Author: Ryan Moran, founder of and host of the One Percent podcast


Our founder and CEO Ricardo Peró was interviewed by Ryan Moran, founder of exists to dispel the theory that the government is the best solution to problems, and it instead strives to empower individuals to take personal responsibility for their actions. They promote the ideals of entrepreneurship, small government, high achievement, and solving global problems through personal responsibility and profit.

Check out the full interview below:


How to get funding for your E-Commerce Business

Most online brands launch with just a few thousand dollars (or less). With that, they gather momentum and get on
track for hitting that seven-figure business. You’re selling product left and right, and it’s all humming along like
Then suddenly, it’s not. You’re growing so fast you can hardly keep up with yourself. In fact, as you look at your
books, it strikes you. You need more capital.
The challenge isn’t so much the accessing capital part. It’s the fact that traditional banks and lenders rely on
traditional credit scores. They don’t necessarily understand how e-commerce works. Nor are they
particularly accommodating when it comes to the timetables on which we operate. That’s not usually a
problem for brick and mortar shops. But for e-commerce brands, matters can get complicated.
We spoke with Ricardo Pero, founder of SellersFunding, to find out how his business helps brands get the capital they need.

Merging Metrics, Moving Money

When Ricardo started this business in 2016, he didn’t focus immediately on helping clients gain access to more
capital. Instead, he created a credit score model that would allow capital lenders to underwrite the risk of the
sellers. The solution was simple: Create tools that enable investors to analyze e-commerce sellers. They assess the performance of merchants on Amazon, Shopify, and other platforms. Additionally, the company created a framework that could link lenders with online merchants.

As often happens, this company is continually evolving. Seeing an influx of demand from foreign sellers led to the
upcoming launch of a foreign exchange platform. US based sellers who sell abroad can now benefit from
combined funding and credit lines with their sales. Now they can merge their sales in different markets. This not
only takes US sales into consideration but also international, bringing them all together in one cash flow model.

This same concept also works for foreign companies selling here in the United States. There are many
examples of Canadian and European companies seeking cash advance solutions to keep up with their rates of
growth. Their biggest marketplace is (US). But these sellers do not have sources for the necessary
funding in their countries of origin.

Bank Loans? How 2003

Getting funding is a big enough challenge when you have a business banks understand. Even though ecommerce
has been around for nearly two decades, traditional lenders don’t always get it. Underwriters get nervous when they see our numbers.

What we’re doing must seem completely reckless to them. This scenario gets even dicier for overseas
merchants. These sellers face local banking industries that could be even less sophisticated.

Of course, there are other funding sources available. Even Amazon itself issues loan offers to some of its
merchants. On the surface, some of these offers look enticing. But a closer look at the terms reveals a problem.
Their cash advances are too short-term. They’ll provide capital for the next payment cycle and nothing more.
By comparison, SellersFunding uses a sales forecast that projects up to twelve months into the future. Their
proprietary scoring system makes longer-term loans workable.

This long-term coverage and flexibility creates opportunities. Sellers sourcing goods outside the United States need to pay foreign manufacturers up-front. Between the time required for shipping and making products available for sale, it can take 100 days before sellers receive their first payment. Having a forecast that extends far enough to encompass all this allows more accurate and thorough projections.

Using Their Money to Make More Money

Many entrepreneurs shy away from any kind of borrowing. That stance can be short-sighted and often results in a cashstrapped lifestyle with no room to invest in opportunities that might bring exponential growth.

Here’s an example that illustrates why using other people’s money (OPM) to buy inventory yields a better return on investment than funding it yourself:

If you take a $100,000 loan to fund your inventory, you will likely pay between 5-10% in interest. That’s a total cost of money of $5,000 — $10,000 (and you pay it out of future profit!). Instead of paying $100,000 for inventory, you only pay $10,000, because you are utilizing debt.
Initial cost before utilizing outside capital: $100,000
Cost after utilizing outside capital: $10,000

If you would typically profit $200,000 from selling your purchase order, than you would normally stand to see a 200% ROI. But since you only spent $10,000 (the interest paid on the debt), your ROI is now 2,000%!
ROI using your own money: 200%
ROI using someone else’s money: 2,000%!

More importantly, you have freed up $90,000 in capital that you can put into other multipliers. That means that you finally have the capital to launch that next product that you have been considering. Or, FINALLY building the
list that you have been putting off. Or maybe, you can afford to hire a copywriter to put a funnel together for your business. Or (gasp!), maybe you even can take a larger-than-normal distribution from your company, so
that you can finally enjoy some profits or go on a much needed vacation, where you will get creative ideas again.

As long as the sales of your product are somewhat predictable, it makes sense to do this.

“There are other options for merchants in need of capital — Amazon, for one, offers loans to highquality sellers,” says Ricardo.

“Still, our clients receive personalized treatment. Once a seller signs on with us, we monitor their sales performance. We work with them as needed if their growth rate changes.”

“This flexibility also extends to alternative sources for funding. That’s particularly useful for clients who want
to expand beyond Amazon’s platform.”

Although Amazon Lending can get the funding some sellers need, the service is overall very impersonal and
not always easy to access. Sellers can’t apply, as Amazon needs to invite you. Beyond that, sellers do not get to
negotiate, ask for renewals, or increase the amount of capital. To make matters worse, when Amazon lends, they own your store, receivables, and inventory. If you don’t also rely on alternative funding sources, an issue with Amazon could lead to losing everything.

It’s advantageous, then, to have the flexibility needed to diversify away from that marketplace. It’s also a good
idea to have a lender who understands your needs and has invested the resources to deliver on them. While many online lenders serve small businesses, that’s a broad category. SellersFunding’s focus is on e-commerce. “Our vision is becoming the leader in that space, lending based on metrics that make sense for those e-comm sellers. When your lender knows how much you need, and when, it becomes a lot easier to keep growing and earning more,” Ricardo said.

Need Funding?

We asked Ricardo what a brand owner needs to work with SellersFunding. He said, “We aren’t an exclusive club. We like to partner with white label merchants and smaller sellers as well. We understand the need for a longterm
partner, someone you can partner up with and grow alongside. We look for sellers with consistent sales and at least six months of operation history.”

How Can a Seller Get Started?

Anyone interested can apply at, a process that takes about five minutes.

You’ll grant access via the Amazon API. Once the analysis finishes, the system generates a report. The
amount of time this takes depends on how long the seller’s history is. A more extensive amount of information requires more processing time. Once they’ve had time to go over the data internally, they typically make an offer within a day.

If the seller accepts, then it’s a simple matter of exchanging some documents. This often happens within just a couple of days. With traditional banks, it could take three to four months. One of Ricardo’s team members used to do small business lending for Chase, still says he’s shocked to see how fast they can fund. He says the difference between the two application processes is like the difference between wine and water. The clients whose lives get
changed when they see the possibilities now open to them feel the same way.