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  1. #1
    Senior Member Reputation points: 8384
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    Growth in the MCA industry

    does anyone have any projections of growth expectations for MCA industry?
    will we all be fighting more and more of a small pool of businesses or can we expect the industry to grow exponentially ?
    am i naive in my belief that 70% of business still have no clue that there is such a thing of a merchant cash advance ?

  2. #2
    Shield,

    I know this forum has a hard time believing people as most are just pure hype. I can tell you I see 6000+ Small Biz Owners coming thru our platform a month and over 70% of them need funding ASAP. With our new partnership with Experian we believe we could double that volume.

    As long as traditional banks continue to keep biz owners from getting loans MCA/ACH loans are going to be the preference for many individuals. Just my humble opinion

  3. #3
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    where do you get the 70% from shield? I would have to agree with the number regardless as it pertains to split-funding. there are a shocking number of merchants that haven't heard such financing is possible, let alone exists.

  4. #4
    lendio- are you seeing more and more non traditional sics applying for financing? when i say non traditional to mca's, i mean non restaurant, auto repair, beauty salon, etc businesses? are most seeking an amount, rate, term that simply does not exist within our space? a more detailed snapshot of that 70% of 6000 smbs per month would be interesting that need financing. the mca and daily ach loan product may not meet the needs of that 4200 asap need you mention if they are looking for a totally different loan product that was is offered.

  5. #5
    Ok let me clarify regarding the 70%. With our profile we have 4 steps for the small business to be matched up with you, the lender. The four steps are designed to get to know the business owner better and one of the questions is a pretty standard question. "When do you need financing" We are finding that we have on average 70% of the small business owners marking, "Need Funds Immediately/ASAP."

    As far as the mix of them. I have noticed that most businesses have never heard of MCA that I talk to personally (I don't have a %). Where our MCA lenders have been very successful is that we have a very high # of small businesses that have good credit card receipts, good revs, been in biz longer then 3 months, but have poor credit. They have a need for funding, and in most cases the need is strong. If they haven't heard of MCA, but have a need for funds with bad credit they really have no options. Chase says NO, Wells says NO. Their CU declines them, and so they see us as a life-line. As long as you guys take care of them with some care then they will jump hook, line, and sinker.

  6. #6
    as long as they take cc sales for mcas, sounds like you have some prospects. however, if they take $5K per month in cc sales and need $50K and thats the maj of requests, mcas wont be a solution. the filtering has to also match cc sales per mo to funding request to see if its legit to pay for lead. nobody realy advances more than 100-125% of monthly cc sales averages and most companies have become even more conservative than that-

  7. #7
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    I guess. Part of the sales process is setting a merchant's expectation. A lot of merchants processing 5k state they are looking for 50k because they have no idea what they can get so they decide to start as high as possible. Even the merchants that shut you down cold on the first phone call that say "8k? what could I possibly do with only 8k?!" shop around for a couple weeks, get told the same thing over and over and over, and eventually take an 8k deal with someone. If you tossed the lead and huffed and puffed that the merchant was unrealistic and the lead you bought was too crappy, then you are wasting your own money. If you are expecting merchants to always be closed on the reality that they will only get 8k when processing 5k, then the lead source might as well sign the merchant themselves. Some sales people act like underwriters and think they are just there to process paperwork rather than put in the time and effort to engage merchants or be conscientious of their preconceived notions. They have hundreds of options these days and it can take weeks or longer before they decide the route they choose. Anyone expecting all their deals to be layups are dreaming.

    Are your sales reps following up on leads that got marked as 'not interested' a month ago? Are you e-mail blasting every merchant you have come into contact with weekly or monthly? If you're not, you are throwing money out the window. Lead sources sell exactly what they say "a lead." not "closed deals."

    If anyone thinks a merchant processing 5k, in business a year, 600+ credit,and needs funding asap is not a great lead just because they said they're looking for 50k is crazy. No wonder so many people complain about leads and resort back to UCCs.

  8. #8
    Veteran Reputation points: 134971 Chambo's Avatar
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    Hopefully Mr Bash can give us some feedback form the drunken debauchery at ETA?

  9. #9
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    I heard he was spending all his time collecting beads on Bourbon Street.

  10. #10
    the demand is still high and the show had a good turnout.



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