Utah-based FinWise Bank, a subsidiary of All West Bancorp, is partnering with alternative small business lender Behalf. Together the companies hope to provide a broader range of financing solutions to a greater number of SME clients. “We founded Behalf in advocacy of small businesses and solving their working capital needs with innovative technology solutions is our central focus,” company co-founder and CEO Benjy Feinberg said. “Partnering with FinWise allows us to expand our product offering and serve more customers with financial tools that help them grow,” he added.
Behalf enables its merchant partners to offer business clients instant credit and flexible payment terms at the point of sale. In fact, term flexibility is the key area of focus for Behalf, especially because it is a key pain point for many small businesses. By paying vendors directly “on behalf” of small businesses – as well as managing repayment and collections – Behalf gives small businesses the ability to match financing terms with the needs and timetable of their business, not the other way around. “Now she has the time to grow her business, and the credit to grow her business because she now has the terms that she needs,” Feinberg said, explaining how the platform worked for small business owners during his company’s FinovateFall demo. At the same time, he added, vendors enjoy working with Behalf because they get paid on day one as opposed to day 29 or day 89.
Behalf produces credit decisions in real-time. Business clients provide personal and business addresses, as well as a social security number, and Behalf tells them what size credit line the business qualifies for. Businesses can use the line of credit for both online and offline purchases, and the size of the client’s available line of credit increases each time the client pays off Behalf. Rather than negotiating terms with multiple vendors, Behalf Director of Product Andrew Abshere explained, the Behalf client now has flexible terms with a single payee. “She can take these terms with her anywhere, to any vendor,” Abshere said. He then showed how clients set up vendor payments directly through the Behalf platform, adjust the length and frequency of repayment, and add bank details to enable automatic repayment. Once the bank information is authorized, Behalf contacts the client’s vendors by e-mail, notifying them that Behalf will be paying “on behalf” of the client. The process takes less than five minutes.
David Tillis, VP of Specialty Lending at FinWise Bank praised Behalf’s “talented people, technology, and acquisition channel” which he said would “change the landscape of business lending.” A self-described, “financial tech bank with a community heart,” FinWise Bank was founded in 2000 and is headquartered in Sandy, Utah. Also known as Utah Community Bank, FinWise Bank has teamed up with fintechs in the lending space before, most recently partnering with direct loan provider, LendingPoint, in March
Founded in 2011 and headquartered in New York City, Behalf demonstrated its vendor platform at FinovateFall 2014. A member of CB Insights’ Fintech 250, Behalf has raised $156 million in funding, including a $27 million Series C a year ago this month. MissionOG, Spark Capital, and Viola Growth are among the company’s investors.
We spoke with Debbie Peace during the networking session at FinovateSpring 2017 in San Jose, and followed up with a few questions by email. Below are her responses.
