Marketlend Academy: The Biggest Mistake An SME Can Make

Listen to CEO and founder of Marketlend, Leo Tyndall, discuss the biggest mistake an SME can make when it comes to its financial health, and why time management and decision making are critical. If you want to read the full transcript please see below.



I think it’s difficult to say it’s a mistake. I think it’s, it’s unfortunate to say a mistake. I think what’s happened is that SMEs don’t have a lot of time to actually make decisions. And the biggest problem they have is that the options for them to pick the right financier are just not in their face, so the mistake they do is not enough due diligence.


Now, is it a mistake or is it just a difficulty? I think it’s more like a difficulty they have in their space that the first thing most SMEs think when you’ve asked them about finance is “The bank.” And then they’ll go to their bank and they could waste a lot of time where they could find they don’t have probably collateral and can’t even get a loan, or you have this thing that they go on the web and they see an SME lender, and they click a few buttons. Go, “Whammo, I’ve got my money.” But they don’t look at the implications and how that affects their business as a whole.


So the biggest problem that I think we have in Australia, which is a very unusual problem in Australia, is that we don’t have a very deep equity market for small SMEs and we don’t have a very deep debt market for SMEs. So, as a result of that, they don’t have the option say like in the US or something similar where they can actually bring on venture capitalists, or they can bring on other funders to help them with the funding. They have to essentially just take what’s right in front of their face, and the problem being what’s in their face is whoever makes the biggest noise. It’s the SME lender that’s charging 40%. He’s the one who’s going to get the biggest, you know, hits because he’s the one that’s in everyone’s face. They’re not doing enough due diligence.