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It’s January again, and there’s nothing quite like the promise of 12 blank calendar months ahead to re-motivate, rejuvenate, and re-define what you want to accomplish in 2014. While you may or may not believe in the resolution hype that comes with the arrival of a new year, I for one find the optimism of people wanting to better themselves rather inspiring. In the business world, companies take this time to reflect on the previous year’s progress, while setting the bar even higher for the new one. For many, plans to grow and expand are at the top of the list, which inevitably means that obtaining working capital to do so is right below it.
If I were a betting woman (alright maybe I am a betting woman), I’d bet that no company’s goal for this year is to be denied a loan by the banks. It’s happening more and more though, as banks’ underwriting obstacles become harder to overcome. The good news is that banks aren’t the only option anymore. In fact, they aren’t even the best option anymore. 2013 was a huge year for the alternative finance space as more new and innovative ways for companies to get funding came out of the woodwork. Terms like crowdfunding and alternative lending became more mainstream due in part to the new regulations passed from the JOBS act, as well as some major success by web-based platforms like Kickstarter and Lending Club. Each of these new companies is solving a niche problem that businesses face in their financing needs. And that’s what we’re doing too, based right here in the Mile High. But to better explain our model, first let me dim the lights and set the stage…
Imagine a small B2B company that has high growth potential, but all of their working capital is tied up in their receivables. This is because the larger retailers they sell to (think Home Depot, Costco, Whole Foods, Target, Walgreens, etc.) can take up to 120 days to pay their invoices. That small business, like most, generally can’t afford to wait up to four months to see that money come in—they need working cash right away to fulfill multiple orders and make payroll. They’ve only been in business for a year, so banks aren’t going to lend to them even if they show high growth potential. What do they do now? What are the options?
After doing some research, you learn that there are many funding solutions and alternatives to a bank loan but it’s hard to find one that meets your exact needs. That is, until you find us, P2Binvestor. P2Binvestor is the first and only crowdfunding platform for receivables-backed lines of credit. We provide small businesses with necessary and immediate working capital by crowdfunding their invoices through investments by accredited investors. In simpler terms, portions of business’ invoices are purchased by investors on our website. The business gets the money they need right away without giving up equity in the business or incurring debt. Our investors are paid back as the invoices get paid and earn a monthly return in the meantime. They also get the satisfaction of supporting small businesses, fueling the economy, and creating jobs.
For businesses, P2Binvestor takes over management of invoice collections, which frees up more time for the business to focus on growing (it also reduces headaches—who loves chasing invoice payments?). And because this is crowdfunding, businesses that use our platform are also building important relationships with our crowd of accredited and institutional investors. Real people invest in companies they believe in and receive monthly updates on each company's progress.
Our model is disrupting the $136 billion receivables finance industry because we leverage technology and a crowdfunding model to lower operational costs and our cost of capital. This means we can provide businesses with a lower interest rate than traditional receivables companies as well as have more flexibility in the loans we make. P2Binvestor and our investor crowd are ready to fund your business now, and we want to say 'yes' when the banks cannot or will not!
And while we can be flexible in the types of businesses we fund on our platform, here are some general criteria that describe the typical business we prefer to fund. The business should be B2B and have:
- Operating history of at least one year
- Invoices with payment terms of 30 or more days
- Annual sales of at least $1,000,000
For companies that don’t quite meet these requirements, but are on the right track, we also have a special program called "Crowdstart" to get newer, growing companies the funding they need.
Contact us to learn more about Crowdstart or our standard funding program, or get started right away by visiting P2Bi.com and completing the three-question form on our homepage to indicate how much funding you need.
Let's get funded!
