Client Spotlight: Kickfurther
April 29, 2020
Money, money, money. There never seems to be enough of it. Especially now. As businesses everywhere shut their doors in response to COVID-19, both health and money remain primary concerns.
Funding has long been one of the standard concerns for many of CPG’s clients. Specifically, not having enough money to buy inventory. If there is one thing companies hate, it is having hot products and running out of stock.
In this Client Spotlight, we introduce a company that has paved the way for a new and innovative solution to the challenges of funding inventory for five years now: Kickfurther. This young company’s dramatic growth proves that there are infinite brands and products that could benefit from Kickfurther’s unique inventory-funding platform.
Funding inventory is a particularly challenging issue for companies sourcing from China for several reasons:
(1) Buying directly usually entails an up-front payment.
(2) Cash is “frozen” until products are received and sold, thus the available cash flow becomes strained.
(3) Banks are normally conservative and will only give a limited credit line, stalling potential growth.
What’s a company to do? While there are accounts receivable factoring, purchase order funding, and other financing sources, these options tend to be very expensive and offer inflexible terms.
Kickfurther’s solution is different. It provides companies with a friendly source of money to fund inventory at a low cost using an open and transparent platform that partners with growing brands to fund business growth.
Sound too good to be true? Let me explain. Kickfurther’s platform has two sides that benefit by working together:
(1) Brands: Companies that need funding for their inventory.
(2) Backers: Site users or individuals looking to fund growing brands and earn a small percentage of profit as inventory sells.
Kickfurther calls its transactions between the two sides “Co-Ops,” short for consignment opportunities. Here, a Brand funds an inventory order or refinances existing inventory with Backers, who earn a return as that inventory later sells.
How Kickfurther Helps its Brands
Nearly any company selling a product can seek funding on Kickfurther. Most of Kickfurther’s brands are young or rapidly growing companies. The platform allows these companies to:
(1) Raise funds for their inventory quickly and repeatedly.
(2) Keep their costs lower than alternatives.
(3) Make payments after the inventory sells, not before.
Once Brands are vetted by Kickfurther, it’s the Backers, not big banks who fund the inventory, offering the benefit of faster funding than many traditional lenders can offer. Also, the more often a Brand uses the platform, the more trust they gain from Backers and the cheaper the funding gets.
Example: Tame the Beast, a men’s personal care brand, funded an initial Co-Op of $27,000 for 1.7% profit per month. They recently launched their 14th Co-Op for $303,000 and offered backers 1.2% profit—a 30% reduction!
How Kickfurther Backers Support Growing Brands
Backers have a great opportunity to make money while also helping companies grow.
(1) For as little as $20, Backers can purchase inventory through Kickfurther’s online funding platform.
(2) When Backers cycle their money from one Co-Op into another, they can profit at a rate of over 14% per year.
Given these challenging times, we’re happy to share this piece of good news. There is now a solution for companies that might previously have been forced to forsake greater profits, or bigger market share, because they did not have enough funding on hand to produce the inventory they knew they could sell.
How do you deal with funding for inventory? Does this platform make sense to you?
By Laura Dow