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iFactor

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A hybrid B2B marketplace for alternative SME liquidity needs via democratised investments.

121%
 - 
Funded 26 Jan 2021
€625,014 target
€760,734 from 205 investors
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Business overview

Location Bucharest, Romania
Social media
Website ifactor-online.com
Sectors Finance & Payments Digital B2B
Company number CIF:35793952
Incorporation date 11 Mar 2016
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Investment summary

Type Equity
Valuation (pre-money) €3.9M
Equity offered 16.32%
Share price €39
Tax relief N/A
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Business highlights

  • Over 1,000 SME applications in just 6 months of public beta
  • Over 12M € secured lending liquidity from banks and investors
  • Novel bank & private investor compliant SME lending platform
  • Supported by leading Blue Chip players in financial, legal & tech
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Key features

  • Secondary Market
  • Seedrs nominee min. €39.00 +
  • Idea
  • Team
  • Updates
  • Investors 205
  • Discussion
  • Documents

Idea

Introduction

Even before the Covid 19 crisis, the lack of working capital was the number one pain in SMEs' growth.

Worldwide, although 4 out of 5 new jobs are created by small businesses, over 90% of SMEs still have insufficient access to funding with a gap of over 2.7 trillion Euro with most SMEs considered low ticket size by the banks, with high processing and underwriting cost.

The post Covid 19 economic crisis will make this situation even worse.

iFactor is an alternative SME lending marketplace where SMEs can sell their outstanding invoices or apply for loans while banks and private investors can bid for these applications.

Developed as a change of paradigm solution, good for growth economic phases, best fit in times of crisis, iFactor is shifting the lender deal orientation towards the borrower, the value creator entrepreneur.

iFactor’s high degree of novelty comes from using proprietary technology in the KYC and underwriting process, digitalising the lending & factoring procedure.

Substantial accomplishments to date

iFactor business model and tech innovation were created in close connection with a deep market need.

In order to better understand our customer's needs, we have done the following steps:

- 160 customer interviews in CEE - Cult Research conclusions in marketing strategy.

- 1,000+ applications during public Romanian beta launch within 6 months with 0 marketing budget.

- Attained €12m secured lending liquidity from banks and investors including Banca Transylvania.

- Business concept and technology validation in acceleration programs.

To continue automation on the platform for a more seamless experience for our users, with the help of our partners KPMG, we're in the process of acquiring licenses and regulatory confirmation letters from the NBR (National Bank of Romania):

Although iFactor is a young start-up, the team has prior experience with EU Subsidy fund raising and we have submitted applications for R&D for iFactor Pure Analytics and SME Instrument Phase II Grants.

Monetisation strategy

iFactor currently employs a success flat fee on both sides, sellers and buyers.

Revenue Stream I 2020:

1. iFactor Hybrid Marketplace (Lending Platform - Workflow Engine and Processes)

In addition to the above model, by which we offer the marketplace, next year we will sell our other home-crafted technological products as white labels, under a SaaS model, generating extra revenue streams.

Revenue Stream II 2021:

2. iFactor PURE Analytics - Alternative Data AI Credit Scoring.
3. iFactor Advanced KYC - KYC distributed data.
4. iFactor Setl - PSD 2/ Open banking Automatic Settlement engine.

In line with this monetisation strategy, clients can also opt to pay additional membership fees and gain lower transaction fees and will be able to access services like cash flow consultancy, collection, insurance etc.

Currently iFactor offers a single invoice factoring product but the platform was designed in a modular way for capabilities of loan applications too.

Use of proceeds

This crowdfunding initiative is a part of a more complex strategy to bring in investments, form partnerships and bring awareness to private investors about trading a new asset class while helping fellow entrepreneurs.

The funds usage breakdown is as follows:

Growth - our rapid scaling plan includes new regional hires - sales representatives, marketing managers, financial strategists, support teams and covering marketing expenses (Campaign assets, Ad & PR budgets, Sales Support, Optimising and lowering CAC).

Technology - further add to our product and engineering team to develop more features, improve processes and launch localised instances of the solution. Introducing the iFactor Pure Analytics Module, an AI based creditworthiness engine ( currently in PoC trials with Raiffeisen Bank International).

Operational Costs - regulatory (localised), legal expenses and EU branches operations.

Our objective for the next 2 years is rapid scaling to reach SMEs in the UK and DACH regions. We have multiple features in development and will be focusing on our product roadmap and reaching our technology and acquisition milestones.

More information about our use of proceeds and detailed planning are available in the document section.

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If you successfully purchase a share lot of this business, you will be granted access.

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Only shareholders can access this page

If you successfully purchase a share lot of this business, you will be granted access.

Buy shares

Only shareholders can access this page

If you successfully purchase a share lot of this business, you will be granted access.

Buy shares

Only shareholders can access this page

If you successfully purchase a share lot of this business, you will be granted access.

Buy shares

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Investing involves risks, including loss of capital, illiquidity, lack of dividends and dilution, and should be done only as part of a diversified portfolio. Please read the Risk Warnings before investing. Investments should only be made by investors who understand these risks. Tax treatment depends on individual circumstances and is subject to change in future.

This webpage has been approved as a financial promotion by Seedrs Limited ("Seedrs"), which is authorised and regulated by the Financial Conduct Authority. It is not intended to be a promotion of any individual investment opportunity and is not an offer to the public. The summary information provided about investment opportunities on this webpage is intended solely to demonstrate the types of investments available on the Seedrs platform, and any investment decision should be made on the basis of the full campaign. Full campaigns are available to investors who have become authorised to invest on the Seedrs platform. All investment activities take place within the United Kingdom, and any person resident outside the United Kingdom should ensure that they are not subject to any local regulations before investing.

Seedrs does not make investment recommendations to you. No communications from Seedrs, through this website or any other medium, should be construed as an investment recommendation. Further, nothing on this website shall be considered an offer to sell, or a solicitation of an offer to buy, any security to any person in any jurisdiction to whom or in which such offer, solicitation or sale is unlawful. Seedrs does not provide legal, financial or tax advice of any kind. If you have any questions with respect to legal, financial or tax matters relevant to your interactions with Seedrs, you should consult a professional adviser.

Tax Relief (SEIS)

This business is eligible for SEIS relief - providing qualifying investors with income tax relief of 50% of their investment and certain other tax reliefs. Tax treatment depends on individual circumstances and is subject to change in future. Click to learn more.

Tax Relief (EIS)

This business is eligible for EIS relief - providing qualifying investors with income tax relief of 30% of their investment and certain other tax reliefs. Tax treatment depends on individual circumstances and is subject to change in future. Click to learn more.

Valuation (pre-money)

Valuation rounded from €3,900,000

This is the fully-diluted pre-money valuation of the business (i.e. before the new investment comes in and including issued options and other equity interests). In contrast, the post-money valuation is based on inclusion of the new investment in the value.

It is calculated as the pre-money valuation plus the amount of new investment. e.g. If Company A is ascribed a pre-money valuation of £1,200,000 by prospective investors investing £300,000, its post-money valuation is £1,500,000.

Pitch type

There are 5 types of investment pitch available on Seedrs.

  • Equity
  • Convertible
  • Fund
  • Cohort
  • Secondary

Investing in a regular equity campaign is the simplest and most common way to invest in a startup. You decide which business you want to invest in, and if the campaign hits its funding target then you will become one of their shareholders. As the company becomes more valuable, so do your shares; allowing you the opportunity to share in the future success of the business.

Learn more about pitch type on Seedrs

Equity Offered

The equity offered is the percentage of the company’s shares being issued in return for the amount of investment raised.

When the amount raised is less than 100%, the equity offered is based on the target raise. Once the company has raised over 100% it is based on the total raised.

In some scenarios, entrepreneurs may accept additional direct investment after closing their Seedrs campaign. Provided this is within 6 months of the closing and on the same terms, we do not typically offer pre-emption rights on that extra investment (where you have the opportunity to invest again to maintain your percentage shareholding).

Learn more about investing and pre-emption rights.

Seedrs nominee

This shows if you are able to choose, when making an investment, that you be represented by, and your shareholding be managed by, the Seedrs nominee.

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Custodian

If you invest in this Campaign, Seedrs will act as Custodian rather than provide our standard nominee service. This is due to the fact that the business is not directly involved in the share sale and Seedrs will not benefit from any rights under a shareholder agreement. As a result, Seedrs will handle administrative tasks as we do normally, but you will not have information or voting rights, updates from the business, preemption on future fundraising, or ongoing support about business trading activity.

Learn more about Custodian here

Secondary market

This shows if the business has opted-in or opted-out of allowing its shares to be bought and sold on the secondary market.

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Direct investment

This is an option to invest and hold shares 'directly' in the company (rather than via the Seedrs Nominee). This option is only available to those investing over the threshold amount, which is determined by the fundraising company.

If you choose to hold your shares directly, you will be responsible for any contractual or administrative arrangements with the company you are investing in.

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Payment options

We are not able to accept card payments for investments into this sector. You can pay for your investment by creating a bank transfer, using funds in your investment account or create a Pay by Bank payment. Your investment will only be completed once the funds have reached our account.

Business Involvement

This Campaign offers shares for sale in business that is not directly involved in this Campaign or the sale. As a result, the Campaign and post-investment experience, including investor rights, will differ from a business-led campaign on Seedrs. Most notably, the business will not engage with investors in the discussion forums both during and after the sale or provide any updates to investors.

Learn more here

Payment options

We are not able to accept Pay by Bank payments for investments into this sector. You can pay for your investment with a card payment, by creating a bank transfer or by using funds in your investment account. Your investment will only be completed once the funds have reached our account.

Drawdowns

This campaign offers the ability to pay for an investment by drawdowns.

Warning

You are following a link outside of www.seedrs.com.

None of the information in constitutes part of the campaign and it has not been approved or reviewed by Seedrs.

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