We sat down with Tradecycle Capital Founder & CEO for a conversation about what drove him to start Tradecycle Capital and what opportunities the company’s service offerings bring to clients.
Q: What is Tradecycle Capital?
A: Tradecycle Capital is a non-bank finance company that offers a very unique working capital solution that helps provide growing companies liquidity with a specific focus on the companies’ payables or procurement. By structuring our business in this way, we have the opportunity to work alongside really solid businesses that are well-supported by traditional senior lenders and capital providers without any disruption to their existing banking relationships.
Additionally, we are a highly tech-enabled business with its own proprietary cloud-based applications that streamline the process for our clients to both pay their vendors and Tradecycle.
Q: How is partnering with TradeCycle different from working with a traditional bank or traditional lender?
A: Since we are a privately held, non-regulated, non-bank entity, we inherently have a lot more flexibility. The Tradecycle model focuses on the timing of a business’ working capital needs and the shortfalls that are not easily supported by traditional lenders. Traditional lenders and banks typically focus on the company’s assets and then are willing to lend some percentage of that, whereas we’re more focused on the actual business cycle.
Utilizing our non-traditional model, we look at factors such as what does the company need, how are they looking to grow and how can we help them with their liquidity to get from point A to point B. Our structure is designed to be a supplemental liquidity tool. This allows us to be a very accretive solution alongside the clients’ current stack of capital providers.
Q: What was the ultimate driving force behind you founding the company?
A: Before starting Tradecycle in 2016, I had 22 years of professional experience under my belt and I knew there was a big market opportunity for a sophisticated supply chain finance product, and having been involved in a number of larger programs, I thought it’d be an interesting model to create a tool that was targeted towards the middle market.
Q: Are there specific business sectors that Tradecycle’s service offerings are best suited for?
A: Tradecycle’s unique model is a product that is highly applicable to just about any business that procures goods and/or services from other businesses. From the beginning, we have been intentionally industry agnostic. While our core client base tends to fall within the manufacturing and distributing sectors, our focus is to find and work with clients who require additional working capital to support their growth.
Q: What are some of the benefits for a company wanting to utilize Tradecycle’s service offerings?
A: Across many sectors, there are a multitude of factors that require companies to go out and procure materials or finished goods whereby the timing of their spend is happening slightly before they have the ability to borrow against those assets under a traditional senior lending facility.
Businesses generally have to procure more inputs to expand and that’s really where Tradecycle fits. Tradecycle is an incredibly flexible business tool and highly applicable to numerous scenarios.
While our program is focused on extending DPO, expanding payable terms, and adding liquidity through that side of the balance sheet, funds can be used for virtually any COGS-related items including expansion into new geographic locations, expediting the transit of goods, paying growers on the agricultural side and more.
Q: What’s the best way to learn more about Tradecycle?
A: Anyone interested in learning more about Tradecycle can visit our website or LinkedIn as well as reach out to Tradecycle Sales Director Paul Count at pcount@tradecyclecapital.com.