[pcfunder]

oohh

MCN was saying that a lot of these merchants who lowered payments didn't have to they just did it because the funding company was offering lowered payments to all merchants. Or they lowered in April because they had to but their business went back to normal and they decided to stay on lowered payments because they were able to get away with it.

I was saying that these merchants are asking to take on more cash advance debt by seeking a 2nd or 3rd position when it appears they aren't taking their current cash advance debt serious by getting back on normal payments when their business can handle it.

In retrospect, I can understand why some merchants would want to stay on lowered payments as long as the funding company doesn't declare a default but coming from someone who has been working with direct funders for a few years now, funding companies deal with a lotttttttttttttttttttttttttttttttttttttttttttttttt ttttttttttttttttttttttttttttttttttttttttttttt of lies and games that both brokers and merchants play. After dealing with thousands of deals and plenty of defaults, its pretty clear as day that merchants will say anything to get a deal funded and brokers will do anything to get a deal funded. Take all of the "normal" risk that goes into a cash advance and add on top a merchant who lowered payments from a cash advance for 9 months even though their business is back to normal and they are seeking more money, its pretty clear that no one in their right mind should want anything to do with this deal. Save these type of deals for the funders who are desperate. You also have to take into consideration that the merchants cash flow is increased due to the payments being lowered, yet they are still seeking expensive capital.

[Winning]

oohh

I was saying that these merchants are asking to take on more cash advance debt by seeking a 2nd or 3rd position when it appears they aren't taking their current cash advance debt serious by getting back on normal payments when their business can handle it.

So do you really feel as if the merchants owe a debt to the Cash Advance company that took a gamble by purchasing a percentage of the future receivables based off of past performance? Shouldn't the golden rule of the MCA Companies be "Past performance is no guarantee of future results"?

...After dealing with thousands of deals and plenty of defaults...

What seems to be a little concerning is that after being in the industry as long as you have been, and doing thousands of deals, you still in your heart think of the MCA as a loan, and that the merchant is in debt to the MCA company.. So if you feel that way in your heart, when a default occurs, your actions will be governed by how you truly feel about deal. And I guess that is where MCN is coming from when he stated "The problem is too many "funders" act like "Lenders".

If I told you I went to a casino and placed a bet for 100K on Floyd Mayweather winning a future boxing match, in which he loses, and I come to you and tell you I feel as if the casino still owes me money, you would think that I clearly must have misunderstood the fundamental concept of gambling. But then I tell you that I have been gambling for years, you would be somewhat puzzled.

[pcfunder]

So do you really feel as if the merchants owe a debt to the Cash Advance company that took a gamble by purchasing a percentage of the future receivables based off of past performance? Shouldn't the golden rule of the MCA Companies be "Past performance is no guarantee of future results"?



What seems to be a little concerning is that after being in the industry as long as you have been, and doing thousands of deals, you still in your heart think of the MCA as a loan, and that the merchant is in debt to the MCA company.. So if you feel that way in your heart, when a default occurs, your actions will be governed by how you truly feel about deal. And I guess that is where MCN is coming from when he stated "The problem is too many "funders" act like "Lenders".

If I told you I went to a casino and placed a bet for 100K on Floyd Mayweather winning a future boxing match, in which he loses, and I come to you and tell you I feel as if the casino still owes me money, you would think that I clearly must have misunderstood the fundamental concept of gambling. But then I tell you that I have been gambling for years, you would be somewhat puzzled.

isn't your entire point invalid since these merchants revenue went back to normal... since we bought future receivables and their receivables are back to normal, doesn't that mean they should be paying back to normal as well?

Also maybe this is new to you but funding companies are not in the business of charity? We fund off of future receivables because it enables us to provide businesses money without usury laws but you do know that we still expect our money back right? We don't really look at these cash advances as a casino gamble lol.

So lets say we take your points into consideration and were all just gamblers hoping for the best. Why would we gamble on a company who lowered payments on his first position? Am I supposed to fund them just because the merchant doesn't "owe" a "debt" to the first position and its mean of me to deny them more money?

If you don't understand these concepts, it might be time to close your business and brush the dust off your resume.

[Winning]

isn't your entire point invalid since these merchants revenue went back to normal... since we bought future receivables and their receivables are back to normal, doesn't that mean they should be paying back to normal as well?

I was not discussing the amount of the future revenue. I understand if there are future receivable, yes the MCA is owed a percentage of those receivables, what ever that amount is. If there are $0 in future receivables, the MCA is owed $0. My point I was speaking to was on the fundamental mindset, understanding, and expectation of what the MCA & Merchant is agreeing too and gambling with and that there is no debt, just a future revenue sharing contract.

Also maybe this is new to you but funding companies are not in the business of charity?

Do you feel if a gambler is in the business of charity? Some professional gamblers make millions of dollars, some gamblers loose a lot more than they win. But at the end of the day the core of who they are is the same. So some funding companies that loose more than they win could be looked at like a charity yes, and the ones that win more than they loose would not be looked at as a charity. So that is a subjective question.

We fund off of future receivables because it enables us to provide businesses money without usury laws but you do know that we still expect our money back regardless of "future receivables" right?

Correct me if I am wrong, but I thought MCA's fund off of historical receivables? They use the historical revenue data, as well as other data points, to establish risk and set dollar amount that they are willing to fund (gamble with)? Once funded (bets placed), the fight starts, every ACH repayment draft is similar to a boxer winning rounds. But just as in boxing, you never know when a knockout may come and completely turn the tables.. Hopefully the MCA won enough rounds to maybe break even, maybe not.. That is the nature of gambling.

So are you saying that MCA's are using cash advances to really lend money with a contracted guaranteed return as if they were giving out loans like a bank? Wouldn't that be fraud?

[MCN]

oohh

MCN was saying that a lot of these merchants who lowered payments didn't have to they just did it because the funding company was offering lowered payments to all merchants. Or they lowered in April because they had to but their business went back to normal and they decided to stay on lowered payments because they were able to get away with it.

I was saying that these merchants are asking to take on more cash advance debt by seeking a 2nd or 3rd position when it appears they aren't taking their current cash advance debt serious by getting back on normal payments when their business can handle it.

In retrospect, I can understand why some merchants would want to stay on lowered payments as long as the funding company doesn't declare a default but coming from someone who has been working with direct funders for a few years now, funding companies deal with a lotttttttttttttttttttttttttttttttttttttttttttttttt ttttttttttttttttttttttttttttttttttttttttttttt of lies and games that both brokers and merchants play. After dealing with thousands of deals and plenty of defaults, its pretty clear as day that merchants will say anything to get a deal funded and brokers will do anything to get a deal funded. Take all of the "normal" risk that goes into a cash advance and add on top a merchant who lowered payments from a cash advance for 9 months even though their business is back to normal and they are seeking more money, its pretty clear that no one in their right mind should want anything to do with this deal. Save these type of deals for the funders who are desperate. You also have to take into consideration that the merchants cash flow is increased due to the payments being lowered, yet they are still seeking expensive capital.

I think your juding these people really harashly. Look when COVID was in full swing in April i called my CRM company and asked them to lower by rate per user. They said sure we'll do it for a few months until things pick up again. Now its 8 months later, business is back to normal for me, but im still paying the lower amount. Am i doing the wrong thing by not calling them back and saying raise it back? I knows its supposed to be higher. Everyone would do exactly what these merchants did when they wered offered to have payments lowered. Its a bit ridiculous to call that a default.

[pcfunder]

Winning this is a lot to respond to I honestly recommend you call someone to help you

MCN your right but there is too much uncertainty. I can't imagine that any MCA company would keep someone on lowered payments for 9 months straight, that's basically the term of an MCA. I know that they would, but only to merchants who need help and those merchants should not be seeking more positions.

Maybe I'm wrong but this scenario screams D/F funder high risk to me. Let me know if anyone has funded a merchant whos been on lowered payments for 9 months with someone else due to covid. Has it worked out for you?

[Winning]

Winning this is a lot to respond to I honestly recommend you call someone to help you

MCN your right but there is too much uncertainty. I can't imagine that any MCA company would keep someone on lowered payments for 9 months straight, that's basically the term of an MCA. I know that they would, but only to merchants who need help and those merchants should not be seeking more positions.

Maybe I'm wrong but this scenario screams D/F funder high risk to me. Let me know if anyone has funded a merchant whos been on lowered payments for 9 months with someone else due to covid. Has it worked out for you?

I'm good, I am not currently seeking additional MCA's or a second position.. It's just that the debt comment you made intrigued me and made me want to understand on a deeper level why you would refer to it as a debt. When I thought I understood that MCA's are not debt but more along the lines of a well placed bet.

[pcfunder]

I'm good, I am not currently seeking additional MCA's or a second position.. It's just that the debt comment you made intrigued me and made me want to understand on a deeper level why you would refer to it as a debt. When I thought I understood that MCA's are not debt but more along the lines of a well placed bet.

I mean yes but that's such a basic concept that I never imagined it would be questioned lol. After understanding that basic concept, you can start to think a little bit past those concepts. No one is saying that MCA's are debt or that they aren't funding companies buying future receivables but its ok to look at someone giving someone 50k for 70k worth of receivables as a form of "debt" and analyze how they managed that "debt" so you could come to a conclusion on how they will handle your own payments.

[Winning]

I mean yes but that's such a basic concept that I never imagined it would be questioned lol. After understanding that basic concept, you can start to think a little bit past those concepts. No one is saying that MCA's are debt or that they aren't funding companies buying future receivables but its ok to look at someone giving someone 50k for 70k worth of receivables as a form of "debt" and analyze how they managed that "debt" so you could come to a conclusion on how they will handle your own payments.

A basic concept to you because you operate in this space... But not a basic concept to a merchant or judges that are against MCA's. I am on the outside looking in, and I would say please be more careful when using the term debt as it relates to a merchant repaying a Cash Advance. Unless the merchant has did some sort of fraudulent activity and attempting to not pay the percentage of the received revenue, there is technically no debt.

[pcfunder]

A basic concept to you because you operate in this space... But not a basic concept to a merchant or judges that are against MCA's. I am on the outside looking in, and I would say please be more careful when using the term debt as it relates to a merchant repaying a Cash Advance. Unless the merchant has did some sort of fraudulent activity and attempting to not pay the percentage of the received revenue, there is technically no debt.

debt

[RickyR3712]

A basic concept to you because you operate in this space... But not a basic concept to a merchant or judges that are against MCA's. I am on the outside looking in, and I would say please be more careful when using the term debt as it relates to a merchant repaying a Cash Advance. Unless the merchant has did some sort of fraudulent activity and attempting to not pay the percentage of the received revenue, there is technically no debt.

When you took multiple positions

[MCN]

Winning this is a lot to respond to I honestly recommend you call someone to help you

MCN your right but there is too much uncertainty. I can't imagine that any MCA company would keep someone on lowered payments for 9 months straight, that's basically the term of an MCA. I know that they would, but only to merchants who need help and those merchants should not be seeking more positions.

Maybe I'm wrong but this scenario screams D/F funder high risk to me. Let me know if anyone has funded a merchant whos been on lowered payments for 9 months with someone else due to covid. Has it worked out for you?

You may be right in certain cases where they try to call the merchant to have them raise the amount and they refuse. But youd be surpised how often they dont bother doing that. Especially when your dealing with the bigger companies in the space.