December 19, 2014 · Small Business Loans · (No comments)

Read MoreHow LendingClub aims to end banking as we know it

Consumers like peer-to-peer lending because they can consolidate higher interest rate credit card debt. Investors like it because there is a wide range of investments and returns; it could be anywhere from 7 to 30 percent, depending on the risk profile. LendingClub gets a fee on the loan origination, and it sells off the loan.

This is the first of a number of peer-to-peer lending companies likely to go public. A second lender, On Deck Capital, is scheduled to price next week. But it makes mostly small-business loans and usually holds them.

On the Nasdaq Wednesday night, Momo, a Chinese mobile-based social networking platform, is seeking to price 16 million shares at $12.50 to $14.50. Alibaba owns a 20 percent stake. The problem is these Chinese social media plays have been crushed recently. Weibo is at a new low since going public in April, and Cheetah Mobile is down 16 percent this month.

Theres more Thursday, but Im a bit surprised there havent been more deals. Maybe its because the markets are trading off their highs and investors are more cautious.

December 18, 2014 · Small Business Loans · (No comments)

>PRWEB.COM Newswire

San Diego, California (PRWEB) December 17, 2014

Previously, many borrowers who qualified for program terms which included a pre-payment discount had only received a 10% discount for paying off their working capital loans early.

Now, Liberty Capital Group is offering a higher discount of 25% on all outstanding interest/fees for loan prepayment for those who qualify for the program.

This offer will not only apply to new borrowers but, current clients will also have an opportunity to take advantage of this discount on future funding. says Ralph Carvalho, who heads the companys national renewal department.

Plus, the company is set to release a program that requires only a few clicks and no documentation to fund–instantly.

A business owners time is valuable. An automated application process and instant funding means more time to focus on the things that really matter such as running their business and family. We have now reached truly exciting milestone in financing. says Liberty Capital Group CEO Adrian Dalsey.

Read the full story at

December 18, 2014 · Fundings · (No comments)

Will: Yesterday, we posted a roundup of all the November venture deals in Chicago. It was a strong month with over $83 million in fundings, including $10 million for both Narrative Science and Shiftgig. Jim, hows December looking?Jim: Big. Yesterday, we profiled NowSecures $12.5 million Series A and today, biopharma startup Naurex announced that it has raised an $80 million Series C, led by Cowen Investments, EcoR1 Capital, Goudy Park Capital and a variety of previous backers. The financing will be used to fund the companys third and final round of clinical trials for its drug for patients with major depressive disorder. Naurex, born out of Northwestern in 2009, has raised $160 million to date.

December 18, 2014 · Small Business Loans · (No comments)

SBA’s fundamental lending mission is to help those creditworthy small business borrowers that otherwise would be unable to access credit on reasonable terms and conditions. And SBA lending policies are designed to provide those small business owners access to long-term credit that is designed to link public policy not with the end consumer, but to the needs of the small business owner based on the borrowers financial viability and qualification as a small business. Following stringent program guidelines, SBA lenders provide credit to small businesses to meet a wide variety of business needs – commercial real estate purchases, business acquisitions, machinery and equipment, working capital, and more. These are all important to entrepreneurs as they start and grow their businesses in communities around the country. 

These borrowers served by SBA programs are not failing businesses that are being subsidized, but are viable small businesses that are all across America.  But, in the wake of the Great Recession, many small businesses are still being denied access to reasonable credit because of continued regulatory and capital pressures facing banks today.  Because of this, SBA loans continue to fill a critical void for small businesses. 

As of today, the outstanding portfolio of SBA-related loans is nearly $110 billion, including $83 billion in loan guarantees. The impact of SBA lending programs within the small business economy is often underestimated by those who do not adequately analyze the sub-market to which SBA lending data is applicable. Although FDIC bank call report data looks at the population of small business loans at a certain threshold and indicates an overall volume of $586 billion as of September 30, 2014, only approximately 20 percent of those loans are long-term (that is, loans with maturities of three years or longer). Therefore, in order to estimate the impact of $110 billion in SBA-related lending, the comparison must be made only to that subset. When viewed in this light, it becomes clear that SBA loans are, by far, the single largest source of long-term small business loans in the US 

As for the burden on the government, these loans pay for themselves through fees collected from borrowers and lenders.  That means that SBA 7(a) loans cost the taxpayer zero.  Period. 

During the recession, millions of Americans lost their jobs, defaulted on their mortgages, and saw their lifetime savings disappear. Banks’ portfolios experienced significant losses. During that time, as credit markets tightened and few conventional loans were available, the SBA provided a support system to help small business owners and their employees to start or remain in business. And now, as credit markets are thawing and the economy is recovering, SBA lenders remain ready to provide support for a growing economy. SBA’s loan portfolio is healthy and its performance compares very favorably to conventional lending portfolios. 

As Washington winds down and people begin to disperse for the holidays, small businesses across the country are still in action. Thanks to the SBA and its local lending partners, small businesses are able to start and grow. Next year, we look forward to continuing to issue Main Street loans that support small businesses and their employees. 

Wilkinson is president and CEO of the National Association of Government Guaranteed Lenders.

December 18, 2014 · Financial Partners · Comments Off

Porter Bancorp Inc., parent company of PBI Bank, is finalizing a deal to settle up with the US Treasury over funds it received as part of the Troubled Asset Relief Program.

The Treasury bought $35 million of preferred stock in Porter Bancorp (NASDAQ: PBIB) in 2008 as part of its program to inject capital into the banking system during the peak of the financial crisis.

Porter Bancorp was among six local bank-holding companies that accepted TARP funds and is the last Louisville-based bank holding the funds.

The company struggled coming out of the recession and continues to operate under a consent order it agreed to with the Federal Deposit Insurance Corp. and the Kentucky Department of Financial Institutions. The order outlines an agreement to improve asset quality and reduce loan concentrations.

Porter Bancorp has been in compliance with the consent order for 10 quarters and has reduced the size of its loan portfolio, which is down significantly from $1.3 billion as of Dec. 31, 2010, to $638.4 million at the end of the third quarter this year, as Business First previously reported.

In a filing with the US Securities and Exchange Commission, Porter Bancorp said the Treasury accepted bids for five bidders designated by the company to buy the 35,000 series A preferred shares for $1,000 each.

The bidders include W. Glenn Hogan, Michael T. Levy and Patriot Financial Partners LP, for which W. Kirk Wycoff serves as a director. Hogan, Levy and Wycoff are members of Porter Bancorps board of directors.

A message left with Hogan, who is the chairman of the board of directors, was not immediately returned.

December 18, 2014 · Small Business Loans · Comments Off

Small business owners across Ohio are more confident about the economy and borrowing money at levels not seen since 2008, based on lending volumes provided by the US Small Business Administration’s area district director.

Last budget year, 1,799 government-guaranteed 7(a) loans for working capital and business acquisitions were approved in southern and central Ohio, said Martin Golden, director of the federal Small Business Administration’s Columbus, Ohio, district. The district covers 60 counties including a Cincinnati branch office. Those loans deployed a total $358 million worth of capital in the regional economy, fueling business expansions and new construction, Golden said.

More 7(a) loans, the federal agency’s largest small business loan program, were approved during the October 2013 through September 2014 period than every year since the Great Recession ended in 2009. However, volumes are not quite back to pre-recessionary spending. In 2008, small business owners in this Ohio district obtained 1,908 loan approvals, according to Golden.

“I think the banks have cleaned up their balance sheets and there’s a lot of liquidity in the market,” he said.

An additional 96 loans under the 504 program for commercial real estate were approved last year totaling $65 million. However, this loan program’s growth is flat compared to past years, Golden said.

Not only is higher small business lending a signal that business leaders are more certain about their prospects, it’s another signal in a growing pile of evidence that Ohio’s economy is doing better. It just has yet to fully recover. For example, statewide unemployment has fallen to a pre-recession low of 5.3 percent due somewhat to job growth, and some to a shrinking labor force, according to the most recent figures available from Ohio Department of Job and Family Services.

“The more confident (business owners) are, the more likely they are to fund expansion, and more importantly, hire workers,” Golden added.

Approximately half of Ohio’s workforce owns or works for a small business, said Golden, who considers small businesses those with 500 or less workers.

When the economy was down, Neftali Roblero and his business partners decided to strike while the iron was hot and open a used car dealership. Roblero, Gerardo Acosta and Miguel Garcia all own international supermarkets in Hamilton and Fairfield, and heard horror stories from their Spanish-speaking customers about their car-buying experiences.

Seeing the opportunity to open an auto dealership that could be promoted to their grocery customers, they opened Mi Tierra Auto Sales LLC at 3108 Dixie Hwy., Hamilton. They also heard from their customers a need for a Spanish-speaking car dealer to negotiate contracts in a language customers could understand and know what they’re signing up for.

The partners obtained an SBA-backed loan to buy the property and building through Access Business Development Finance Inc. The Certified Development Co., which is authorized to make small business loans by the US SBA, also helped the entrepreneurs fill out and file the necessary paperwork.

“We are in the fifth year of this business,” Roblero said. “We already have a relationship with most our customers. We tell them exactly what car they’re buying.”

Ohio business owners like Roblero don’t see the economy back peddling, but their six month outlook reflects more of the same for the local economy, based on the findings of a PNC survey of small- and medium-sized companies.

Business has been tough, Roblero said. “Competition has been a factor. The economy has been another factor,” because more people are able to afford to buy new cars again, he said.

The PNC Financial Services Group Inc. conducts the survey twice-a-year, and released the latest results in October.

Key findings include:

o Approximately 40 percent of Ohio business owners told PNC say they were impacted by last season’s harsh winter, and of those, 70 percent say they have not yet fully recovered.

o Fewer Ohio business owners surveyed this fall (39 percent) expect sales to grow the next six months than survey takers in the spring or those surveyed a year ago. But that’s also because more owners (48 percent) expect sales results to stay the same, and not because they’re projecting sales to decline.

o As a result, 11 percent of Ohio business leaders expect to do more hiring in coming months whereas hiring is forecast to pick-up by 20 percent nationally, based on PNC’s survey results.

Rather, more Ohio business owners (82 percent) plan to keep payrolls constant than they did a year ago. There are no plans to cut more workers.

Business owners have been cautious, waiting to see what will happen before they invest in more people or equipment, said Steve Foster, president of LCNB National Bank of Lebanon. But sales are generally up and interest rates remain historically low, which makes the cost of borrowing favorable, Foster said. Those factors make the bank’s commercial loan officers optimistic.

“The economy’s improved, so they have more confidence they need to either borrow money or spend money to grow their businesses. They have more demand, they have more need,” Foster said.

“I would say we’re seeing that.”

December 17, 2014 · Fundings · Comments Off

The state of Utah may not like the way Zenefits does business, but David Sacks sure does.

The former CEO of Yammer and first chief operating officer at PayPal has joined the San Francisco cloud-based human resources software developer as COO and made it his biggest venture investment.

The amount Sacks invested hasnt been disclosed but he says it is the biggest investment he has ever made.

He has been making a number of angel investments over the past years, including high-profile fundings of Facebook, Uber, Airbnb, Houzz, SpaceX, and Palantir. He even flirted with joining a venture firm but says he couldnt stay out of the game after he was contacted by Zenefits co-founder and CEO Parker Conrad and board member Lars Dalgaard of Andreessen Horowitz.

I have never seen a software-as-a-service company grow revenue this fast. By comparison, it took Yammer three years to achieve what Zenefits has done in one. Zenefits has reset all the benchmarks, Sacks said.

Conrad said he was skeptical about bringing on a COO when Delgaard suggested it recently but changed his mind when Sacks was mentioned as a possibility.

As the founding CEO of Yammer, he was one of the first people in Silicon Valley to adopt the now conventional wisdom that enterprise software could be built with consumer-grade simplicity and user experience, Conrad said. He was on the front-lines tackling the challenges of hyper-growth at PayPal. My co-founder Laks Srini and I couldnt think of a better partner to help us build Zenefits into a company that will transform the way businesses across the country manage their employees and HR.

Sacks left Yammer, a company he sold to Microsoft in 2012 for $1.2 billion, earlier this year. Since then he says he has been contemplating his next move and playing cards. Theres only so much poker I can play, he told TechCrunch.

He joins Zenefits at a time when it is beginning to get regulatory pushback in Utah and some other places over giving HR departments and small business owners for free the online tools they need to manage employee health benefits, vacation time and payroll. The company makes its money through fees it gets from insurance companies when users buy coverage for their employees through the site.

Utahs insurance commissioner, a former has threatened to ban Zenefits for violating a ban there against people in the insurance business giving away services. But the states governor has sided with Zenefits.

The companys rapid growth apparently has insurance brokers scared that it will to do them what Uber has done to the taxi industry.

Zenefits has grown to 2,000 paying clients and 450 employees since graduating from Mountain View-based accelerator Y Combinator in the winter of 2013. It has has signed a development deal with Arizona to add 1,300 jobs there over the next three years and raised over $80 million in two funding rounds in the first six months of this year. The latest funding came at a valuation of $500 million.

In addition to Andreessen Horowitz, its backers include Venrock, Maverick Capital, Institutional Venture Partners and Hydrazine Capital.

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Cromwell Schubarth is the Senior Technology Reporter at the Silicon Valley Business Journal.

December 17, 2014 · Fundings · Comments Off

Peace Be Unto You:

Items #1 and #6 from the City Manager Agenda, and Item# 2 from the Calendar, for Monday, December 8, 2014.

The first two agenda items, I just mentioned refers to monies that will be appropriated for the up coming local Point-In-Time Count (PIT). The PIT is an annual national count of the homeless, both sheltered and unsheltered. All this year the city has been in receipt of a noticeable amount of monies from HUD and other entities to address homelessness. All homelessness issues or concerns should receive primary attention by members of our municipal government. I recently sent a communication and request, to municipal authorities to enter a resolution on the agenda, to address the death of a homeless woman, who was found dead on a bench in Harvard Square, not so long ago. As of yet nothing has been forth coming in or on the resolution list. It cost absolutely nothing to add to the resolution list, why wasn’t this request respected and acted upon, like all of the others. Was it because there was no HUD or other fundings behind it, compelling it to be entered. I can’t help but to be curious, because I know that everything that relates to the homeless in or region is of the most urgency and significance. The monies that the city receives from HUD and others to address homelessness proves it so. If you all intend on addressing homelessness in the days to come, you must beyond a reasonable doubt demonstrate or exhibit, greater sensitivities to all local homelessness issues, including a new home for the homeless at the Foundry Building, etc., Thank You.


Yours In Peace,
Mr. Hasson J. Rashid
820 Massachusetts Avenue,
Cambridge, MA 02139

December 17, 2014 · Financial Partners · Comments Off

Titus Pittman with Genesis Financial Partners said people are feeling more confident and spending more money, and in turn businesses are feeling more confident and are looking to expand with supply and demand.

Pittman said we still have some big steps to take, but that our economy is getting back on the right track.

People are feeling better about going out, spending more and making purchases they may have not made in the past because of the economy. These are all positive signs for not only the consumer, but also those employers that are behind those individuals, said Pittman.

Pittman said its all about the overall sentiment of the economy thats adding to the recent, optimistic job numbers.

According to Labor Department data, the average hourly wages spiked 37% from October to November, the sharpest month-to-month change in more than a year.

The average American, last month, took home a little more than $853 per month. Thats a 2.4% increase from the $833 (.18) a year earlier.

Pittman said our country is on track to produce more jobs this year since the late 1990s. He said this is a huge milestone and that he sees a lot of positives in the latest jobs report.

Its very broad industries that are hiring, not just your retail or foods and services its also technology and manufacturing so all these are great jobs throughout the board and across our economy, said Pittman.

He said, not only are people getting back into the workforce, but also people are feeling more confident to quit their jobs and move on to one that pays more or better fits their qualifications.

When we had the great recession people that found themselves out of work, probably took some jobs that didnt necessarily match their skill set but to make ends meet you have to take those. Now were seeing a time where employers are hiring more people, so people are not only leaving those jobs but going out and being more competitive in types of jobs they want to take, said Pittman.

As for 2015, he said we should continue to see these trends and he expects more higher-wage jobs to come onto the marker. He also said right now the unemployment rate is around 5.8%, but that it could go down to the 5.3% range in 2015 which would bring the rate back down to average; the first time for that in quite some time.

Pittman predicts that the service industries will be hiring a lot of workers in the new year. Again is all goes back to consumer confidence. More workers will be needed in banking, car and home sales as well as industries like insurance to insure the new cars and homes people are buying again.

December 17, 2014 · Small Business Loans · Comments Off

In the Small Business Lending industry, there has been quite a bit of conversation regarding the unscrupulous practices used by lenders and brokers alike. Some articles have taken an extreme approach in order to sensationalize the industry and attract market attention. One of the topics that is included in almost every broker/lender discussion or forum is that of stacking. Interestingly enough, most business owners have never even heard of the term and are unaware of the conversation that is happening.

So, What is Stacking?

Stacking means to secure an additional unsecured loan or cash advance on top of the loan or advance that a business owner already has in place. For example, if you have an unsecured loan with a lender where you’re making daily/weekly/monthly payments, and you get another loan from another lender in addition to the loan that you already have, you’re stacking. Now here’s the big question everyone’s asking, should stacking be allowed? And if so, under what circumstances? There’s a lot of debate surrounding the issue, so let’s take a look.

First off, other industries are okay with stacking as a practice, and in fact, they embrace it.

How many of us have credit cards in our wallet from American Express, Visa, and Mastercard? When you get a personal credit card, it is highly likely that other credit cards will notice that credit card on your credit profile and begin targeting you. If you decide to get another credit card on top of your first one, you’re going to be stacking your credit cards. In the credit card industry, it’s a widely accepted practice.

Stacking in the World of Small Business Loans

In the world of business loans, stacking is a whole other matter. Businesses usually have a lot of risk involved, and lenders do a lot of research and diligence before they lend to a business. When a business owner stacks a loan on top of one she already has, she will increase her financial burden without consulting the original lender and the lender doesn’t know about the additional risk.

Let’s say you’re a lender who found a small business with $200,000 dollars in annual revenue. You do the work and give them an unsecured loan for $25,000. A couple weeks later, you find out that they layered in a new cash advance for an additional $10,000 dollars. Suddenly, your risk went way up without an increase in reward (interest income). Now, where the real problem occurs is when this scenario happens 1-3 more times, where suddenly that small business has five unsecured loans or contracts, which of course they can’t possibly pay off, so they go under. This not only hurts the business owner, but it hurts the original lender.