Fintech Startup: LoanFlare - a look back two years on.

November 19, 2019

I found an interesting article (albeit 2017) regarding a now defunct company: LoanFlare.

Look at this article , company closed with administrators called in over $20,000 in debts.

The LoanFlare’s business model was $500 per month for brokers ($300 for early adopters/founders).

My understanding of the broking business is that:

  • the business model is based on slim margins and rely solely on signing bonus and trailing commissions.
  • business cash flows are inherently unpredictable due to a variety of economic, competition, and property cycle factors.
  • brokers main differentiator is the face to face, and personalised service offered to their customers. The business itself is the CRM.

With any startup, it is very important to plan and execute on growth strategy, and to establish a steady revenue stream. In order to achieve a higher chance of success to , a lean operating model which entails keeping operating costs to a minimum should be incorporated in the daily operations of the fintech startup.

It would be interesting to find out what the composition and the timeframes of the build up of this operating debt.

Reference: (page 10 and 11)

Written by Vincent Choy. Follow CCRHub on Twitter