P2Binvestor Teams Up with Amalgamated Bank to Help SMEs Get Funded

New partnership. More deals. Bigger financing opportunities for small businesses.

That’s the plan for online SME lender P2Binvestor (P2Bi) and Amalgamated Bank, a socially responsible bank headquartered in New York. By working together, P2Bi and Amalgamated Bank will be able to provide more financing with less risk to early-stage SMEs that have traditionally struggled to secure credit.

“Our partnership with Amalgamated Bank signifies another important step in further validating our Bank Partnership Program,” CEO and co-founder of P2Bi Krista Morgan said. “Our technology, combined with Amalgamated’s record of success, allows us to provide affordable, scalable financing options to up and coming brands across the country. In addition, we’re proud to partner with a socially responsible company that shares similar values not only with us, but with many of our clients.”

Working with P2Bi will enable the $4+ billion bank to expand its loan portfolio and fund more emerging, socially responsible commercial and industrial businesses. P2Bi benefits from access to those businesses currently doing business with the bank. For SMEs, P2Bi’s lower rates on its lines of credit provide affordable, flexible financing on a platform that is easy to use.

“Amalgamated is dedicated to developing innovative and tailored banking and financing solutions for mission-driven organizations and companies who are working to make a positive impact in our society,” President and CEO of Amalgamated Bank, Keith Mestrich said. “By partnering with P2Bi, Amalgamated is able to help these businesses access capital they might not have otherwise had access to – and in turn grow their business and their impact.”

The new relationship with Amalgamated is a function of P2Bi’s partnership program, launched last year. The program enables banks to finance SMEs, taking a 50%, senior secured position, with P2Bi’s investors providing the other half of the funding. Interest rates range from 8% to 12% on asset-backed lines of credit from $500,000 to $10 million.

P2Bi demonstrated its P2B crowdlending platform at FinovateFall 2014. Last month, the company raised more than $17 million in combined debt and equity funding, taking P2Bi’s combined overall funding to $33.76 million. Earlier this year, American Banker took a look at how another FI, New Resource Bank, was leveraging its partnership with P2Binvestor to reach SME clients in San Francisco. P2Binvestor was founded in 2012 and is headquartered in Denver, Colorado.

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P2Binvestor Earns $17+ Million in Funding

Peer-to-peer crowdlending platform P2Binvestor (P2Bi) received more than $17 million in combined debt and equity funding this week. The debt investment come from more than 20 participants, all sourced from the P2Bi marketplace that consists of banks, private investors, and institutional investors. The equity funds come from Angel investors.

The Colorado-based startup has not disclosed the breakdown of debt vs. equity but we estimate around $13.4 million of the total is debt and about $3.6 million is equity. This is based on P2Bi’s report that today’s investment is its fourth round of equity funding, bringing its total equity raised to $13 million. While the company did not comment on its total funding, Crunchbase estimates P2Bi’s combined debt and equity at $33.76 million.

P2Bi will use the funds to power its new bank partnership program. Launched last year, the bank partnership program offers access to working capital to small-to-medium businesses (SMBs) who don’t qualify for traditional financing. It not only allows banks to invest in local businesses, but also helps them tap into a new asset class. Under the partnership, banks will front 50% of the capital with a senior secured position. P2Bi’s base of private investors will provide the remaining half of the capital and businesses will receive the funds with a blended interest rate of 8% to 12%. New Resource Bank, which began piloting the bank partnership program last October, has already closed seven loans worth over $16 million.

“Over the course of the past few months, P2Bi has focused on building a new partnership model with community banks that is proving to be very successful,” said Krista Morgan, CEO and cofounder of P2Binvestor. “Growing businesses love the idea that we can graduate them to cheaper financing without the hassle of switching, and banks love that they can be the first lender to a growing business building a valuable, long-term relationship. This raise enables us to onboard new banks into the program.”

Founded in 2012, P2Bi debuted at FinovateSpring 2013 and showcased its borrower application and loan management platform at FinovateFall 2014. Earlier this spring, MonJa featured Morgan in an interview and last fall the company made Credit Donkey’s list of Best Finance Technology.

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This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

P2Binvestor Launches Bank Partnership Program

Peer-to-business crowdlending platform P2Binvestor (P2Bi) has launched a bank partnership program today. The new initiative will offer small-to-medium businesses (SMBs) working capital while providing banks access to a diversified asset class.

Under the partnership, banks will front 50% of the capital with a senior secured position. P2Bi’s base of private investors will provide the remaining half of the capital and businesses will receive the funds with a blended interest rate of 8% to 12%. By partnering with P2Bi, banks can quickly extend multi-million dollar lines of credit to growing SMBs and establish a lending relationship with them at an early stage in their business development.

The Colorado-based company’s CEO Krista Morgan explained that regulatory and technology hurdles have made it difficult for business borrowers and banks to connect. “Until now, there hasn’t been a solution like this, which unfortunately has forced growing companies to take on expensive and time consuming funding,” Morgan said. “We’re enabling banks to lend to businesses they otherwise wouldn’t be able to due to strict lending standards,” she added.

Piloting the bank partnership program is New Resource Bank, a San Francisco-based bank with $331 million in assets under management and a focus on social, environmental, and economic change. “P2Binvestor is excited to be powering New Resource Bank’s line of credit with both our marketplace and proprietary receivables lending platform,” said Morgan.

Vincent Siciliano, president and CEO of New Resource Bank describes the program as a “win-win” for the bank and for businesses. Siciliano said, “By using P2Bi’s platform, growing businesses will be able to secure capital that they typically wouldn’t be able to access through bank lending alone. This allows us to offer a greater suite of lending products to the community of sustainable businesses we serve.”

Founded in 2012, P2Bi debuted at FinovateSpring 2013 and, at FinovateFall 2014, the company showcased its borrower application and loan management platform. In November of 2016, P2Bi closed a $7 million Series A round, bringing its total equity funding to $9.6 million. Last month, Forbes featured the company in an article titled, “When Venture Capitalists Said, ‘No,’ This Woman Didn’t Give Up.”

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P2Binvestor Scoops Up More Than $7 Million in New Funding

p2binvestor_homepage_november2016

Small business marketplace lender P2Binvestor announced $7.7 million in new funding, courtesy of a Series A round led by Rockies Venture Club (RVC). Also participating in the Series A was Japanese venture capital firm, Future Venture Capital Co. (FVC). The investment in P2Binvestor was FVC’s first direct investment outside Japan.

P2Binvestor founder and CEO Krista Morgan said that her company was filling a significant niche for SMEs seeking financing to grow. “We’re seeing more interest in our model as venture funding hits a two-year low and more entrepreneurs are looking for ways to grow their business—while preserving their equity—by using good-quality, flexible debt,” Morgan said. She added that the new capital will be invested in technology as well as sales and marketing “as we scale to meet market demand.”

p2binvestor_stage_ff2014

P2Binvestor founder and CEO Krista Morgan demoed her company’s technology at FinovateFall 2014.

Headquartered in Denver, Colorado, and founded in 2012, P2Binvestor demonstrated its new borrower app and loan-management dashboard at FinovateFall 2014. The company specializes in providing asset-backed lines of credit, using the crowdlending format to connect both accredited and institutional investors with small businesses needing funding, and using the latest in technology to streamline the underwriting process and provide due diligence for investors. In September, P2Binvestor won the finance and banking PowerBook award from the Denver Business Journal, and extended a $10 million credit facility with Urban Settlement Solutions.

P2Binvestor has funded more than $350 million in revolving credit to more than 80 SME borrowers since the spring of 2014. The company hopes its crowd of 150 accredited retail and institutional investors will help P2Binvestor fund an additional 112 new borrowers by March 2017. P2Binvestor anticipates more than $8 million in revenue this year and expects to be cash-flow positive in 2017. The company’s average line of credit is $1 million.

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This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.