Kabbage, an SME lending platform, has landed $200m from Credit Suisse to expand its AI-based business loans.
The company said the new revolving credit facility will diversify its funding sources, enabling it to serve more and larger small businesses as it looks to expand into higher lines-of-credit with longer terms.
As a result of Credit Suisse’s backing, Kabbage’s total debt funding has hit the $750m mark. Back in March, Kabbage issued the largest securitization to-date in the online small-business lending space, which was followed by a $25m upsize in six months later.
The deal also represents the first credit-facility transaction for Kabbage rated by rating agency DBRS. This demonstrates recognition of Kabbage’s ability to predictably and responsibly recognise, qualify, and manage risk, serving more than 125,000 small business customers to-date according to the company.
Deepesh Jain, Kabbage head of capital markets, said: “The new, DBRS-rated facility, provided by Credit Suisse, speaks to Kabbage’s maturity in the financial markets and gives us diverse funding options to serve our small business customers.
“To earn an investment-grade rating requires a rigorous evaluation of not only our lending models, automated risk analysis, and successful history of reducing bad debt to an industry-low, but also our operational processes—from exceptional customer service to unmatched technology development.”
Headquartered in Atlanta, Kabbage leverages data generated through business activity such as accounting data, online sales, shipping and dozens of other sources to understand performance and deliver fast, flexible funding in real time.
The company is funded and backed by leading investors, including BlueRun Ventures, Mohr Davidow Ventures, Thomvest Ventures, SoftBank Capital, Reverence Capital Partners, the UPS Strategic Enterprise Fund, ING, Santander InnoVentures, Scotiabank and TCW/Craton.
Last month, AltAssets reported that Kabbage was is in the process of raising $161m according to a filing with the Securities and Exchange Commission.
Three months ago, Kabbage announced a $250m investment from Softbank Group. The start-up said the capital is being used to expand its lending products for small businesses, explore non-lending offerings, and develop its SaaS platform.
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