New player in the freight-bill factoring field emerges

Express Freight Finance, an independent factoring company specializing in transportation clients, has recently launched its freight-bill factoring services for truck fleets, owner-operators, and freight brokers nation-wide.

According to Dan Hadley, chief executive officer of Express Freight Finance, there is a need for this service because small carriers and brokers would rather focus on moving freight and growing their business than managing receivables and collections.

“Because we’re 100% dedicated to trucking and understand the realities of the business, we have committed resources that allow us to deliver a funding decision in minutes and cash as quickly as that day,” he adds.

Express Freight Finance is launching with an initial capital base of more than $30 million and is backed by Adelphi Capital, a merchant bank with a strong track record of equity investment in factoring and other financial services for transportation companies in the United States. Adelphi and its affiliates were previously the founding investors in two successful freight-bill factoring companies.

Hadley is a seasoned credit and operations executive with significant experience managing factoring portfolios in the trucking sector. He was most recently the senior portfolio manager for Summit Financial Resources, and prior to that was a portfolio manager at Transportation Alliance Bank (TAB).

Brent Gottlieb, executive vice-president of sales and marketing, has over 17 years of experience in sales management and new business development in the transportation factoring market, including at Phoenix Capital, DB Squared, and Olympic Credit Fund.

In an interview with LM, Gottlieb made the following observations:

“Freight bill factoring is the exchange of creditworthy freight invoices for immediate cash. Instead of waiting for the shipper to pay for the delivered load, you get paid by the factor typically on the same day you present the freight bill,” he says.

Gottlieb further notes that in order for a freight bill to be eligible for factoring, it must be billed to a creditworthy customer; the load has to be tendered (issued) to the factoring client; and the load must be completed without any problems or offsets.

“As long as you run under your own motor carrier authority, and have the loads tendered directly to your company, you should be eligible to factor your freight bills,” he says.

As a new enterprise, Express Freight Finance is competing with scores of more established factoring companies, admits Gottlieb. He also notes that the industry suffers from “a black eye” due to predatory lenders.

“But we see an opportunity to build our business through referrals and our network of industry contacts,” he says. “We will take on a one-truck operator as a client or truckers with as many as 50 rigs in their fleet.”

The company has a credit and operations platform that provides underwriting, “decisioning,” and documentation of new client relationships; client service and support; on-line connectivity and account transparency; and daily funding transactions. A dedicated account manager and online tools enable users to to verify available funding, submit invoices, and run credit checks.

Express Freight Finance requires no long-term contracts, up-front costs, or fees to terminate the factoring agreement. “We view our relationship with clients as a partnership,” Hadley said. “We’re committed to helping them leverage the value of their invoices into working capital today, when they need it, at a competitive rate.”