Online advertising companies notoriously pay their customers on a 60 day cycle. Considering another set of business priorities, the companies typically aren’t able to release such large amounts of cash sooner.
The advertising technology ecosystem is such that even this 60 day cycle can regularly turn into 120 days. Without enough money coming in, companies expecting pay aren’t always in a position to do add buy-ins or make other necessary purchases in order grow their business.
That’s where Jed Simon’s FastPay steps in by offering much needed credit to digital media companies. Sometimes, FastPay is able to do this in a little as 24 hours. Offering credit lines of up to $5 million, the Los Angeles based company has been reworking its strategy within the last year.
Founder and CEO Jed Simon explains “One of the common themes I’d heard from a variety of business was that businesses were growing, they’re in perpetual fundraising mode, and there was a pain point being caused by the long terms created by brand advertisers. Businesses, whether they were ad networks, affiliate networks, publishers or production studios, they had their costs to contend with on a daily basis, but then they had to wait four months to get paid from their advertisers and these big brands.”
A New Round of Funding
Recently granted $25 million in funding, Simon sees FastPay as the “anti-bank.” He explains, “Most banks look at our clients and call them un-financeable. To them, tech and media businesses are too esoteric to evaluate. We speak our clients’ language and see them as fantastic financing candidates.”
“We really are providing money that is already owed. Our client sells us an invoice and if the brand pays, we charge a small fee and then everyone’s even.” says Simon.
Eligible startups must produce at least $50,000 in revenue and must be approved with the help of a algorithm based computer application.
Help Is On The Way
“FastPay has been a lifesaver for us, literally. We feel very fortunate to have a partner that understands our business and is willing to underwrite and accelerate our growth.” said David Segura of Giant Media. “Our entire business revolve around executing campaigns on behalf of big brands which have extended payment cycles. FastPay has enabled us to take on more business and grow our team without worrying about cash flow, giving us the freedom and flexibility to focus on top line growth.”
Company profit doesn’t guarantee an ideal position. Simon adds, “Just because a company is profitable, doesn’t mean a company is generating enough cash. Even when companies are profitable and growing, they actually require even more cash.”
For Simon, Fastpay makes perfect sense. Providing companies necessary capital to invest, grow, and make more money was a piece of the puzzle that he felt was missing and one that he felt that he could resolve.
Today, this is the case with FastPay provided loans between $100,00 and $3 million dollars on average.