The MCA industry has undergone several changes in recent years, and the pandemic seems to be in the past. Still, with its side effects, such as staggering inflation worldwide and a recession looming, many funders are concerned about how to navigate these turbulent waters.
This post will reveal how to survive the recession and prepare your business for the new changes.
Predict the future? Can we do something about it?
The MCA ecosystem has changed dramatically. There have been several rulings surrounding the Industry, and the product itself has evolved in trying to accommodate the environmental changes. Understandably, funders are looking to be prepared for the high-interest rate – high inflation scenario.
Although in the Economic theory, certain known behaviors under these conditions are to be expected, only with a proper scenario tracking tool will you be able to understand what is working and what is not, and – most important – react swiftly to changes. As analysts, we know to formulate and test the proper Hypothesis to achieve the objective at hand better and faster.
We deep dive into your portfolio to establish the coveted single source of truth, derive financials, establish controller metrics and identify underlying trends and patterns to give you tight control over your portfolio and your decision-making. Dissemination of information to stakeholders is then completely coherent and insightful for all decision-makers, with a deal-level detail or the 10,000 ft view, as needed.
High Inflation? Can we do something about it?
Keep your costs at bay, and become a lean organization by outsourcing, thus freeing up internal resources while obtaining the benefits of the expertise and skill set of a company with extensive experience in the Industry.
What will happen in the Industry in 2023
The government will probably continue raising interest rates to lower inflation, restricting easy access to cash. The MCA option will become increasingly attractive to legitimate merchants caught in a credit crunch.
But it would help if you were agile and flexible to measure and detect failures and opportunities and change accordingly.
With many years of experience in analytics and the MCA business, we went beyond pretty pictures and have developed insightful forward and backward looking KPI’s.
Together with Machine Learning models, these indicators improve the ability to pick better deals, forecast default levels and accurately estimate the amount of RTR that contracts and vintages will ultimately collect.
These models also provide constant feedback to your decision-making; therefore, they help you adapt faster and better to environmental changes.
Similar models can also improve operational processes, allowing for scaling with confidence and reducing risk. Our method constantly incorporates freshly produced data, so it adjusts automatically, always providing the best possible real-time information and improving the chances of success.