Post-lockdown liquidity from Cloudfloat

by Angus Jones


Pandemic and related restrictions have worsened the ‘cashflow crunch’ for small businesses, super-charging demand for Cloudfloat B2B cashflow on-demand platform. Cloudfloat’s platform allows suppliers to get paid on time. Buyers get payment terms to suit their own needs, earn supplier loyalty and avoid reputational risk

COVID-related lockdowns have created unprecedented pressure on small businesses. Many will find usual suppliers and customers have not survived. With the cashflow crunch often extending along the length of the supply chain, many are struggling to get paid, even with a reliable sales pipeline. As restrictions ease and small businesses try to re-open, cashflow is more critical than ever.

Late payments and bad debts create enormous costs for small businesses and stifle growth. Chasing receivables is stressful and diverts owners from running their businesses. Lax processes, unethical business practices or cashflow problems elsewhere on the supply chain often force SMEs into becoming providers of free credit to their clients.

“Cloudfloat is their post-lockdown liquidity lifeline. It can be a significant force in getting Australian business back on its feet,” said founder and CEO Aleem Habibullah.

Cloudfloat’s innovative B2B cashflow management solution provides a digital float allowing businesses to pay their invoices over time by instalments. Businesses can smooth out their cashflow whilst getting the payment terms their business needs for an up-front flat fee per transaction.

Unlike traditional ‘Buy Now Pay Later’ (BNPL) models, buyers pay an upfront fee to receive an interest free period instead of suppliers being forced to absorb a high merchant fee for the payment service.

“Sellers gain smooth, reliable cashflow, reduced admin and stress and more time running their businesses. By paying on time, every time, buyers gain preferred customer status at a time when sellers need support and supply chains are tightening,” said Mr Habibullah.

“Cloudfloat’s inbuilt verification, anti-fraud and regulatory compliance systems provide businesses with the opportunity to reduce counterparty risk and minimise bad debts. This is critical at a time when online fraudsters and cyber-criminals have upped their game and begun seriously targeting small businesses,” he said.

Demand for Cloudfloat’s services in its first year of operation has far outstripped its current capacity to service it. With lockdowns ending and economies opening up, this will accelerate.

To meet this demand, Cloudfloat is accelerating a planned capital raise designed to bolster the balance sheet and secure substantial financing to service client transactions. Cloudfloat has already progressed discussions with potential equity and debt investors, including existing shareholders.

“Our experience shows that our B2B ‘BNPL’ model provides the opportunity for viral client acquisition, is highly scalable and can address a significant gap in the trade financing market. With demand for Cloudfloat’s solution far outstripping our current capacity to service it, the business is poised for aggressive growth”, Mr Habibullah said.

“It’s a very exciting time for Cloudfloat as we prepare for a step-change in scale.”\

Also, read Small Business Answers guide to raising funding.

Other guides like this

Leave a Comment

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More