How fintech Grapple poached rising NAB tech lead

“I had noticed in my career that banks and larger lenders offer outdated software that ultimately slow Aussie SMEs down,” he said.

“TTY or ‘Time to Yes’ at Grapple is in minutes, not weeks, and the opportunity to provide funding in real time excites me.”

Grapple was founded by former EY auditor Steve Dawson who saw invoice financing taking off in the UK, but believed it was an underserved part of the market in Australia.

The company offers three invoice financing products, which let businesses receive full payment, 90 per cent of their outstanding invoices, or an ongoing line of credit against their sales ledger for a set interest rate. It also offers a buy now, pay later supplier finance arrangement.

Having built the platform in 2016 and 2017, he decided to go into the peer-to-peer lending space to prove out the functionality of the lending platform. With that milestone achieved, Grapple is now moving into “lending-as-a-service” and signing up the big banks and other lenders as subscribers.

The fintech has closed a fresh $ 6.5 million funding round to support the transition, supported by high net worth investors including Telstra chairman John Mullen, Washington H. Soul Pattinson’s Robert Milner and US-based Morgan Stanley managing director Adam Merino.

Grapple has established a unit trust called Altvest for sophisticated investors to provide the funds to Grapple to loan to SMEs. In turn, investors receive a target yield between 7 per cent to 8.5 per cent per annum after fees.

To date, Grapple has written $ 70 million of loans.

Grapple CEO Steve Dawson started the business in 2017.

“There’s a digital revolution happening in SME lending,” Mr Dawson said.

“We’ve proven out the technology ourselves, and now we’re looking at licensing opportunities. We’re moving the model into more of lend-tech play to enable the bigger guys who have the large distribution to use the technology and have a competitive edge.

“We’re also building the capability for smaller lenders and banks to have a plug-and-play solution, so we’ll have licensing deals, and also full-service agreements where we will manage the clients and technology for them.”

Its platform has a proprietary risk score model built-in, providing financial ratio analysis, ledger analysis and a credit score. It also has risk alerts and the capacity to talk to credit agencies’ platforms, automated anti-money laundering, know your customer approval processes and document management features.

Having just pivoted to offering its technology as a service, Grapple is yet to secure any enterprise clients, but Mr Dawson said it was in discussions with a range of financial institutions.

“We’ve used technology to automate and simplify what historically has been a laborious process. We’re also using data and smart integrations to make decisions more accurately than ever before which has significantly reduced the risk for our partners and most importantly our customers, ”he said.

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