A mobile phone network operator is ringing the changes after a Coventry firm helped secure £600,000 of investment to assist its growth.
Shebang, which operates a mobile phone network from its Daventry base, has just secured the six-figure investment through the ThinCats peer-to-peer loan network.
The agreement with ThinCats came to fruition after Ludgate Finance, which has offices in Coventry, were approached by Shebang.
The company operates in a niche market by specialising in providing mobile phone contracts to people with low credit scores.
Shebang, which provides sim-only tariffs as well as those including handsets, has used the ThinCats funding to support a restructure which is forecast to lead to the firm more than trebling its current 3,500 customer base over the next 12 months.
The company also has the means to deliver ‘white label’ solutions to corporate and large organisations along with specialised web-development capabilities.
After being weighed down by the red-tape and fees incurred through its bank following the restructure, Shebang sought an alternative source of finance.
The agreement with ThinCats came to fruition after Shebang had sought advice from Paul Stokes of Birmingham-based Partner Commercial Finance. Paul introduced the idea of peer-to-peer funding as an alternative to more traditional routes to finance and then approached Ludgate Finance, which also has offices in Coventry, Wolverhampton and Birmingham.
Duncan Hay, managing director of Shebang, said: “The difference with ThinCats compared to the banking sector was that there was a desire to get the deal done.
“When dealing with the banks there was always a sense that they would try to do everything they could to avoid providing financial support.
“In real terms, when you take into account advisor fees, overdraft and other bank charges, the deal agreed with ThinCats actually provides us with a better cost of borrowing.
“The funding has allowed us to concentrate on developing the business rather than dealing with the banks.
“Shebang offers unique propositions and a different sales cycle which allows us to manage the risk of operating in this sector in a way that major networks cannot
“It also gives our customers access to great value tariffs from which they are otherwise excluded.”
David Grocott, from Ludgate Finance, said he was delighted to have helped secure financial support for the business.
“Funding for SMEs through traditional means is becoming increasingly inaccessible and, as we saw in this case, increasingly unaffordable due to both the financial and time constraints involved,” he said.
“Peer-to-peer loan networks, such as ThinCats, are able to provide a fast, efficient and effective solution to meet the funding gap created by the banks.
“With an estimated 40 per cent of people unable to secure a mobile phone due to their credit score, Shebang is filling a gap in the mobile phone network.
“The company’s plans in relation to the corporate phone market are also very exciting and we are sure they will go on to be a tremendous success.”
Kevin Caley, managing director of ThinCats, said: “We are delighted to support growing businesses and provide funding that banks are not supplying.
“Shebang’s story sends a strong message to other SMEs – for creditworthy businesses there are funds to lend and ThinCats is open for their funding needs.”
