Who’s Next?: Marco Financial Breaks the Mold in Trade Finance

“It seemed to me like there really has to be a better solution to support business owners in Latin America, especially where there isn’t as developed credit infrastructure, where there aren’t as many banks and non-bank lenders that can really help these businesses grow, and that’s when we really started to dig deeper into the space,” Shoihet, who serves as CEO of Marco Financial, says.

But how did Shoihet and Spradling identify this market need — which could include a $1.5 trillion financing gap, according to the company — and join forces to address it? To answer that question, we’ll have to take a look back at the rather winding road the two business partners took to find each other.

Let’s start with Shoihet. He does not fit the mold of the traditional financing executive. Even though many leaders in specialty finance claim to have entered their respective industry coincidentally, they at least have some sort of finance background. For Shoihet, the path to the industry was a bit more circuitous.

“It was really an interesting lens to see how these organizations, as they continue to raise money to grow and scale, the challenges they had, how leadership operated under those conditions,” Shoihet says. “That is how I started to fall in love with the idea, and it was really my dream to start my own venture at some point. I always had these entrepreneurial aspirations.”

That’s when Shoihet met Spradling, who was all too familiar with those pain points. Originally from Uruguay, Spradling’s family has a history in importing and exporting goods in Latin America, which is the same path Spradling followed, starting multiple businesses beginning when he was a teenager. After launching a food importer called Organic Food Solutions, Spradling saw just how difficult and slow the process of getting funding could be. Even as the business did roughly $10 million in annual sales volume, Spradling still found himself spending 50% of his time looking for financing and waiting for months to get funds.

“Peter and I are very pragmatic, very logical, rational decision-makers,” Shoihet says. “We’re very, very calm in temperament; we don’t bring emotion into any decision making, and we saw the opportunity in the space very, very clearly.”

Shoihet and Spradling co-founded Marco Financial and led its recent launch. The duo work in tandem as a 50/50 partnership, with Shoihet serving as CEO and handling fundraising, talent development and organizational continuity, while Spradling serves as chief operating officer and handles day-to-day business development and operations.

“We wanted to hire a top tier credit team that was really energized and understood that this is a space that needs to be innovated upon,” Shoihet says. “We want to really be a customer-first partner, so we want to ensure that we’re hiring people that are really on board with our customer-intimate nature.”

A Cleaner Lending Process

“Technology is what anchors our entire workflow, from origination through underwriting through servicing,” Shoihet says. “The way we think about technology is a way to really provide a friendlier, more lightweight experience to our customers. Most folks use different softwares for servicing, but the fact that we’re approaching it from underwriting and origination in addition to servicing really ensures that it’s a much cleaner process.”

“If an SME is seeking this sort of financing, they usually need it in relatively short order,” Shoihet says. “We have an internal mandate to be able to underwrite transactions within business days, and we take that extremely seriously.”

“We’re going to not only improve our processes over time — meaning faster, less operational weight — versus just doing the exact same process for every transaction in perpetuity,” Shoihet says. “The whole idea is to be able to get this process to as quick and friendly a process with as minimal documentation for our customers as possible.”

Aside from being “tech-enabled,” Marco Financial is fueled by venture capital. Investors like Struck Capital and Antler have already provided support, while Arcadia Funds delivered $26 million in funding to the company in late September, providing the type of liquidity, flexibility and speed Marco will need to build in the coming months.

The financing from Arcadia Funds also helped Marco Financial officially launch and begin making deals. Getting to that point during a global pandemic certainly had its challenges, but Marco Financial’s technology focus made overcoming those hurdles more seamless than it might have been for a more traditional company with legacy infrastructure and a heavier reliance on in-person interactions. However, Shoihet still understands the importance of creating relationships.

In addition to forming those bonds, Shoihet has the company focused on getting deals into an already active pipeline, building out the operations team, fundraising for a next venture capital round, and developing internal data and product infrastructure, with an eye toward expanded offerings as the company scales up.

New products will likely be born out of new opportunities in the marketplace. With what Marco Financial has accomplished during the startup phase of its journey, it will be worth keeping an eye on what those turn out to be.