Serial entrepreneur Robert Frohwein, who founded MediaWheel and LAVA Group, has started a new online venture called Kabbage. With $2 million in angel money and an upcoming investment round expecting to bring in $5-$10 million, this new venture is ready to start giving small e-commerce businesses the capital they need to move to the next level.
Focusing on online retail outlets, namely eBay sellers, Kabbage is an instant loan application and approval platform for e-commerce entrepreneurs.
The site is currently in closed beta, but will soon be opening to public beta. It works simply and automatically, giving eBay sellers a chance at a loan when banks and other institutions would probably not even talk to them.
Most who have sold on eBay seriously know that getting business cred is difficult. As soon as you mention that your primary outlet is online auctions, the crickets start chirping and you can see their eyes glaze over. Even with receipts in hand to prove blockbuster sales, a bank is likely not interested in you. Well, Kabbage is.
The signup process is painless and quick, requiring just a few pieces of information about you and your e-signature giving Kabbage one-time access to your eBay profile and records. The site then pulls all of your sales history and other vitals, does some number crunching based on the size of the loan you’re asking for and the purpose to which it will be put, and gives you some options.
Terms will depend on a number of variables, of course, but are reasonable at today’s business loan rates. Once you accept the terms, the money you’ve asked for is deposited in your PayPal account. You can then use it as you wish, making your return installments as required.
If you have all of your ducks in a row, you can sign up in about ten to fifteen minutes and get an answer.
Definitely a slick and much-needed application for today’s recession-ridden landscape of online sales.