Spartan Capital provides revenue-based financing (RBF) that is specifically tailored to meet the needs of small and medium-sized businesses (SMBs). Founded in 2017, Spartan Capital is focused on helping SMBs get the funding they need to manage operations and grow.
Bridging a crucial market gap
Former small business owners themselves, the founders of Spartan Capital have first-hand experience of the challenges entrepreneurs face in securing financing. Traditional financial institutions such as regional or national banks typically have stringent lending criteria such as time in business, FICO score or annual revenue thresholds. As emergent businesses, some of these criteria are difficult for SMBs to meet. While in the past, regional and community banks could provide working capital, rising interest rates and other financial pressures have reduced the amount of funding offered to this sector. This leaves many deserving businesses without access to credit or capital.
In addition to meeting that need, Spartan seeks to address service and technology gaps along with customized solutions aligned to an individual SMB’s circumstances and goals. Customers have access to an advanced loan servicing platform and technologies that streamline the funding process.
Overall, Spartan focuses on developing and sustaining long term relationships with the clients to whom it offers Merchant Cash Advances (MCAs). MCAs offer an alternative funding option for SMBs across various credit profiles, and funders such as Spartan play a vital role in supporting customers’ operations and growth.
Prioritizing underwriting and credit risk
Spartan has chosen to exclusively partner with ethical and reliable organizations, selected through a meticulous selection and underwriting process, in order to minimize risk and provide a higher quality flow of deals. Once a referral partner presents a deal, Spartan conducts extensive Know Your Customer (KYC) and underwriting to assess the SMB’s ability and willingness to repay the MCA.
This is just the start of the client’s financing journey with Spartan. The firm completes a comprehensive analysis to understand the client’s business, ultimately presenting custom-tailored offers designed to support their long term business growth. In-depth interviews provide insight into daily operations and future plans, helping Spartan identify and address any mutual risks associated with executing a revenue-based financing (RBF) transaction.
Once the funding completes, the commitment continues. Spartan maintains regular and proactive communications with clients to keep them informed and engaged, maintaining a strong relationship built on trust and mutual success and enabling any potential issues to be addressed before they could escalate.
Focusing on quality across diverse sectors
Spartan specializes in executing numerous smaller transactions for high-performing SMBs across multiple industries, including restaurant, retail, dental, medical, pet-related services, and manufacturing. The quality of the borrower and the transaction are paramount – in fact, Spartan’s current portfolio focuses on merchants with a positive track record of good payment history with prior financing providers.
During the COVID-19 pandemic, Spartan’s business model and commitment was put to the test. Unlike many MCA providers who halted operations, the firm continued to provide funding to customers. They prioritized essential businesses that required capital, and helped new referral partners find funding to support their clients.
By staying on top of the microeconomic landscape, and through strong relationships with customers and referral partners, Spartan was able to step into the void left by exiting MCA funders. Their portfolio originations grew by more than 400% and quality remained the priority as they continued to follow their internal underwriting guidelines and best practices.
Supporting future MCA growth with Percent
Through its partnership with Percent, Spartan expects to amplify its origination volume and scale operations. This is expected to address the growing disparity between SMB’s financial requirements and the limited offering offerings of traditional banking institutions. Using Percent’s advanced technology and flexible, cost-effective capital products, Spartan will be able enhance the support and financing they provide to SMBs.
More broadly, Spartan Capital is collaborating with the Revenue Based Financing Coalition and other organizations to educate federal and state government entities. More attention is being paid to the MCA industries, and policy development is underway. Spartan is committed to working closely with regulators to establish equitable regulations that safeguard both customers and MCA funders, so that they can continue providing the vital financing needed by business.