Liberis, the UK-based fintech that provides finance to small businesses like an alternative to a traditional bank loan or an extended overdraft, has replenished its own coffers with £ 70million in funding. The cycle is a mix of debt and venture capital debt, although the company refuses to disclose the payout percentage, so we can probably see this as debt primarily intended to fund loans issued by Liberis.
Funding is provided by previous funders British Business Investments, Paragon Bank and BCI Europe, as well as new partner Silicon Valley Bank (SVB). It brings the total funding raised by Liberis to £ 200million, including over £ 50million in equity. “The new funds will be used to fuel the growth of the company, launch new products and markets and provide additional customer financing solutions,” says the fintech.
To date, Liberis, founded in 2007, has provided more than £ 500 million of financing to 16,000 SMEs in Europe, the United States and the United Kingdom (the product is available in five new countries: United States , Finland, Sweden, Czech Republic and Slovakia). However, lending has really picked up in recent times, with a loan of £ 250million in the past two years alone.
Liberis provides financing for SMEs from £ 1,000 to £ 300,000 depending on expected credit and debit card sales. However, the smart thing is that the loan is repaid via a pre-agreed percentage of the company’s digital transactions. In other words, with the exception of any agreed minimum monthly payment, the repayment schedule is directly related to the size and pace of business card transactions.
It should be noted that the go-to-market strategy has shifted to B2B2B – or “integrated finance” – with Liberis now working mainly in partnership with markets, software providers and acquirers, such as Worldpay de FIS and Global Payments. These partners integrate with Liberis to offer their end customers personalized, pre-approved revenue based financing.
“The core business of Liberis is enabling partners to offer integrated corporate finance to their clients,” Rob Straathof, CEO of Liberis, told TechCrunch. “In 2015, we launched one of the world’s first integrated corporate finance partnerships with FIS’s Worldpay, and have significantly expanded our partnerships around the world in recent years, including Global Payments, Opayo (Sagepay ), EPOS Now and Worldpay US ”
Straathof says that by integrating Liberis’ corporate finance platform into a partner’s existing ecosystem and customer experience, fintech is able to deliver ‘instant value’ to its partners and to SMEs that ‘they support.
“Thanks to our unique API integration, we receive privileged data from our partners, which allows Liberis to offer hyper-personalized and pre-approved financing to SMEs,” he explains. “By making finance more personalized, intuitive and accessible for SMBs, we empower our partners to unleash greater customer value by improving engagement, satisfaction and loyalty, which reduces churn rates. In the end, everyone wins ”.
Comments Folake Shasanya, EMEA Warehouse Financing Manager at SVB: “We are delighted to become a new Liberis financing partner and have been impressed with their ability to integrate financing solutions across technology platforms, payment and more. At SVB, supporting innovation is in our DNA and we are delighted to offer this global growth opportunity to Liberis through our warehouse and risky debt products ”.
Article updated to clarify cycle is a mix of debt and venture capital debt, with no equity financing.