One couple searched unsuccessfully for six months to secure a loan. Then, 14 days after using a new online marketplace, Ted and Cindy Ferkenhoff had an offer.
The Ferkenhoffs, who needed a loan to open an AlphaGraphics franchise in Flagstaff, weren’t expecting such a quick response.
“With the lending market being pretty shaken up … it was a little surprising that they contacted us and did so, so quickly,” Ted Ferkenhoff said.
It was Mark Danford, executive vice president of the loan-consulting firm FranFund, who introduced the Ferkenhoffs’ loan request to BoeFly, the online marketplace. Danford, who has used BoeFly since its inception on March 17, 2010, decided that BoeFly was the most efficient way to connect the Ferkenhoffs to an appropriate lender.
BoeFly, which is headquartered in New York City, works much like an online dating service, but instead it matches lenders with borrowers.
“We see websites and technology efficiently matching up a whole world of people,” said Michael Rozman, executive vice president of BoeFly. “Matching up boys and girls looking for dates, down to travel and consumer mortgages. It became apparent to us that small business lending would greatly benefit from a service like ours.”
In an online marketplace setting, borrowers can submit their financing request and have almost 500 lenders see it immediately, Rozman said.
The speed at which lenders and borrowers can see results is what inspired the name BoeFly.
BOE stands for business opportunity exchange, Rozman said.
“It’s an exchange that allows businesses to connect more efficiently, and the idea of adding on the fly is a mix of how quickly transactions can fly through the system with a little bit of whimsy behind it,” he added.
It also helps professionals like Danford by saving them time. BoeFly allows him to connect “almost instantaneously” with lenders.
“It’s a night and day difference,” Rozman said.
Transactions with BoeFly are quick, but the main goal is to also make sure the appropriate lenders see the loan requests. Lenders range from small to large institutions all over the country, with six small community banks in Arizona using BoeFly. On average, a submitted loan request will see six to 12 loan offers through BoeFly, Rozman said.
Not only is BoeFly more efficient than the one-by-one approach of lending, but it can also help franchisees and small businesses owners who aren’t familiar with the lending process.
Rozman said he wants to see the word spread about BoeFly, so more small businesses can “leverage BoeFly to end up with business loans.”
The Ferkenhoffs are doing their part to inform others about their success with BoeFly.
“We have passed that around and, of course, given the feedback to AlphaGraphics,” Ferkenhoff said. “Obviously they’re looking for the best method to get new franchising funded.”
With $1.2 billion in transactions since its start, Rozman said he sees BoeFly continuing to grow as people recognize the ease of the online process.
“More and more banks realize that their clients are turning to the Web to be able to more efficiently connect with lenders,” Rozman said. “Banks historically aren’t the earliest adopters of technology, but they do when their clients lead them in that direction.”
The Ferkenhoffs are set to open their AlphaGraphics this month.