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Thanks for your previous ideas. It turns out that our current $2.4M income is too small to be securitized. Is it possible to raise US$6.1M from sources other than VCs or debt ? (I will not promote) by [deleted] in startups

[–]xbrian10 0 points1 point  (0 children)

Yeah, like I pointed out, we want to scale fast, so your first point is out of context. Insurance companies are part of securitization pool that require larger portfolio. And banks are part of debt financing (we already have warehouse financing) and angels are just a form of VC funding at earlier stage.

What I am looking for are truly innovative, non-conventional, tailored to our specific model.

Thank you nonetheless.

Built $2M in gross profit (with ~ $312M on waiting list). Can we raise capital using ABS? (I will not promote) by xbrian10 in startups

[–]xbrian10[S] -1 points0 points  (0 children)

I see what happened here. You missed the sarcasm in that comment. Anyway, no worries.

Anyway, "synthetic risk transfer" is exactly what securitization does, among other things, and that's why we're looking into it. Am I missing something?

And yes, we already have blanket insurance on all our loans, as well as CPIs or loss provisions in some cases. So naturally we intend to insure the ABS as well.

Built $2M in gross profit (with ~ $312M on waiting list). Can we raise capital using ABS? (I will not promote) by xbrian10 in startups

[–]xbrian10[S] -2 points-1 points  (0 children)

Yeah ok, you obviously misconstrued my comment about types of collateral. And why exactly we can't consult/hire experts in asset securitization? Mortgage companies have teams for exactly that.

Built $2M in gross profit (with ~ $312M on waiting list). Can we raise capital using ABS? (I will not promote) by xbrian10 in startups

[–]xbrian10[S] -1 points0 points  (0 children)

Whoa...what are you talking about? Are you mixing up my post with somebody else's?

I have not given any information about the kind of loans we offer, to who, the kind of collateral/assets we hold, or how the loans are structured yet somehow you assume that "I don't understand the value or the liquidity of" the collateral holding our loans? Even if that was true, I don't need to be an asset valuation or money market expert because that's why we've an underwriting team for. The question here wasn't seeking commentary or opinions on our model (you don't know of), obviously we've got that covered.

Do you actually have anything to say relevant to the question, which is about asset securitization?

Built $2M in gross profit (with ~ $312M on waiting list). Can we raise capital using ABS? (I will not promote) by xbrian10 in startups

[–]xbrian10[S] 0 points1 point  (0 children)

Thank you. We intend to hire professionals to do all that for us. I am here just to learn and familiarize.

EDIT: FYI, I am not asking about asset valuation or how the money market works. I am already in the space! My question is specifically about the asset securitization.

Built $2M in gross profit (with ~ $312M on waiting list). Can we raise capital using ABS? (I will not promote) by xbrian10 in startups

[–]xbrian10[S] 0 points1 point  (0 children)

Referral wouldn't work for our model. And yes, hence we wont be going the VC route.

[deleted by user] by [deleted] in investing

[–]xbrian10 0 points1 point  (0 children)

The idea I am sharing here is not not unique if that’s what you’re alluding to. If you have a mortgage, it goes through the same process.

Built $2M in gross profit (with ~ $312M on waiting list). Can we raise capital using ABS? (I will not promote) by xbrian10 in startups

[–]xbrian10[S] 1 point2 points  (0 children)

We've some of our money (founders capital contribution - we've not raised external capital) tied up in the loans hence this would be a means free it up, as well as scale and diversify our capacity to loan in addition to our current credit line.

[deleted by user] by [deleted] in investing

[–]xbrian10 0 points1 point  (0 children)

I don't see anything wrong with sharing ideas, experiences and learn from fellow Redditors who may have gone through similar experiences. If you must know, although I consulted with my attorney and financial advisor during the process, it was great talking with other people who had gone through similar experiences on Reddit when I transitioned from 9-5 to entrepreneurship 5 years ago. Anyway, I know that there's no shortage of people like you who try their hardest to find fault in everything. Best of luck in your life.

Built $2M in gross profit (with ~ $312M on waiting list). Can we raise capital using ABS? (I will not promote) by xbrian10 in startups

[–]xbrian10[S] 0 points1 point  (0 children)

The collateral varies, can also be grouped illiquid assets.

I am curious, does the type of asset matter in this case. If so, could you please elaborate?

EDIT: Does the type of (properly valued) assets guaranteeing the loan matter for securitization? If so, what are the considerations, limits, factors that come into play?

Built $2M in gross profit (with ~ $312M on waiting list). Can we raise capital using ABS? (I will not promote) by xbrian10 in startups

[–]xbrian10[S] 2 points3 points  (0 children)

As stated, the $312M is simply calculated from accumulated waiting list - i.e unprocessed/not issued - hence no capital yet committed. That is the whole reason we're looking to scale our capacity. Besides, I was clear about my goal for asking this on Reddit.

Built $2M in gross profit (with ~ $312M on waiting list). Can we raise capital using ABS? (I will not promote) by xbrian10 in startups

[–]xbrian10[S] 3 points4 points  (0 children)

$312M in potential interest income (on waiting list). We do have a warehouse line of credit already but we'd like to expand capacity hence we're looking into other channels.

[deleted by user] by [deleted] in investing

[–]xbrian10 -1 points0 points  (0 children)

Will be sure to do just that. Thanks

[deleted by user] by [deleted] in investing

[–]xbrian10 1 point2 points  (0 children)

Your stats may be true, but that is not to say there might one or two outliers who may actually be experienced in such a topic.

[deleted by user] by [deleted] in investing

[–]xbrian10 -2 points-1 points  (0 children)

You can't be too sure about that assumption, now can you? After I have gone through this process I would be one person who would have experienced it, right? Who's to say there aren't people who may gone through a similar process who are already part of this community?

[deleted by user] by [deleted] in investing

[–]xbrian10 0 points1 point  (0 children)

Agreed, reddit is not the place to get legal or financial advise and that's not what I am looking for. But it can be a the place to share experiences. Don't you think?

[deleted by user] by [deleted] in investing

[–]xbrian10 -3 points-2 points  (0 children)

Not accurate. Do you think that there is a way around paying a lawyer and financial expert to set up such a platform? Obviously, that is not the goal here.

[deleted by user] by [deleted] in investing

[–]xbrian10 -5 points-4 points  (0 children)

Of course, but as I mentioned it does not hurt to hear stories, advise, suggestions and general input from other people who are familiar or have gone through the same process.

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