There are 5 areas in a lending business - product, acquisition, underwriting, debt capital, and compliance. I share how founders can build a business by focusing on the right things.
Rather than closing the first line of debt facility, how about partnering with a large retail or corporate bank, to basically originate loan for them up to a certain amount, but taking none of the risk. A lead origination play basically (unsure if this would require a formal forward flow arrangement necessitating external lawyers and a $100k price tag - or if this is standard for some retail banks) until you get a solid track record to go an raise the debt?
@Rohit, would love to learn more about this. Do banks ever offload their origination to startups like what Guillaume is saying here? How do I learn more about this? Very relevant to what I'm building.
Can you recommend books/walk me through the process of- 1. raising debt capital 2. The interest we are owed when raising debt capital & numbers ( fees involved etc)
Rather than closing the first line of debt facility, how about partnering with a large retail or corporate bank, to basically originate loan for them up to a certain amount, but taking none of the risk. A lead origination play basically (unsure if this would require a formal forward flow arrangement necessitating external lawyers and a $100k price tag - or if this is standard for some retail banks) until you get a solid track record to go an raise the debt?
@Rohit, would love to learn more about this. Do banks ever offload their origination to startups like what Guillaume is saying here? How do I learn more about this? Very relevant to what I'm building.
This was pretty good :)
Can you provide any examples of org charts that support these functions at an early stage startup?
Can you recommend books/walk me through the process of- 1. raising debt capital 2. The interest we are owed when raising debt capital & numbers ( fees involved etc)
Raising debt capital is a long process. Much longer than raising venture capital.
I wrote another short post here - https://rohitmittal.substack.com/p/lessons-in-raising-debt-capital-for
Hope this helps.