Did you know that merchant cash advance is not just about optimizing lead generation? (even though getting quality deals is a major pain)

In order to fund more deals and bigger size deals, you will need to identify what’s causing your company to plateau.

For example, you might be stuck at $50,000 per month and you can’t seem to go further no matter how hard you try.

This happens due to what is known as a bottleneck.

A bottleneck prevents your company from scaling and being able to handle more business.

Bottlenecks are the main reason why most funders and brokers are lagging way behind in terms of the scale at which they could be operating.

Instead of funding $10 million and more per month, brokers and ISOs are funding way less than a million a month.

Conventional brokers are lagging behind, and now it’s time to learn how to close the gap with systems and technology currently available in the market.

Today, I’m going to reveal to you the major bottlenecks within a Merchant Cash Advance company and how to fix those bottlenecks and scale your business so that you increase the number of quality deals you fund per month.

The first thing you need to do is to ask yourself:

“Where are the bottlenecks in my merchant cash advance business?”

I’ve done years of research into studying top-performing ISOs and finding out what makes them different from the smaller, less successful ISOs.

…And what I found was that all merchant cash advance companies have these bottlenecks in common:

  • Getting quality leads using a repeatable and predictable process
  • Getting merchants to actually fill out an app and then sign it
  • Getting merchants to send 3 months of business bank statements
  • Selling the deal to the merchant
  • Keeping track of all the paperwork
  • Maintaining a strong ongoing relationship with clients for repeat business

Fixing these bottlenecks will allow your cash advance company to move from doing around $50,000 per month to around $1 million per month and beyond.

Now let’s see how we can fix each of these bottlenecks.

Bottleneck #1: Getting quality leads using a repeatable and predictable process

Solution: Inbound Lead Gen System

This system usually consists of some form of marketing: SEO and Content Marketing, paid search (Google, Bing, etc), LinkedIn ads, Facebook Ads, etc.

The backend of the inbound lead gen system leads us to our next bottleneck….

Bottleneck #2: Getting merchants to actually fill out an app and then sign it

Solution: Online loan application and automated signature software

Once your merchant has come in through the advertising and the marketing funnel, you need to get them to take action by immediately filling out a loan app (while this subject is still fresh in their mind).

Send the merchant to your loan application portal and make sure the software you choose has a high conversion rate on signatures (you don’t want to lose a bunch of merchants because they didn’t sign their app at the end).

Examples of loan application signature software:

Bottleneck #3: Getting merchants to send 3 months of business bank statements

Solution: Bank Statement retrieval software

Next, after your merchant has signed his app, you want to automatically redirect him to your bank statements retrieval page.

You have two options for this step in your backend:

Option A: Manual Bank Statement Upload

Option B: Automated Bank Data Retrieval

Your bank statement retrieval page will contain a manual upload box for the merchant’s bank statements, with an optional direct API link to his business bank account (some business owners are not as keen on sharing their bank login, so this is definitely an optional choice to include in your backend framework).

Examples of software that lets you pull transaction data directly through bank login:

Plaid API (a recently released financial software for retrieving bank data)

Bottleneck #4: Selling the deal to the merchant

Solution: Hiring more sales closers and expanding your sales team

Obviously, this is huge. You’re not going to fund $1 million per month and beyond by just being a one-man shop.

And I know most ISOs are passionate salesmen by nature, but you have to put that aside and look at the bigger vision of your merchant cash advance company.

Do you want to keep closing a measly $30K in commissions or do you want to break plateaus, build a team, and absolutely kill it when it comes to cash advance?

In order to start delegating sales, you need to have a solid understanding of how to actually sell merchant cash advances.

Here’s a hint: You need to tie the money to an inefficiency inside the merchant’s business.

Once you’ve sold merchant cash advances for around 6 months to 1 year and you’ve understood why merchants take money at high interest rates, you can start hiring a team.

You need to start by hiring 2 new closers and get them competing against each other. Hiring two guys is better than hiring one and will allow you to split test the closers and optimize your company to hire increasingly better closers.

As your lead flow increases, you will need to add more closers for the influx of deals coming in, otherwise you won’t be able to handle the volume.

Bottleneck #5: Keeping track of all the paperwork

Solution: CRM (important for sales organizations)

Now you’ve got your merchant’s lead information, loan app, bank statements, but how do you keep track of each deal you’re getting? Once you’re hitting big numbers, it will be hard to keep track of merchants. You don’t want to waste a bunch of time sifting through paper files or emails or even a shoddy Dropbox folder.

This is where a quality CRM comes in…

Here are the most common CRM used for merchant cash advance:

Bottleneck #6: Maintaining a strong ongoing relationship with clients for repeat business

Solution: Email Marketing and Automation

CRMs will often come with email marketing and automation built in, but if they don’t, you definitely should invest in this stuff.

Here are some good email marketing and automation companies:

Side note: Be careful going with just any email marketing company. A lot of them restrict certain industries, which may include commercial loans or alternative lending.

Email marketing and automation allows you to touch base with your merchants through automated messages that get sent out in sequences from the time they first apply for a loan, all the way to the time they renew their loan for a bigger funding amount and beyond.

If you don’t keep a good relationship with your merchants and give them helpful content and be a good advisor to them through your emails, they will leave and get funding from somewhere else.

After all, what is your unique differentiation as a broker in the MCA space?

Your knowledge of the industry, your ability to keep your merchant out of the hands of the shady guys in the industry, and your valuable connections with the alternative lenders.

Leverage these things through amazing content delivered through email marketing so that you can build a strong relationship with your merchants.

Overall, while it is true that the technology-enabled lenders have advantages over the underdogs of the MCA industry, they have way more overhead because they hire in house developers and have different departments that set this all up and manage all these systems.

But YOU don’t need to be intimidated by them.

YOU can match them in the technology department because technology is becoming cheaper and more accessible, especially with the explosion of SAAS companies solving each of these problems with their own service.

Outsource your technology by purchasing these subscriptions and let the SAAS companies manage the workload of optimizing the technology while you focus on what you do best as an ISO, which is sales.

Long story short, it’s important to leverage new technology as it becomes available and keep your brokerage firm lean by using SAAS subscription services instead of hiring developers in house.

Before I end this blog post, you’ll be happy to know that we’ve already solved most of these bottlenecks for MCA companies through our innovative inbound lead gen systems that we set up for our clients.

If you want to know more about how we can help you scale and get to the next level in your merchant cash advance firm, check this out…

I’ve created a 30 minute video case study that reveals the EXACT step-by-step system to:

  • Target merchants who are shopping right now and need funding right now
  • Get the merchants bank statements BEFORE you ever even get on the phone with them
  • Create a magnetic effect where merchants come to you instead of you going to them, getting hung up on, or cursed at over the phone

[Case Study] How To Get The Freshest Leads In The Business

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Sean Nayyar
Sean Nayyar

Sean Nayyar is the CEO of Lendnet and has been working in the alternative lending space since 2014. Currently, Sean is helping Small Direct Funders and ISOs in the merchant cash advance space to get more leads by helping them develop their own automated inbound lead gen systems.

    2 replies to "How To Make Your Merchant Cash Advance Company As Efficient As Possible Using Systems And Technology"

    • Tom Ungrady

      We currently do mortgage lending and am interested in commercial lending. I need to find the right lenders to work with before setting up a marketing plan.

      Stay in touch.

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