Mark Saggin is founder of The Coffee Club franchise at the Stud Park shopping centre in the Melbourne suburb of Rowville. He opened in December 2012, after operating The Coffee Club and Subway franchises in other locations around Melbourne.
He launched the Stud Park Coffee Club with a $40,000 loan from Australian online small business lender Prospa, and recently borrowed another $24,000 to help him maximise opportunities through the busy holiday period.
“Getting fast and easy access to funding, right when I needed it has enabled me to maintain staffing levels and increase my inventory to cater for the busy periods over Christmas and New Year,” says Mr Saggin. “It has been a horror year for retail in Australia, and it has been important for us to keep all our staff and all our shifts – that’s an important part of being a good employer.”
Prospa is an Australian online lender that specialises in funding small businesses. Founded in 2011, it uses a proprietary technology platform it has developed itself to analyse over 400 data points about a prospective business, based on factors like cashflow, social media and business growth.
Small businesses can apply online for loans up to $250,000 using the online application form, get a fast response and in many cases receive the funding in under 24 hours.
Mr Saggin says that dealing with Prospa has been a breath of fresh air. “I’ve been 28 years in food retailing, and it’s go-go-go all the time. I have dealt with banks and finance companies, and I have dealt with Prospa. The big difference is how much easier they are to deal with. They follow up – I found that with banks I could never get an answer and I was always dealing with different people.
“Banks change business managers all the time and I felt like I had to tell my story over and over again. Prospa assigns a case manager, and even if that person changes they have all the details and they are convenient to deal with. It’s fantastic.
“You have busy periods and you have quiet periods, and you often need access to finance to even it all out. Whether it’s school holidays, Easter, Christmas, they always seem to understand where you are.”
Mr Saggin started using Prospa when he heard of them through a fellow franchisee. “I did some research late at night after the kids had gone to bed, and found that they had helped a lot of small businesses just like mine. I got in touch, and haven’t looked back.”
Prospa has now made over $100 million in loans to Australian small businesses. It has a led a revolution in business lending in Australia, using online technology to disrupt the traditional lending market. Mr Saggin believes the new model is here to stay. “It is based on technology, but like everything is business it is ultimately about relationships,” he says. “Prospa understands my business, and they are very easy to deal with. I know that if I have a problem, they will work with me to solve it.
“That’s a refreshing change.”