Yesterday I attended the ‘Between the Towers‘ event in Frankfurt, which is organized by Mainincubator, the Commerzbank backed fntech incubator. The event format features a keynote speaker, followed by 4 startups delivering 7 minute pitches. Personally I found CRX Markets the most interesting concept. Pitched by co-founder Moritz von der Linden, the company, which is close to launch, offers clear advantages to all parties involved in its model.
Here is a summary of how CRX Markets will function:
CRX Markets is an easy-to-use exchange platform for corporate receivables that provides access to cheaper, more flexible and less bank dependent financing while offering Investors attractive returns.
CRX Markets provides cheaper, more flexible and transparent financing for small and medium-sized companies. CRX Markets is challenging the current status quo when it comes to short-term corporate funding, which is currently dominated by Banks and factoring providers. For SMEs, this means expensive and inflexible financing solutions in a bank-dependent environment with few options to manage their own working capital effectively.
The Buyer is benefiting from greater safety and stability for his supply chain, while simultaneously securing other advantages, such as the opportunity to increase his contractual payment terms (DPOs). This allows the Buyer to release tied-up liquidity and greatly improve its working capital management. By gaining access to this additional capital, the Buyer has the opportunity to invest in his own payables or reduce other financial liabilities, thus significantly strengthening his own balance sheet.
Meanwhile, the Supplier has the opportunity to benefit from a closer relationship with its Buyer, while at the same time benefitting from the cheaper financing alternative that the Buyer offers. The Supplier is given the ability to decide when and how much financing is actually required and is not tied into strict refinancing programs. By participating in the program, the Supplier also has the opportunity to sharply reduce the remaining maturity of its invoices (DSOs). In doing so, he can achieve higher profitability and growth.
The Capital Market Investors and the participating Banks also benefit greatly from using the CRX Markets SCF suites. An increase in customer involvement and the ability to improve and create customer relationships allow the Banks to reposition themselves in a situation where their reputation and standing has been on the wane. Additionally, both Banks and Capital Investors benefit from the unique approach and the attractive pricing of the securities traded, which are rare in today’s short-term markets.
P.S.: On the event, I had the possibility to try out a virtual reality headset. I found the immersion pretty impressive. Some of the small talk touched possible use-cases of the technology for banks, e.g. virtual bank branches.