FIVE STACKS cannot be looked at as predatory (like a pride of lions feeding on a gazelle). When does it stop?

This scenario is DEFINITELY a game of musical chairs. SOMEBODY is going to be left standing when the music stops.

[Lendinero]

I thought about this post yesterday as I received docs on a merchant who had 5 advances. I just don't get how the merchant thinks it is good and how FIVE STACKS cannot be looked at as predatory (like a pride of lions feeding on a gazelle). When does it stop?

This scenario is DEFINITELY a game of musical chairs. SOMEBODY is going to be left standing when the music stops.

Could not have said it any better. We turn away merchants like that all the time. It's just bad business.

[mfs01]

There are two things to keep in mind when considering stacking.
#1: Is it prohibited in the agreement with the funding company who is in first position?
#2: Will it help or hurt the merchant and funding company in first position? A good underwriter will make sure that the total $ amount being paid out per month by the merchant after getting the stacked advance will be a number that the merchant can withstand (taking into consideration the SIC and profit margins for that industry).

By not carefully reviewing these 2 things you not only hurt the merchant and the funding company in first position. You also risk a default.

[Eric S]

There are two things to keep in mind when considering stacking.
#1: Is it prohibited in the agreement with the funding company who is in first position?
#2: Will it help or hurt the merchant and funding company in first position? A good underwriter will make sure that the total $ amount being paid out per month by the merchant after getting the stacked advance will be a number that the merchant can withstand (taking into consideration the SIC and profit margins for that industry).

By not carefully reviewing these 2 things you not only hurt the merchant and the funding company in first position. You also risk a default.

You are dead WRONG. There is one thing to think about when stacking. Do not do it.

[Chambo]

There are two things to keep in mind when considering stacking.
#1: Is it prohibited in the agreement with the funding company who is in first position?
#2: Will it help or hurt the merchant and funding company in first position? A good underwriter will make sure that the total $ amount being paid out per month by the merchant after getting the stacked advance will be a number that the merchant can withstand (taking into consideration the SIC and profit margins for that industry).

By not carefully reviewing these 2 things you not only hurt the merchant and the funding company in first position. You also risk a default.

This is assuming:

1) the "underwriter" (and I use the term loosely) needs to be willing to do the math involved to figure out the margins
2) the ISO or rep involved gives a rat's ass about the merchant

[Eric S]

This is assuming:

1) the "underwriter" (and I use the term loosely) needs to be willing to do the math involved to figure out the margins
2) the ISO or rep involved gives a rat's ass about the merchant

Stacking is WRONG. It's simple. You should NEVER participate it in. NEVER. If you do, you are a scum bag and know nothing of business ethics.

[SBF]

I find that I am competing with stackers more and more... I had a deal come in where the merchant had an MCA balance. The merchant stated he didn't want it paid off, he just wanted more funds added on. He said he had an offer for a loan stack and he wanted one from me. I was able to educate him on the hazards of accepting loan stacks. Not only is it prohibited by his current MCA provider, but it will most certainly damage his future borrowing power and his reputation. Thankfully he understood the bigger picture and took my advice to simply payoff his mca and allow me to provide a larger one..

[achcash]

I find that I am competing with stackers more and more... I had a deal come in where the merchant had an MCA balance. The merchant stated he didn't want it paid off, he just wanted more funds added on. He said he had an offer for a loan stack and he wanted one from me. I was able to educate him on the hazards of accepting loan stacks. Not only is it prohibited by his current MCA provider, but it will most certainly damage his future borrowing power and his reputation. Thankfully he understood the bigger picture and took my advice to simply payoff his mca and allow me to provide a larger one..

I don't understand how you sleep at night telling merchants a full refi is a better deal than a grasshopper. At lease I give merchants options for a cheaper alternative through a 2nd position. Simple math. Run the numbers, you'd be surprised

[MCNetwork]

Stacking is WRONG. It's simple. You should NEVER participate it in. NEVER. If you do, you are a scum bag and know nothing of business ethics.

So you're saying half of the funders in our industry are scum bags?

[Eric S]

So you're saying half of the funders in our industry are scum bags?

Absolutely.

[Eric S]

If you do your job right, your merchant won't need to stack. Learn how to place your deals.

[achcash]

SBF - Simply payoff? Did you explain to the merchant that paying it off is a refi, and therefore he is paying double the cost on the balance on the factor and is actually more expensive than a grasshopper?

[achcash]

Haters gonna hate. Grasshoppers are here to stay

[GoodCustomerService]

These conversations kill me. It's always the fault of the funding company doing the stacking and never the broker or the merchants fault. Who forces the merchants hand? Not the stacker making the offer. The stacker didn't ask the merchant to fill out an app, submit it with paperwork, sign off on a contract, take the funds into their account, etc. Don't throw blame in one direction. What drives me crazy is how everyone here blames Pearl for their troubles when there are at least 10 other stacking companies that consistently advertise or post on this forum. What are their opinions on these threads? You know who you are. Chime in.

[CO1]

Back in the day, no one stepped foot into anyone else's deal. The balance had to be at 50% in order to do a new deal and the merchants knew this bit they would wait till there balance was even lower in order to secure financing. But Stacking only started appearing when people from outside the industry heard about high roi and inside salesmen were feeling greedy because they didn't get enough on commission an gathered a couple of there boys, family an went in head first, an of course processors took advantage as well with hidden fee's with statement fees of 20$ for a print out! This industry is filled of greedy little people, don't get me wrong, I have stacked a couple of times myself, but was I proud of it, no, because in the long run maybe I could have funded the guy an average 3.5 times now the odds are 1.5 an as the industry grows stacking will only get worse an in my opinion will make the industry fail, even if we are the market now. .an the only reason we are is because banks are still in the industry lending money to the big guys, an than we sell from bank, to funder, to underwriter, to merchant. An banks are happy because they still are making money. An as for the merchant I have only probably seen a handful get to the next level with the money we give, double dipping, stacking. It was all about ethics and morals now its how to make the fastest and easiest way.

[MCA Pioneer]

Incidentally, my fairly new high risk funding company - Superior Capital - will stack only when appropriate and only with a second. We fund nearly any industry to include attorneys, CPAs, online businesses, home-based situations, and more. We also pay commissions within 4 business hours, can approve files with open tax liens and a FICO down to zero.

Call today for an ISO package and work with the most experienced in the business and get paid the fastest with Superior Capital.

[CO1]

If the ExDirector of AdvanceMe says its fine. . I just say wow.

[HeatherF]

I do not believe Stacking is an acceptable procedure and we do not provide 1st and 2nd placements... and it is not because our credit facility does not allow us to as we are not backed by any bank. Being in the decline space/ or starter niche (whatever term is used) we see the clients that trickle down to us because they have stacked and now most funders will not consider them for financial options. There are few and I mean on the rare occasions that have positive balances. The main thing we hear from the agents is the merchant wants to consolidate it all because they can't handle it. I know people say that if done correctly and the profit margins are there the merchant can handle it but people are operating without set rules and guidelines (aahem..regulations) and doing as they see fit. My feeling and statement on it is such "Once a merchant stacks they are never again in the black"- it's true because it rhymes of course.

[JayBallentine]

The main thing we hear from the agents is the merchant wants to consolidate it all because they can't handle it. I know people say that if done correctly and the profit margins are there the merchant can handle it but people are operating without set rules and guidelines (aahem..regulations) and doing as they see fit. My feeling and statement on it is such "Once a merchant stacks they are never again in the black"- it's true because it rhymes of course.

A lot of solid points here. Ultimately, most businesses you stay in the "stack" cycle are forced to close their doors. We can do better.

[cashguy]

This guy Jay talking all these thing over this board. One day marketing the next doing paperless submissions the next whatever that crap was on Amazon now all of the sudden he thinks he is the know all about how business perform or underwrites. What have you actually done in this business.

Your agenda is to bash the industry and have people come to your nonsense site that is a gimmick calculator. Won't work you will fail like you have all over this forum/industry.

[JayBallentine]

This guy Jay talking all these thing over this board. One day marketing the next doing paperless submissions the next whatever that crap was on Amazon now all of the sudden he thinks he is the know all about how business perform or underwrites. What have you actually done in this business.

Your agenda is to bash the industry and have people come to your nonsense site that is a gimmick calculator. Won't work you will fail like you have all over this forum/industry.

Whats your name sir? Great to meet you.

In 2009 - as some here may be able to attest to, I'd made a futile attempt at addressing the problems as I see them... I failed. Most startups / 1st timers do. Eventually, I came back NOT to be a marketing consultant rather because there was a simple little widget I had that I thought would add value to folks regardless of the vertical. Incidentally I chose to start here... If you are on the phone with your internet leads in 20 seconds or less, you'll make more money. That's what I was offering.

While the tool was "useful" my mistake was in not realizing that it was a commodity and not something that people were feeling "pain about." So, I ended up doing a bunch of videos for guys, some consulting, etc.

Some people have made good money based on the stuff I have shared freely here. I've been happy to give. However, unfortunately most folks in this business have sought to aggressively "take from me." I find it weird that folks will reach out to me for help then get literally mad that it doesn't come a "rock bottom" prices. I've worked and suffered to acquire this knowledge, can't afford to give it away. I had a client I helped actually profit from my work and then tell someone else that "I was a bust... waste of money."

I began scratching my head... Then, I realized that as the market for the product expands, the same folks who were trying to use me will be the ones engineering the loss of jobs and the shut down of businesses on a massive scale. There are guys coming in from PayDay lending who specifically are looking to "stack."

Releasing my "book" was another fortuitous event. I learned that I was being a coward. Releasing the book was a way for me to showcase the fact that I honestly feel that I am the best merchant cash advance marketer in the world. The goal was to get consulting clients. Given THIS particular vertical - that would have proven to be a gigantic waste of time. When I shipped the preview release, I knew instantly that releasing the full piece was out of the question. So... I figured, I'd just aggregate and sell leads. Doing that would have been selling out.

I'm more risk averse than I have been in the past - so I "swore" I'd just not do a startup, make money, and blow it all angel investing in tech startups. Then I had some conversations with some people... here we are.

"Paperless submissions" are necessary and we'll certainly add that to our funnel to make it easier for folks to access funding quickly. You're referencing the time when there was a consideration to working with Funders Cloud. Here's the secret about MCA - one secret I think that holds some guys back. It's an all out every man for him or herself war out there.

The Calculator

It is fun to work on. We know people have 0 attention spans so we had to figure out the easiest 2 or 3 questions we could ask to render a powerful result. 5 people and about 40 hours later... This is only the beginning. We'll definitely continue to iterate on it and so the product will have "new branches." We're also working on a study which will show the effects of stacking and the rate to which it puts businesses under. To help that study gain visibility we are building an app that will allow you to simply enter a given city and see some stats on that city with regard to stacking.

If you are willing to bet that will fail at helping merchants get faster, cheaper, and more profitable merchant cash advances, then I'd encourage you to re-consider your position.

Look around you... No one has the merchants back. If not us then who? If not now, then when?

Stacking is GREAT for business. Stacking is BAD for America. Jobs are on the line here.

Do you disagree?

[Ryan Shiroky]

This guy Jay talking all these thing over this board. One day marketing the next doing paperless submissions the next whatever that crap was on Amazon now all of the sudden he thinks he is the know all about how business perform or underwrites. What have you actually done in this business.

Your agenda is to bash the industry and have people come to your nonsense site that is a gimmick calculator. Won't work you will fail like you have all over this forum/industry.

That aint the half of the arrogance either... I dropped this guy a line to board with us here at AmeriMerchant, to do MORE business... I am inside sales, but I run with a few ISOs as well... THIS guy, lol, hit me with some "Have your CEO call me" B.S. with his nose in the air... Yea, OK, cause he's gonna waist the time hes using to secure ridiculous amounts of money to talk to Jay... lol this guy kills me...

[MCNetwork]

Ouch. Pretty harsh.

[JayBallentine]

By the way... I had a meeting recently where this exact quote was said; "Merchants are scumbags." In light of your comments regarding our potential failure; what do you make of that quote?

[MCNetwork]

Yep you hit the nail in the head. It's good versus evil and evil outnumbers good 10 to 1! There are too many new Funders sprouting up that specialize in stacking. These firms set up a call center with 10-20 minimum wage sales reps and they utilize state of the art dialers that enable each rep to make up to 900 dials per day. And who do you think all these reps are calling? You got it! UCC lists. So the cycle works like this: 1) Reputable funders who are against stacking (aka the "good guys") spend a ton on marketing to acquire new, fresh merchants and fund them. 2) These merchants end up on a UCC list. 3) Stacking funders (aka the evil empire or "bad guys") purchase brand new UCC lists with fresh merchants on them and aggressively call them and entice them to stack. 4) Rinse and repeat.

So a lot of good merchants end up going bad and the "good guys" are left holding the bag. The bottom end will not trickle out until only good merchants are left because the good merchants will end up stacking as well. Let's face it, a merchant who is willing to pay the high factors in our industry is already on the ledge financially. It doesn't take much prodding to convince them to take additional funds. The way I see it, pretty soon about 50-60% of ALL merchants will have stacks in place. The only defense a "good guy" funder has against this poaching is to not file a UCC or use various UCC aliases. Maybe we'll start to see more prominent anti-stacking clauses in funding contracts with associated penalties (although they're not legally enforceable). "Good guy" funders just have to do a better job of educating their customers about the perils of stacking.

As long as stacking companies continue to make obscene amounts of money (and believe me, they are much more profitable than the "good guy" funders) and in the absence of any real regulation in the MCA space, then the "evil empire" will most likely prevail.