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Reasons Why Merchant Cash Advances Are Now Appealing For Investors.

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Reasons Why Merchant Cash Advances Are Now Appealing For Investors.

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Make Money Within Days

You Will Start Getting Money
Back Within A Week.

Diversify Risk

We Syndicate Investor Capital Across Multiple Advances to decrease risk and exposure.

Make Money Quickly

average advance only lasts between 3-12 months so you can make a great return in a short period of time.

Great wealth is created in great opportunity. Merchant Cash Advances are that opportunity.

Merchant Cash Advances are now open to investors through the Supervest Platform.

Supervest is a platform that allows accredited investors to fund advances, sourced by merchant cash advance funding companies.

MCA funding companies need more capital because the demand for MCA’s is so high, it is hard to fund all of them internally. For the first time, these funding companies are looking to get money from accredited investors so that they can fund more cash advances to businesses that need them.

Supervest is a place where investors can syndicate their money across many different funding companies, and thus even more cash advance opportunities. In fact, when an investor puts their money to work on the Supervest platform, the maximum exposure investors have to one cash advance is 5%.

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Why are you just hearing about this alternative investment opportunity now?

Why do funding companies want more capital from accredited investors?

Here’s why...

The lending industry has changed greatly over the last 30 years, particularly since 2008.

As a result of regulatory changes and changing risk profiles, it’s harder then ever for businesses to gain access to the funds they need to survive.

According to Delaware business now, on average, 70% of businesses under 5mil in revenue per year are being rejected on their loan applications.

The lead-up...

Regulations have tightened around lending practices.
  1. Banks are less risk-tolerant than they once were.
  2. If businesses have only been in operation for less than a year or do not qualify for traditional lending.
  3. If the business owners credit isn’t superb, usually they won’t qualify for traditional lending.
  4. Traditional lending takes time.

For multiple reasons, small businesses are denied traditional loans from banks or the Small Business Association and even if they are approved, sometimes business owners don’t want to wait.

This has lead to a build up in the non traditional financing market.

Debanked’s research estimated the MCA market at over 20 billion dollars worldwide.

If a business isn’t able to easily secure a financial partnership and doesn’t want to use multiple high interest credit cards, the next option is a merchant cash advance.

A merchant cash advance is a financial tool that allows a funding company to provide a business with money as an advance against future sales of the business.

Money goes into the business and it’s paid back as sales are made and the funding company is paid back as a part of every sale.

MCAs can help businesses expand, solve a short-term financial issue, purchase an asset, purchase inventory, launch a marketing campaign, or assist with other business-related ventures.

Merchant Cash Advances

The Basics of MCAs

This type of financing is short-term, typically anywhere from 3 to 12 months. Although, technically it is not a loan rather a business transaction in which there is an exchange of a lump-sum of cash for a percentage of future sales

The financing is unregulated, which means business owners can use the capital however they see fit, unlike traditional loans. To learn about the mechanics of an MCA and invoice factoring, you can look at our Merchant Cash Advance page.

Investing in an MCA

According to Investopedia, the annual average return of the S&P 500 since 1957 is about 8%. The volatility of the market may cause fear for your investment, especially one with that small of a return.

Investing in merchant cash financing, although riskier, can have much larger returns to reap. The margins of this investment have been known to dip into double-digit returns.

Up until recently, investing in a merchant cash advance has been a tightly-held private sphere that has been intertwined with massive amounts of risk. Merchant cash advance funders pay high-interest rates to private equity firms and hedge funds to secure the necessary funding to provide MCAs to various businesses.

Even as an accredited investor, this investment was risky because a large percentage of your portfolio, if not your entire portfolio, would funnel into a singular business. The return of the investment was dependent on the success of the business — in which owners sometimes had little or no business background, bad credit, subpar financial statements, and virtually no regulation on how the cash advance was allocated.

Cons of MCA Investing

Funding any company in shaky times is a risk for even highly accredited investors.

When businesses receive MCAs, they do not have to offer any collateral. So for the investor, if the loan is not remitted, there is no insurance to protect the investment.

Risk was extremely high because investments were not diversified amongst various companies.

The Upside of Investing in MCAs

An alternative investment such as merchant cash advances is great because you are directly helping businesses scale up. There is some satisfaction in helping mom and pop shops produce.

On top of the intrinsic value that is provided, there is potential for massive returns. Returns can reach double digits, which is better than traditional forms of investing.

Extending your investment portfolio to alternative investments like merchant cash advances is a way of mitigating risk and fortifying the portfolio against volatility. Merchant cash advances have little correlation to the stock market. A combination of traditional investing and merchant cash advance investing would offset each other nicely and provide a healthy, balanced return.

Changing Investment Platform

Technology and more easily accessible information is changing the platform in which investments are being made. Platforms for alternative investing are opening up new methods of investing that were previously extremely privately held.

Not only is accessibility increasing, but the cost is decreasing. These platforms are decreasing the minimum amount of investments, which can be more practical for some investors.

Platforms like Supervest for merchant cash advances are connecting investors to merchant funding companies who syndicate investors’ money together for select businesses.

Unlike previous forms of investing in MCAs, this platform mitigates risk extensively. There is a maximum of 5% of an investment in a singular business at a time. The MCA advisors, through the help of Supervest, pool together cash from a multitude of investments. Investors have the potential to be invested in 20 companies at a time.

Investors do not blindly back 20 different companies either, they can hand-select which ones that they want their investment funneled into.

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At Supervest, matches are highly personalized according to risk tolerance and specific preferences with things such as loan term lengths. Professionals take it all into consideration to find the best fit funder and business for the investor.

To become an investor, you do have to be an accredited investor to sign up for Supervest’s crowdfunding opportunity. All you have to do is fill out a basic application, then complete a risk assessment, receive a background check, determine how much of your investment you want to allocate to MCA, and then receive the return in just a few days.

Additionally, Supervest offers 24 hour transparency with your funds, and funding can be removed at any time. MCA investing has never been more easy, less risky, or as straightforward as it is now with Supervest’s platform.

Contact Us Today!

Supervest, LLC

P: 888.548.3801
E: info@supervest.com

1900 E Golf Road
Suite 550
Schaumburg, IL 60173