B2B Payments

LSQ Secures $40M For Invoice Financing

Small businesses have always struggled to secure sufficient working capital to survive, and that struggle has led to the explosion and diversification of the alternative lending industry. One breed of alternative lenders that has gained traction in recent years is receivables financing, which sees a lender provide working capital to provide suppliers with funds while they await payment for their orders.

LSQ, a veteran in this industry, has attracted new funding that demonstrates investors’ support of the market. In an announcement made Monday (July 6), reports revealed that LSQ secured $40 million in funding from Ares Capital Corporation.

“We will use this capital to accelerate our plans, reinventing access to working capital financing for micro, and small and midsized businesses alike,” said LSQ Funding CEO and founder Max Eliscu.

“Ares Capital is a well-respected provider of flexible capital, with a proven record of supporting the financing needs of privately-held companies across many different industries,” said the company’s Chief Financial Officer Terry Ragsdale. “This capital, in combination with the investment from Lovell Minnick Partners, positions us to further expand our reach in the market.”

Reports said that LSQ has strengthened its operations through technology, credit intellectual property and by striking partnerships with traditional banks. The firm saw 85 percent growth in 2014 thanks to these strategies, it said.

Since its founding, LSQ has facilitated more than $10 billion in invoice financing. The $40 million follows more than $100 million invested in the company earlier this year, led by Lovell Minnick Partners LLC.

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The pressure on banks to modernize their payments capabilities to support initiatives such as ISO 20022 and instant/real time payments has been exacerbated by the emergence of COVID-19 and the compelling need to quickly scale operations due to the rapid growth of contactless payments, and subsequent increase in digitization. Given this new normal, the need for agility and optimization across the payments processing value chain is imperative.

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