The Silicon Review
When an organization is looking to access capital, it typically goes to a bank to borrow money. Debt can be in the form of a loan, or the company can reach out to an investment bank to issue debt securities through capital markets, mostly in the form of bonds. Investment banks provide numerous debt services – including hedging, underwriting, and lending, and end up making more money from these services. This makes it impossible for the investment banks to provide impartial advice to the companies on the appropriate funding type. This is where financial advisory firms come into play. The advisory firms’ functions are not just limited to advising companies on the best and cheapest way to raise finance for a company. They also manage the entire process and reach out to several types of commercial lenders to negotiate on the clients’ behalf to acquire the necessary funds. Most enterprises are dependent on debt from financial institutions and banks for their working capital and long term needs. With their diligent advice, debt advisors can help companies raise capital even during difficult situations. The debt advisors are known for creating the right competitive environment to stimulate financial partners to offer the best terms for debt.
The current global debt market is rapidly changing, and it is filled with uncertainties. Companies looking for unbiased advice and stellar execution resources can depend on the RainStar Capital Group. The company is a national debt advisory firm based in Grand Rapids, Michigan, that provides advisory debt capital
Rainstar Capital Group excels in providing business, asset based lending, equipment and commercial real estate financing through its platform of 250 lenders. Product lines include Unsecured Lines of Credit, Revenue Based Lines of Credit, Revenue Based Advance, Merchant Cash Advance, Business Lines of Credit, Inventory Financing, Purchase Order Financing, Equipment Leasing, Accounts Receivables Factoring, CMBS loans, Agency loans, Bridge Financing, Hard Money and Commercial Contractor Credit Lines. With well-equipped insights into your financial position, RainStar Capital Group works with you to ensure the best possible financial outcomes. Achieving the optimal funding structure for your business is the key to success.
In conversation with Kurt Nederveld, Founder and CEO of Rainstar Capital Group
Q. Whom do you give credit for your business success? Why?
As a Christian, I believe the Lord gives the firm and me the blessings we have today. Along with my faith, I have been blessed with a strong work ethic taught to me by my father. I also have intentionally sought out and been mentored by many strong Christian and non-Christian businessmen. Finally, the quality of the individuals on our team, our lenders, and our streamline process is what drives our success.
Q. What is the current market landscape for companies seeking growth debt financing? How has the pandemic affected your business?
The Coronavirus pandemic taught us many valuable lessons about how to pivot strategically, and we are thankful that our lending platform does not limit us to an industry or a commercial real estate property type perspective. At the same time, certain industries like gyms, retail, and restaurants were greatly affected as the lenders pulled back considerably. We were able to strategically pivot to helping companies in the manufacturing, supply, distributing, and wholesale markets access growth debt financing to keep up with demand. Toilet paper and PPE- personal protective equipment companies saw massive demand for their products, and we were able to quickly align our marketing to target these types of companies and help them with scale capital.
Q. How can companies utilize growth debt capital versus private equity?
The main benefit of debt is that you keep 100% control of your equity, and this becomes a very valuable thing if you scale the company and sell in a few years for a strong liquidity event. Companies that can handle the debt service can strategically save their equity and utilize alternative capital market products above and beyond their local banks' debt products. Over the years, we have taught clients how to utilize 2nd lien products and proactively leverage up their firm's cash flow, credit, equipment, commercial real estate, inventory, purchase orders, and accounts receivables to scale up their company revenues.
Q. What are the distinct advantages that the alternative capital market lenders provide to scaling businesses?
The ability to save equity, not have other operational partners' input in the business, and access second lien products above the bank products the client already has. Along with that, banks are very conservative lenders, and alternative credit providers will finance clients that maybe have credit issues, property occupancy issues, or IRS tax issues.
Q. How can companies learn about how to leverage alternative debt products?
Here at Rainstar, we have developed many articles, our own magazine- "Rainstar Capital Group's Ultimate Lending Guide," and over seven hundred videos that clients can read and watch across the internet. Many of our videos are webinars that focus on strategies on how to use alternative debt lenders to grow their business and commercial real estate portfolios. For example, in commercial real estate, we have strategies not to raise equity for the sponsors' contribution to acquisition but leverage their credit or other business assets to extract liquidity to replace their equity contribution.
Q. What are the eligibility criteria that a business has to fulfill to access growth debt capital?
The nice thing about the alternative capital markets is that they overlook issues that banks would have major problems with. We have lenders that will finance clients with a 400 credit score, negative cash flow on commercial real estate properties, and in the equipment space, one of our more popular programs is our no credit check, no income check equipment financing. These creative programs allow clients to grow while they fix the issues of credit, cash flow, or property issues. Along with those alternative products we also provide the best “A paper” solutions with rates that either beat or compete with bank products. A big differentiator of our “A paper” products though is that banks require full recourse and we have products that are non-recourse. This is a big deal especially in the event of a major issue where a borrower needs to go into default. Many commercial real estate investors and business owners are looking at things differently now due to Coronavirus!
Q. Do you have skilled individuals who can help you manage your service standards?
Yes we have been blessed with a highly accomplished team. Our team has collectively done of one billion in transactions over all of our careers. A few of our team members are former President of banks, middle market, C/I bankers and others have worked for direct lenders as a Vice President of Business Development. Our people drive our success here at Rainstar Capital Group.
Q. How do you market your services?
Many of our clients come from commercial bankers that cannot assist them. We market heavily on LinkedIn and you can find our videos YouTube and several other platforms online. Along with that, we get many referrals to clients from our center of influence market that are part of the many associations we belong to, such as the Association of Corporate Growth, Turnaround Management, Secured Finance Network, and many chambers of commerce in different markets.
Q. Do you have any exciting product lines for 2020 ready to be launched?
Yes, we are actively doing deals in the inventory lines of credit, equipment space, new construction commercial real estate lending, refinancing maturing commercial real estate mortgages, and providing scale capital for high growth companies fueled by the COVID epidemic. Multifamily and industrial properties are of major interest for purchase, new construction, or refinance. Any company with accounts receivables and purchase orders that are ready to grow their revenues and currently do one million-plus in annual revenue a year.
Meet the leader behind the success of Rainstar Capital Group
Mr. Nederveld is the Founder and CEO of Rainstar Capital Group and Rainstar Marketing. He is a serial entrepreneur, investor, debt adviser and highly sought after consultant in the debt capital markets. Mr. Nederveld has personally advised over 100 marketing clients that are Fund Managers, Debt Funds, Investment Bankers, Fintech lenders and Specialty Finance firms. He manages multiple investment firms that focus on niche investments and operates a robust debt advisory firm assisting clients with corporate finance, commercial real estate, small business and equipment financing needs. At the age of 26 Mr. Nederveld was diagnosed with cancer and is blessed to be cancer free today. Mr. Nederveld graduated from Calvin College based in Grand Rapids, Michigan with a B.A. in Business. He is active in leadership roles in his church, Gideon’s International, Truth at Work, Institute of Reformed Biblical Counseling and in his role as a husband and father. He enjoys reading, playing basketball, tennis, jet skiing and spending time with his family.