Purpose Financial LP, the parent company of Purpose Investments and other affiliates, has agreed to buy Thinking Capital Financial Corp, a Montréal-based provider of small business loans and funding solutions online. No financial terms were released; however, the Globe and Mail said the cash-and-securities deal is valued at over $200 million. Purpose Financial, a Toronto-based financial services firm led by CEO Som Seif, said the buy will create an innovative financial services platform with a “significant balance sheet strength, strong financial backing, and a diversified funding model.” TorQuest Partners, which has backed Thinking Capital since 2014, will retain a stake in the business.
Photo: Som Seif, CEO of Purpose Financial LP.
Purpose Financial to Acquire Thinking Capital
Transaction brings together Thinking Capital with Purpose Financial’s Investments and Technology businesses to create an innovative financial services platform with financial strength and proven leadership
TORONTO – March 9, 2018 – Purpose Financial LP (“Purpose Financial”), parent company to Purpose Investments, Purpose Advisor Solutions, and Purpose Innovation Labs, today announced that it is acquiring Thinking Capital Financial Corporation (“Thinking Capital”), Canada’s leading fintech lender to small business, for a combination of cash and securities (the “Transaction”). The Transaction builds on Purpose Financial’s objective of driving innovation in financial services and represents a key milestone in its growth strategy.
The combination of Thinking Capital and Purpose Financial will create a business with significant balance sheet strength, strong financial backing, and a diversified funding model. This model will fuel Thinking Capital’s originations growth through improved access to capital at a reduced cost. In addition, the combination of direct originations with asset management offers the potential to create unique investment products.
“Purpose Financial has an unrelenting focus on building innovative, technology-driven financial solutions,” said Som Seif, Chief Executive Officer of Purpose Financial. “Thinking Capital is a clear leader in the small- to medium-sized (SME) business lending space, with credit adjudication technology and presence that are unmatched in the Canadian market. This acquisition brings together leading origination, asset management, and technology platforms as a unified entity, and enables us to bolster our product capabilities and optimize the technology, distribution, and funding model of our combined business.”
Thinking Capital’s technology-driven approach to lending, as well as its strategic partnerships with banks, payment processors, credit bureaus, and leading brands, are redrawing the landscape for small business financing. Since the company’s inception in 2006, Thinking Capital has increased the size of the addressable market for SME credit by delivering more than $750 million in incremental funding to main street.
“While 98 percent of businesses in Canada are small businesses, many have limited access to capital to fund their growth. As an early innovator in this market, we have spent the last decade evolving the language of small businesses credit,” said Jeff Mitelman, CEO and co-founder of Thinking Capital. “Under the Purpose Financial umbrella our time to market on product innovation and funding capacity will be greatly amplified. We look forward to the new possibilities our union will bring to the small business community.”
Following the Transaction, Thinking Capital will retain its headquarters in Montreal and all employees will remain with the company. Mr. Mitelman will become a Managing Partner of Purpose Financial and will retain a meaningful equity position in Purpose Financial alongside existing investor TorQuest and Thinking Capital’s management.
About Thinking Capital
Thinking Capital, a leader in the Canadian fintech industry with offices in Montreal and Toronto, has reinvented the way small businesses access credit. By combining industry experts and technology, Thinking Capital is enabling business owners to quickly, conveniently, and securely obtain capital to grow their business. Since 2006, more than 14,000 small- to medium-sized Canadian businesses have turned to Thinking Capital for their business financing needs. For more information, visit www.thinkingcapital.ca.
About Purpose Financial
Purpose Financial is an independent financial services company with an unrelenting focus on customer-centric innovation, delivered through technology-driven solutions. Led by entrepreneur Som Seif, the company is developing a diversified product platform aimed at addressing historically underserved segments of the market. Purpose Financial’s businesses include Purpose Investments, Purpose Advisor Solutions, and Purpose Innovation Labs.
For further information: Media Contacts: Thinking Capital, Lizanne McReelis, Boulevard Public Relations, 647-438-5414, firstname.lastname@example.org; Purpose Financial, Lynnette Visaya, Kaiser Lachance Communications, 647-725-2520, ext. 208, email@example.com
Photo courtesy of Gibraltar & Co