Partnership for Growth

General & Bank Partner FAQs


 
 

General FAQ

Who Is P2Bi?
What is P2Binvestor?

P2Bi is the leading marketplace lender for $500K to $10M+ A/R and Inventory lines of credit (LOCs), providing growth capital for soaring businesses. Once approved, your LOC can be funded within 24 hours by, allowing for quick, flexible transparent financing at lower rates than most online lenders. You will only pay for what you use, get to sleep easier at night knowing that the cash gap is closed, and save valuable time by managing your funds on our proprietary online platform. P2Bi is ready to bridge that gap with you and become a strategic partner – how could your business growth dreams come true with a $2M+ line of credit?

Why is P2Bi’s lending platform unique?

Unlike standard industry borrowing vehicles, P2Bi’s platform was built by entrepreneurs, for entrepreneurs. It’s designed to help your business access cash quickly and easily so you have more time to focus on sustaining exponential growth while improving your financial health and increasing profits. Here are some of the features that makes our platform stand out from the rest:

  • Access to accelerated growth capital - Have the cash there when you need it - we’re ready when you are. We combine our unique bank partnerships, our online marketplace of accredited lenders, and our proprietary technology platform to get you the cash when you need it. Not only can we provide $10M+ in financing in as few as 2 weeks, but we can also accommodate additional line increases within 24 hours for a 1.5% fee. And when your collateral increases over time, we can lend against your new collateral almost immediately. We work hard to make accessing your funds quick, easy, and stress-free.

  • Graduate to Lower Rates - As your business gets more profitable, gets bigger orders and expands into larger markets we will review your pricing and consider reductions as appropriate. As you start to approach bankability, with our bank partnership program, we’re able to provide lower rates than other online lending platforms and can make the transition to a traditional C&I customer with a community bank nearly seamless.

  • Ease of use - Our online platform will save you time in planning your cash flow and managing your AR accounting – your finance team will love it! It has zero integration and setup costs, and your dedicated account manager will help you get acclimated to the platform and will be there for any issues that you might encounter as you continue to grow.

  • Financial partnership - As a vested partner, we succeed when your business succeeds. Our team carries decades of experience across a broad range of industries, and with our proprietary online dashboard, we provide clients with the real-time data, financial support, and insight that helps get them to the next level. Most importantly, we aim to bring the human element back into financing. With only half of small businesses making it past year 5, we are here to make sure you not only survive, but thrive through the growth stage. We’ll be here, through the thick and thin to see you to the other side.

Why should I choose P2Bi over a traditional bank loan?

While bank term loans or lines of credit (LOCs) can offer lower rates, they can be difficult to get due to federal regulation, internal controls and a traditionally risk-averse credit posture, especially when it comes to working with newer businesses.

Our business model is designed to support new and growing businesses better than other financing solutions.

  • We provide higher LOCs than most online lenders ranging from $500K to $10M+
  • Our community of online accredited lenders lowers our risk, allowing P2Bi to fund newer and/or not-yet-profitable companies looking for accelerated growth capital.
  • Our unique Bank Partnership Program lets us co-partner with banks to fund your LOC, providing a blended rate that is lower than standard APR rates from other online lenders.
  • We believe you should have flexibility in how you spend your funds. Use your credit line and term loan for payroll, inventory, office space, or anything else.
Tell me more about your Bank Partnership Program? How does that benefit my company?

Our Bank Partnership program is really a win-win-win scenario for growing businesses, community banks, and P2Bi.

How it benefits your business:
Every growing business would love to reach the point where they are working off a LOC from an established bank. Banks provide the lowest APR rates and businesses are able to draw larger credit lines than other online funding options. Unfortunately, many companies are too young and too risky for banks to take a chance on them.

Luckily, P2Bi has the unique ability to work directly with a bank to co-fund your line of credit. This allows you to kickstart a bank relationship that would be non-existent in this stage of your company’s lifecycle. In addition, P2Bi and the bank are able to provide a blended APR rate that is much lower than other online lenders. As you company continues to grow, your risk will lower and P2Bi can graduate you to a full traditional C&I bank partnership, giving you the low interest rates you’ve always dreamed of.

With P2Bi, you never have to switch lenders as your company grows. We’re with you every step of the way: from your growing pains as a small startup all the way to passing you off your recognized and successful company to an established bank.

How it benefits the bank:
Each bank wishes they had a crystal ball to tell them which businesses will be successful and which businesses will fail. Sadly, that’s not that case and many banks play it safe and only provide business loans and lines of credit to established companies that have a long track record of proven success.

The P2Bi Bank Partnership program gives banks access to high-growth businesses early in their lifecycle with half the risk (P2Bi takes on the other half). This lower risk model gives banks more confidence to take a chance on small startups and provide them funding they need during their initial growth phases. When these startups continue to grow and become more recognized and established, they will graduate from the P2Bi Bank Partnership program and look for a traditional C&I bank relationship. And who will they choose? The bank that has been with them since the beginning.

How it benefits P2Bi:
Simply put, P2Bi’s relationships with banks allows us to provide low rates to our clients than our competition and brings us additional clients to our platform. Splitting the financial risk with the bank provides a blended rate that no online lender can match. In addition, we can promote the benefit of jumpstarting an early bank relationship with a bank that would otherwise be non-existent.

Am I a Fit?
What type of businesses are the best fit for a line of credit from P2Bi?

Our product is perfect for companies facing a variety of challenges. With our financing solutions, you can:

  • Make your cash flow smoother and more predictable.
  • Increase your ability to fill new and future orders.
  • Avoid being limited by slow-paying customers.
  • Use the capital as you need to grow your business, free from the use-of-funds restrictions imposed by other lenders.

For example:
Company X—a granola company—must pay upfront for materials, production, and shipment to stock shelves at Whole Foods. While Company X waits to get paid, a big order comes in from Safeway. Without payment from the first order, Company X doesn’t have the funds to cover the upfront costs of the new order and will risk losing the opportunity to work with Safeway and grow its business. P2Bi can provide a LOC within 2 weeks to Company X to cover the costs to produce the incoming order. Company X only pays a discount on what they draw on their line of credit.

or

Company Y—a staffing company—is responsible for paying its employees on behalf of its clients ahead of receiving payment itself. Company Y typically floats payroll anywhere from five to 30 days and needs operating cash to keep the business running while it waits for payment. The LOC from P2Bi can cover the cash gap that Company Y is currently experiencing and gives them the flexibility to continue to grow the company at a rapid pace.

An ideal candidate for P2Bi has the following characteristics:

  • 1+ year in business
  • 10-30+ employees
  • B2B Business
  • Experienced management team
  • Has A/R to lend against that mostly pays within 90 days
  • $2 million - $10+ million in revenue
  • 10% + annual revenue growth
  • Trending toward cash-flow breakeven or already profitable

We cannot provide LOCs to the following industries:

  • Construction
  • Real Estate
  • Medical Insurance Billing
  • Cannabis
What does the P2Bi application process look like?

Initial qualification to funding can take as little as two weeks. Required steps are outlined below:

  1. Qualification. This starts with you. Just contact us online via our Get Started form. You can also email us at hello@p2bi.com or call us at 720-361-1500. We will work with you to better understand your business needs and determine if you are eligible for our LOC products.

  2. Application. If you qualify, your next step will be to provide documentation (listed below) so that we can explore what lending options work best for you. We will then issue you a Term Sheet.

    • Balance sheet, as of the end of the last closed month
    • Balance sheet, as of the end of 2017
    • Income statement (P&L), current YTD (through end of the last closed month)
    • Income statement (P&L), full year 2016
    • Accounts receivable aging report, current YTD (through the end of the last closed month)
    • Accounts payable aging report, current YTD (through the end of the last closed month)
  3. Term Sheet. The term sheet is non-binding and outlines the terms of the facility, including effective rate and preliminary line amount based on current A/R balance, revenues, strength of payors and a few other factors. By signing the term sheet, you authorize our team to begin an underwriting review in anticipation of completing a final comprehensive borrowing agreement.

  4. Underwriting. The credit underwriting process takes about five to ten days and once completed successfully, you’ll receive the final borrowing agreement to review and sign.

  5. Onboarding. The final, but important step. We provide a one-hour tutorial of our platform and an introduction to your account manager on the Client Success Team. These are the folks that will be working with you to manage everything in relation to the best practices in managing your account. They want to see you succeed as much as you do!

How Does It Work?
If you’re not a bank, how do you source your lending capital?

We provide some of our own capital to fund advances, however most of our facilities are funded by our crowd of accredited investors, which as of early 2018 includes about ten institutional investors (hedge funds and family investment offices) and over 200 accredited investors. When you secure an a LOC with P2Bi, your line amount is guaranteed, and we use a combination of these capital sources to fund it.

With our proprietary technology platform, our investors can advance and withdraw funds on a day-to-day basis. This gives P2Bi significant advantages in lending flexibility and speed over banks and other capital providers.

Importantly, when clients perform well, investors take notice and are more likely to support further progress through additional investment.

For example:
Company Z has a line set up for $500K to fund the production of its nutrition bars. Recently the company learned that Whole Foods wants to increase its shelf space, which will require boosting production capacity quickly.

With an additional Whole Foods invoice for $250K, Company Z requests an increase in line capital. Our Operations Team approves the increase, which is then reviewed and approved by our Credit Committee, and ultimately results in the expanded line becoming available quickly after Company Z’s request.

If you qualify for our Bank Partnership Program, your LOC will typically be funded 50% by the bank, and 50% by P2Bi and our crowd of investors. This mixed financing allows for lower discount rates and an early relationship with a bank.

How does your proprietary platform work?

The P2Bi platform is the go-to online dashboard for our clients. From the platform, companies can make funding requests, see paid invoices and incoming payments, follow the history of funds drawn and discount charged, etc. The platform is totally transparent giving you a complete breakdown of every cost involved and how your availability works.

Behind the scenes, we use a third-party lockbox account to collect paid invoices. Our Operations Team processes and reports on invoices as they come in and will update a company’s available line balance within a business day of invoice submission, though often it is within hours after a ‘non-intrusion invoice validation procedure’.

How do you determine the amount of my credit line?

How do you determine my credit line amount as well as the rate I’m charged?

Your credit line is largely determined by the value of assets available to secure the line (primarily A/R and in some cases inventory). Other factors can also be considered, such as the amount you request, years in business and growth trajectory. The same goes for your term loan, however your term loan must be eequal to or less than your P2Bi LOC.

We have an experienced team of underwriters who will analyze your financials and determine a fair line of credit and discount rate in order to provide you the capital you need to grow while equally managing the risk of the financing package.

What is the difference between your line of credit and term loan products?

Our primary product is our Line of Credit product, which gives you access to capital to better manage your cash flow on a dialy basis. In addition, you are only charged on what you use.

Term loans can supplement your P2Bi Line of Credit if your business has any short-term, large purchases that will benefit your company in the long run. Simply reach out to your Client Success Manager and we can quickly underwrite you in a matter of days so you can use the immediate capital to help your business grow.

Which P2Bi product do I need?

Our Line of Credit and Term Loan product serve very different needs in a company's growth:

Line of Credit

  • You need to solve cash gaps created by your accounts receivable
  • You’re trying to improve your cash position
  • You’re looking for daily payments only on what you use

Term Loan

  • Your growth requires immediate increases in production and staffing
  • You need to buy new machinery or equipment
  • You’re seeking consistent monthly payments over a set amount of time *P2Bi Term Loans are a supplemental product to our line of credit. It’s amount cannot exceed your current LOC.

Every business has unique needs, so we'll build you a custom financing package to make sure you're set up with the capital you need to grow.

Does the LOC require collateral?

Yes. Your LOC is secured by A/R, and in some cases finished inventory is also included. Unlike other factoring firms, which advance funds on a per invoice basis, we determine your borrowing capacity based on eligible current assets (A/R or inventory). This is your borrowing base and is a dynamic number that may fluctuate as often as daily.

In most cases, you can draw up to 70-80% of the full value of your A/R and between 25-50% of the value of your inventory. This percentage depends on criteria such as the strength of your paying customers and whether your business is profitable. Specific terms will be reflected in your contract but can also be reviewed to make changes if and when appropriate.

Why can I draw only 70-80% of the value of my A/R?

This 70-80% limit is a cushion that helps us manage our lending risk and helps you manage your borrowing risk. Every business has invoices that will be paid late, will be disputed or not paid at all. A slightly lower borrowing limit protects both parties against invoices that don’t pay 100 cents on the dollar. This practice is standard among all online lenders providing LOCs against A/R.

Is any collateral excluded from eligibility for my borrowing base?

Yes, some collateral is excluded. We cannot consider:

  • Medical insurance receivables due to insurance billing (medical device or service provider companies are okay, however)
  • Perishable, unpackaged food such as fresh fruit
  • Receivables from within the trucking industry (although logistics companies are okay)
  • Construction where subcontractors and/or retainage billing is used
  • Consumer-facing receivables
  • Invoices that are considered aged beyond 90 days, though some exceptions can be made.
Is a guarantor required?

Yes, we do require that any equity owner with 20%+ stake in the business sign a personal guaranty. If there are no significant owner/operators, we require the CEO to sign a validity/good actor guaranty. Any additional personal guaranties provided can help us offer more advantageous terms.

What happens if my company defaults on our line of credit or term loan?

In the event of a default on the LOC or term loan, the first assets that provide liquidity to pay off the loan are cash held in the accounts of the company and payments on invoices made by the company’s clients.

Secondly, the inventory is sold. Third, the remaining assets of the company or the company itself are liquidated to cover off the amounts owed on the loan. If these sources of capital are insufficient, then the lender is forced to go after the loan guarantors for the gap.

However, there have been some instances where P2Bi was able to work with some borrowers to provide a temporary term loan on a specific invoice to help the company work through events where the sudden and unexpected failure of a distributor and client would have otherwise put the company in default. While there is no guarantee that this approach is feasible, our doors are always open for a conversation prior to taking action, or even when action has been taken.

There are many ways you can mitigate your risk of a default. First, aim to have a diversified client base. The more diversified your client base, the less likely you are to be forced into a default situation by the failure of a customer. We get that this may be difficult at first, but nonetheless sound advice we follow ourselves in our portfolio allocation.

Second, at all times, but certainly if you are in default, do what you can to ensure invoices that are used to back your line are paid in a timely fashion. Work with your lender to identify a buyer for the inventory and/or other assets. This will help ensure the gap, if any, is small and limit or eliminate your liability altogether.

Third, if this is a serious concern, trade credit insurance is a form of insurance that can protect you and your business against the failure of a customer. If you already have one, you may use your own preferred vender.

Fourth, maintain adequate assets on your balance sheet and liquidity to cover any shortfalls from payors.

What Does It Cost?
What are the costs of a LOC?

Unlike other factoring firms that charge on the value of each invoice purchased, we charge only on the dollar amount you draw from your line.

Specific costs for a P2Bi LOC include:

  • A one-time origination fee (equal to 1.5% of your maximum credit line) that covers due diligence, underwriting and onboarding costs.
  • A daily discount cost on outstanding principal that gets paid down with any receipt.
  • An annual renewal fee (equal to 1.5% your maximum credit line, which includes and line increases that might have occurred in the previous calendar year.
What discount rate can I expect on a P2Bi LOC?

Average annual discount rates range from about 8-20%, depending on the client and line amount as well as whether you qualify for our Bank Partnership Program. Discount is charged daily on a non-compounded basis only on the borrowed amount outstanding at the end of the work day.

For example:
On January 1, Company X borrows $100,000 of a $500,000 LOC at a daily discount rate of .0493%. Discount for January 1 is calculated as: $100,000 (principal borrowed) x .000493 x 1 day = $49.30.

How are payments applied to an outstanding LOC?

When an invoice payment comes in, we apply funds to the discount first, then outstanding principal. If a payor’s remitted funds exceed the value of your discount and outstanding principal, the remaining capital will be forwarded directly to your bank account.

For example:
On Day 1, Company X borrows $100,000 of a $500,000 LOC at a daily discount rate of .0493%. Discount for Day 1 is calculated as: $100,000 (principal borrowed) x .000493 x 1 day = $49.30.

At the end of Day 1, $100,000 (principal) + $49.30 (discount) = $100,049.30 outstanding.

With $100,000 outstanding, if eligible collateral becomes available to the credit limit of $500,000, an additional $150,000 can be accessed. On Day 2, $35,000 in paid invoices comes in. These funds are first applied to the $49.30 in outstanding discount. The remaining $34,950.70 (or $35,000 - $49.30) is applied to outstanding principal of $100,000. This leaves $65,049.30 (or $100,000 - $34,950.70) in outstanding principal.

Discount on Day 2 is calculated as $65,049.30 (principal) x .000493 (daily discount) x 1 day = $32.07.

At the end of Day 2, $65,049.30 (principal) + $32.07 (discount) = $65,081.37 outstanding.

As mentioned previously, additional line capacity opens up as eligible collateral becomes available.

How Do We Compare To Other Lenders?
Why should I choose P2Binvestor over another lender?

P2Binvestor isn’t like other lenders. We combine deep understanding of early stage growth management issues, a syndicated risk model and a proprietary technology platform to provide scalable capital in real time that uniquely supports growing companies.

We saw an opportunity to disrupt the finance industry and replace dated, inconvenient ways of borrowing money with something much more simple, transparent and user-friendly.

We really care about our clients - we are entrepreneurs ourselves, so we get it. With only half of early stage businesses making it past year 5, we are here to make sure you not only survive but thrive through the growth stage. We’ll be here, through the thick and thin to see you to the other side. Our Client Success Team will help you manage your funds, access more funds if necessary, and make the cash flow part of your business just a little less stressful. We aim to not just be a blip on your balance sheet, but a real-time financial partner that is there when you need us.

How is P2Bi financing different than other asset-backed lines of credit?

Many people often group factoring, PO financing, an asset-based lending into the same pool of lending, where in reality the funding methods are quite different.

Factoring is a type of funding vehicle in which a business sells its invoices (A/R) to a third party at a discount in exchange for cash. The business’ payors send payment directly to the third party. However, factoring companies charge interest on the whole value of the invoice, even if the company doesn’t need the whole value of the invoice.

Factoring example: Company Q sells wireless keyboards and receives an order from Best Buy for $500,000 of their product. However, Best Buy doesn’t have to pay Company Q for 90 days. Company Q know in the next 90 days it will need to build more inventory to build more future orders from their other customers. They estimate this will cost $200,000.

Company Q can go to a factoring company and show them the $500,000 invoice from Best Buy and the factoring company will lend them the total amount of that invoice and will charge them interest on the whole $500,000 loan, even though Company Q only needs $200,000. Essentially, Company Q is paying daily interest on roughly $300,000 in money they don’t need at this moment. When Best Buy finally pays the $500,000 bill, they pay the factoring company directly and the loan is considered settled. Company Q has to repeat this process with each new invoice that they receive.

With purchase order financing (P.O. financing), capital is extended from a third party directly to a supplier, with payment later upon delivery from the end user. Funds go to the supplier to fill the order rather than to the business to use for other purposes.

P.O financing example: Company R manufactures and sells and energy drinks to retailers nationwide. They receive a purchase order from Costco for $100,000, but all of their funds are tied up in other parts of the business. They can go to a lending company and show the PO for $100,000 and they will lend Company R $100,000 to fulfill that order, who will then have to pay standard interest rates and other fess on the loan. The $100,000 Company R receives must be used only to fill that specific order and cannot be used for other parts of your business like payroll or marketing. When Costco finally pays the $100,000, the funds are deposited directly to the lending company’s account and the loan is considered closed. P.O financing is great for fulfilling individual orders but are not ideal for helping grow your company.

P2Bi uses a unique asset-based lending model that takes the best parts of factoring, P.O financing, and asset-based lending to create the best user-experience possible. P2Bi will lend against your entire A/R balance (not individual invoices) and will also lend against your inventory. Finally, we only charge you on what you choose to use and you have to flexibility to use your funds on whatever you need to help grow your business. We’re giving you a line of credit to use how you want it, when you want it.

P2Bi example: Company Y is a beef jerky company that sells their product to several grocers and retailers across the United States. When they are ready to start working with P2Bi, they are able to upload all of their invoices and inventory to our online platform and we are able to compute an asset-based line of credit based on everything they uploaded. In this case, P2Bi grants Company Y a $1,000,000 line of credit that they can draw on to help grow their business. Do they need money to develop a future product? Use our flexible LOC. Do they need to hire more employees to their sales team to bring in more revenue? Use our flexible LOC. Company Y has the ability to use their line of credit to pay for whatever they need. And Company Y will only be charged for what they actually use. So if they only need to use $200,000 of their $1,000,000 credit line, that’s all they will be charged for. Incoming payments from these grocers and retailers pay off the outstanding balance on their line of credit, which gives Company Y the ability to continue to draw from their LOC as they grow. Everything is managed on P2Bi’s online platform so you can manage your account quickly and easily, so you can put your time towards the other parts of growing your business.

I found a rate that is cheaper. Why might I still consider P2Bi’s financing?

If you found a rate that you believe contains no hidden fees, you still may want to consider that our financing has no covenants, no restrictions on line usage, and as such, is often a much more flexible solution than those offered at lower rates.

In fact, if you’re not sure how to compare other offers, we’re happy to help you sort through other term sheets to help find any hidden fees and clarify your exact cost.

With P2Bi, you can spend the capital on whatever you need to keep your business growing–payroll, inventory, bulk ordering, etc. Other lenders often restrict how you can use your funds–we don’t.

If you secure bank financing at a lower rate, we will make every attempt to match it within three days. If we can’t, you can leave your contract without penalty.

What if your financing isn’t the best fit for my business?

Every business has unique financing needs, and we understand that receivables financing might not be the best fit for your business. If you’re better suited for purchase order financing, term loans, or another financing option, we’ll let you know why and we’ll work with our extensive partner network to help you get the right kind of growth capital.

Who are your competitors?

Alternative lenders provide capital to businesses who can’t or chose not to, get a loan from a bank. They include traditional accounts receivable factoring firms and firms that use other sources of collateral for security (real estate, equipment, etc.). When compared to P2Bi, many alternative capital providers offer higher fees, less transparency in pricing and unclear terms. Covenants can be limiting and client support, in terms of financial insight and online data and management, is often lacking. They also don’t have our entrepreneurial focus, which uniquely positions us in the lending market.

Examples of alternative lenders include BlueVine, Charter Capital and OnDeck.

Bank Partnership Program FAQ

What is the P2Bi Bank partnership program?
What is the P2Binvestor Bank Partnership Program?

P2Binvestor (P2Bi) is a fintech company that deploys a proprietary servicing and monitoring platform to deliver ABL lines of credit to growing companies efficiently and seamlessly.

In 2017, P2Bi launched its Bank Partnership Program, enabling partner banks to offer an ABL product to growing businesses who do not yet qualify for a traditional C&I facility.

P2Bi’s Bank Partnership Program does not require any technology investment, data integration, or headcount increase. It is uniquely designed for community banks that want to increase their C&I portfolio and build a client book. Program participants can expect typical net yields of 5-7% on ABL LOCs, including servicing costs.

How does this program work?

P2Bi’s Bank Partnership Program mitigates the risks and costs associated with a traditional ABL program by providing real-time data, stringent underwriting, and robust risk monitoring processes. By combining human expertise with advanced technology, we enable banks to grow their portfolio without increasing associated risks.

How it works:

  • We source, screen, and underwrite (with bank input) clients trending toward profitability with $1M+ in revenue.
  • After careful due diligence and asset verification, details of accepted deals are provided to the bank partner, who then reviews and approves participation.
  • For each approved deal, the bank purchases a 50% participation from P2Bi in an ABL facility, receiving priority on collections and voting rights on credit management.
  • Our marketplace of institutional and accredited investors join as junior participants.
  • Together, these funding sources provide clients with a single line of credit at an affordable, blended rate.
  • As clients grow, they can graduate into the bank’s traditional C&I portfolio as soon as they qualify.
How will the Bank Partnership Program benefit my bank?

Participants in P2Bi’s Bank Partnership Program will receive:

  • Business deposits from each new client.
  • An ABL product that immediately generates revenue—no technology investment, hiring increases, or integration required.
  • The opportunity to build early relationships with growing businesses and graduate them to a traditional C&I facility as soon as they qualify, increasing the lifetime value of high-growth clients.
  • The ability to diversify their commercial lending portfolio while still maintaining control over credit quality.
  • An easy-to-use custom bank portal that shows real-time portfolio data, collateral quality, and key loan performance indicators for every participation.
What types of borrowers qualify?

We source high-growth clients that are scaling fast and want to build a bank relationship. Characteristics typically include:

  • Clients seeking ABL lines of credit ranging from $750,000 to $5,000,000.
  • Clients with $1,000,000+ revenue, are EBITDA positive or trending toward profitability, and have at least 20% annual growth.
  • Industry exclusions: construction, real estate, medical insurance billing, cannabis.
Where does deal flow come from?

P2Bi manages a direct ABL lending portfolio. Our sales team finds growing businesses that need ABL financing and we regularly graduate clients out of our direct portfolio into our Bank Partnership Program. Deal flow can also come from a bank’s commercial sales team or as a workout from its C&I portfolio.

What is the underwriting process?

P2Bi’s underwriting team takes a 5Cs approach and incorporates a closer inspection of receivables and inventory as primary sources of repayment. We review corporate financials, tax returns, and run background and credit checks on all relevant corporate entities, owners, and guarantors. We prepare a complete underwriting file analyzing payor performance, collateral coverage, business cash flow, guarantor strength, and balance sheet strength about each client for the bank to review.

What makes P2Bi’s program different?
How is P2Bi different to other marketplace lenders?

P2Bi bridges the gap between pre-profitable companies and community banks, providing clients with the fastest path to bankability. Our goal is to transition clients into a traditional C&I portfolio as soon they qualify. In addition to enabling clients and banks to build early relationships, we provide clients and banks with access to cutting edge-technology that enables account management and monitoring in real-time. We have a history of success, funding over $400M to borrowers since our inception. 89% of community banks believe bank and fintech collaborations will be common by 2027. Will you join the wave of innovation?

Why is this ABL program different?

P2Bi is not another software company. No technology integration or extensive training is required. We are a strategic partner that helps banks grow their C&I portfolio by sourcing deal flow, handling day-to-day client management, and ensuring clients have a superior ABL experience. Unlike a servicing-only partner, we match a bank’s client funding dollar for dollar, and as junior position participants, our revenue and growth are tied to the success of the program and the performance of the credits in the portfolio.

How are investments managed?
What control do we have over the underwriting and credit monitoring?

P2Bi is the primary servicer and manager of the credit, but we provide bank partners with a real-time portal to view all underwriting information, A/R aging information, and covenant performance metrics.

Any credit can be reviewed upon request, and any significant issues are immediately surfaced to our bank partners. Unlike a traditional ABL program with monthly data updates, bank partners have constant access to the latest information and are alerted immediately to major account anomalies.

What does the P2Bi platform do?

P2Bi’s proprietary technology was built to optimize the line of credit servicing, risk management, and reporting intricacies involved with asset-based lending, in addition to delivering substantial efficiency improvements in screening, document collection, and syndication.

The platform also provides clients with a seamless application and account management process, competitive with other online lending experiences.

How complicated is integration and set-up?

It typically takes 60-120 days to set-up a bank partnership. As there is no technology integration, set-up involves agreeing on legal contracts, performing due diligence, and agreeing on workflow processes.

Who is P2Bi?
Who is P2Bi?

P2Bi is based in Denver, CO and was founded in 2012. It is the leading marketplace lender for multi- million-dollar financing and has originated over $125 million in asset-based lines of credit. Its team consists of specialists in underwriting, risk management, and commercial business lending, with a strong emphasis on managing asset-based lines of credit. P2Bi averages less than 2% non-accruals over outstanding funds with a strong recovery record on charge-offs.