We live in challenging but exciting times. As any participant in the MCA world can attest, more money is flowing into funding deals, more ISOs are entering the fray, and consolidation is occurring. Institutional estimates of the volume of the $180B small business loan market moving to MCA or other bank alternatives range from $15-50B. As large as the MCA market now seems, it is only going to get larger and more competitive.
What does it take to win?
It used to be that anyone could open up as a funder, throw money against the wall, and have it stick. If you were a good sales team, you could open an ISO and the money would roll in. Times are a'changing. The price of entry for funders now includes a low cost of capital, robust risk management systems, plus enough staff and automation to guarantee speed of delivery, responsiveness, transparency, and visibility to ISOs - and there's also the "I" word: Integrity. As an ISO, you are challenged by funders going direct, tougher compliance standards, the rising cost of customer acquisition as competing ad spends drive up prices, and the slow grind of communicating and managing funders. Through all this, you had to ensure that your hard won merchant leads stayed yours. At Pearl Capital, we have always been the home of that really tough deal that you couldn't get funded anywhere else. We have devoted talented ISO relationship managers and the best underwriting team in the business. But we have to confess that we lost ground in 2013 and 2014 when other funders started taking on those tough files. We stopped listening to you and were no longer the most competitive bid, the fastest turn around, and the most transparent process. When you thought of Pearl, you thought of a third look funder and that car you used to own in 2012 before you traded up. Well 2014 is over and we are determined to take our market back. Pearl is now owned by a leading private equity group Capital Z Partners (www.capitalz.com) whose sole focus is financial services and that has successfully invested close to $3B in businesses over the past 25 years. We will continue to fund those tough files and compete hard for the entire credit-challenged merchant market. The new Pearl is returning to its roots, focusing on collaboration and building opportunities by strengthening partnerships.
You have seen some significant changes at Pearl, including:
- • Real time syndication reporting
- • File status updating in portal through salesforce
- • Edocs and electronic signatures
- • Variable offer pricing engine (no more resubmits for different factor/term)
- • Competitive commissions
- • White label
Our pledge to you is to never forget that you are our most important relationship, that we succeed when you succeed, and that we need to compete for your business - every day.
Welcome to the new Pearl.