Recently we have been getting a lot of calls from MCA teams talking about the MCA business in general. Many funders are telling us there is a major increase in the amount of stacked and defaulted merchants. This is because of the increase in new ISOs–about 5 per day in the NY area alone. As a result, more merchants are being called, funded, stacked, and later forced to default.
Due to the changes the industry is facing, we at Loyola Media Group have put together this outline of how best to approach the changing industry dynamics.
1. Use business lists where companies are in business for 6 months and have not already received an advance and are not yet stacked.
You may do this by prospecting Angie’s List, Manta, Yelp, and Zoom Info. The downside to this is you may have to educate the merchant but once you do you will have cleaner files.
2. Work with trusted live transfers.
When we generate transfers, we segment and disqualify merchants below $20k, with more than 2 positions, and or no remaining equity for funding. By doing this you may not find the perfect deal, but it will be cleaner than calling UCC that the entire industry is calling.
3. Work with an association.
Become the official funder to the restaurant industry, funeral parlors, or printers, etc. Associations generally require a fee to join and that may be costly, but you may end up meeting a lot of merchants who have never had a merchant cash advance.
4. Partner with industry professionals.
Your local credit union, sbas, regional banks. Get relationships with loan officers who may not be able to help their customers but want to see them succeed. Accountants, attorneys, and financial advisors are all great contacts.
5. Don’t just be an MCA broker.
You will limit yourself to only those types of deals. In your rolodex, have a hard money lender, a collateral lender, a commercial mortgage lender, a factoring company, and any other options that can help you get cleaner easier deals funded.
Our goal at Loyola Media Group is to see all our MCA brokers succeed. Your success is our success. Check out what we have to offer for your MCA business today.
Image by Free-Photos from Pixabay
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