(Reprinted from our sister blog at www.crisispost.com. Take a look!)
I was a speaker on a panel sponsored by www.ibreakfast.com yesterday on “alternate funding sources.” Most of you know I have written a book on reverse mergers and other alternatives to traditional IPOs as a way to take a company public and help move it to the next level. In these difficult times, it is interesting to look at alternate ways to find capital and grow.
Several of the speakers are involved with websites where groups of investors or lenders individually agree to give some money to a company. One site, www.loanio.com, specializes in “peer lending.” As a lender you can go on and offer to lend as little as $50. If you are a borrower, you can set your terms and different lenders bid on the right to lend you the money. It’s a very cool idea. They have suspended operations while they get SEC approval of the securities they issue. But keep an eye on that one.
Another speaker does something similar with receivables at www.receivablesxchange.com. You upload your receivables and well qualified investors buy them, providing 80% of the face amount of the receivable immediately and the rest upon collection. The buyer gets about 1% per month on the money, and a small fee to the site. Much simpler than doing factoring or other ways to finance receivables. Very very interesting.
Thanks to my law colleague Larry Langs for helping arrange the talk.
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