The best time to invest, runs an adage, is when there is blood in the streets. Similarly, could it be the case that the best time to launch a new firm is when the old guard is retreating?
Perhaps. As has been covered in this space before, many of the big names in the alternative finance space have been beset by turmoil, with an eye on shifting investor views — namely that those investors are increasingly of the mindset that their capital may be better deployed elsewhere. In addition, regulators have been delving into interest rates charged on loans on a state-by-state basis.
Against this backdrop enters Plousio, which made its debut in the alternative lending space just last week. The firm seeks to connect lenders to borrowers, with an emphasis on streamlined processes via online applications.
In an interview with PYMNTS, Francis Pierre, who oversees strategic partnerships at Plousio, stated that the loans, which have a range of $1,000 up to $1 million, find a “sweet spot in the range of $15,000 to $25,000,” with SMBs “looking to get a loan in order to make payroll or buy equipment.” Even this early into the launch, the verticals most actively seeking loans are retail storefronts and restaurants, where, previously, capital needs may have been covered by, say, personal or corporate credit cards.
One key need for SMBs as they navigate the lending process, said Pierre, is to make the terms and conditions of the loans themselves as transparent as possible and to make sure that the broker or lender offering the loan is offering the product best suited to that SMB’s individual needs. Often, said Pierre, business owners are “inundated with offers and with brokers pitching loans, once a sales lead is generated,” and that can be both confusing and time-consuming. For businesses with as little as six months to a year of operating history, seeking to scale, time is precious, and yet, business owners, “once they put their info in one place, are bombarded with 20 calls the next day.”
To that end, connecting with roughly 70 business lenders, said Pierre, the firm has deployed an algorithm (known as MatchMe) through which applicants and lenders are matched according to need (Plousio does not make loans itself, though it may, at some point in the future, said Pierre, enter that line of business).
As for the online lending environment itself, said Pierre, there is no doubt that more regulation is in the offing, and that is not necessarily a bad thing. There continues to be concern over identity theft and data security, said the executive, and some parameters to this largely unregulated industry can help mollify those concerns.