Clive Pengelly, the CEO of FruiteaPOP, founded his company in 2017. An entrepreneurial success in the Eastern Cape region, the food and beverages company has experienced 100% growth in turnover and is already expanding into other provinces nationally.
Funded Amount: R 300,000
Product: Sale and lease back agreement
Reason for funding: Working capital
Industry: Food & Beverages
Although most 'small and medium-sized enterprises' (SMEs) celebrate growth, they still often find it difficult to cope with the financial demands of their business success. Clive found himself in such a situation in the second year of running his food and beverages company, FruiteaPop.
FruiteaPOP produces Burst FruiteaPOP a '100% frozen fruit juice' popsicle made from Rooibos, which is a unique tea cultivated in the Western Cape region of South Africa. The company was doing well with increasing sales figures and planned expansion into other provinces. Clive had invested a lot of money into freezers to accommodate such projected growth. As orders started pouring in, the business needed cash flow to increase its production but most of its cash was tied up in freezers. The business need funding urgently to meet this increase in demand. A normal bank loan was not feasible as it would take a few weeks to process such an application. At the same time, Clive was well aware that because his new company did not possess the required credit history, he might not get approval for the funds he required. In fact, most of the traditional money lenders shy away from such lending opportunities, unless the respective small-scale business can boast of a strong credit rating or profit history.
Clive turned to the internet to see if he could find another option to help find the funding he needed. A quick search on Google led him to FundingHub a business loan market place for South African SMEs. He was particularly impressed with FundingHub's reputation and recognition as the only independent credit marketplace in SA, featuring banks and dozens of alternative credit companies.
Subsequently, Clive filled out the online loan application form with necessary information about his business and why he needed funding. In no time, he received feedback from a FundingHub representative with a suggestion to choose equipment finance in the form of a leaseback. The beauty of this form of finance is that it's a quick source of business funds and no CAPEX approval is required. Rather than obtaining a loan with unfavourable interest rate terms, he was advised to sell some of those freezers to a credit company and lease them back. This would free up his cash. Further, Clive was introduced to one of the lenders which specialises in asset finance.
Clive was pleasantly surprised by the straightforward and simple application process. Within 48 hours, he was contacted by the lender to discuss his application. After the negotiations and the approval criteria was seen to have been met, the money was transferred to Clive's business account within 24 hours.
From completing the online application form on the FundingHub website - which took less than 5 minutes - to receiving a message from the lender, discussions, filling out the full application form, and receiving the funds, the whole process took less than 6 working days. Clive was also clearly impressed with the lenders customer service, and he described the application process as striking a balance between timely execution and due diligence.
The business obtained R300,000 in finance to meet FruiteaPOP's cash flow needs and support the business expansion. The company's turnover has since doubled and it's expanding into Gauteng and Kwa-Zulu Natal. He commented that the FundingHub site was very easy to use and the service was outstanding. "It's much easier for an SME business like FruiteaPOP to go through FundingHub for funding than trying to find the right lender on your own, the process was quick and efficient," he disclosed.
"From the application process through to final payment, FundingHub were there for me. I will definitely recommend them to others", Clive concluded.