The sky’s the limit for construction companies using Flexbase’s new credit card
Today, Flexbase, a Miami-based payment platform focused on the construction industry, launched a new product, Flexbase Card.
The credit card offers up to 60 days of interest-free financing, on top of a range of other features like higher-than-average credit limits and not requiring a personal credit check or security deposit.
Users who are already active on Flexbase’s platform will be able to glean a more holistic understanding of their spending habits by integrating Flexbase Card into their account. The startup claims that it has developed a seamless workflow between the card and the platform, reducing paperwork while increasing invoicing efficiencies.
The CEO and co-founder of Flexbase, Zaid Rahman, told Refresh Miami that cashflow is a major issue facing construction companies. “At Flexbase, our thesis is that most construction companies are either completely broke or one step away from being broke.” According to Rahman, that’s because clients take an average of about three months to pay.
Construction companies often turn to banks to help smooth out their lumpy cash flow. But Rahman explained that banks “don’t know how to underwrite construction companies” and therefore tend to “avoid small and medium-sized construction companies and provide credit to larger companies.”
That’s where Flexbase steps in. Their expertise in the construction industry means that they are better equipped to understand the needs of contractors. (Rahman comes from a family of construction entrepreneurs.)
According to Rahman, the platform has “automated the collection of revenue” for construction companies. Not only can its users collect payment through the platform by generating and e-signing documents like invoices in a matter of seconds, but Flexbase will also follow up with clients until the bill is paid. Through Flexbase’s platform, users can even send out a notice of intent to file a lien.
“The average time to get paid is about 100 days,” said Rahman. “But with Flexbase payments, our goal is to bring that down 50 days.”
The credit card is a natural extension of Flexbase’s platform. The extra time to pay back the card gives users the extra bit of wiggle room that they need to stay afloat. Rahman noted that “with Flexbase Card, you don’t need to rely on short term loan sharks that are charging sometimes two to three percent a week in interest.”
The credit card has nifty features for Flexbase users, like sending reminders to capture receipts and tagging it to a particular project. “That can save dozens of hours of reconciliation work,” asserted Rahman. “When you send out the invoice to the client, it’s all there, magically organized line item by line item.”
How does Flexbase offer such favorable terms through Flexbase Card when banks cannot? It’s their industry insights, said Rahman. “We are underwriting using a combination of tools, including by analyzing the business’s inflows and outflows.”
He continued: “In order to go to that super high credit level, we actually utilize your project contracts, and other project information – underwriting your clients, as opposed to your company.”
Rahman left Silicon Valley for Miami in October 2020. In May, Rahman and co-founder Hadi Solh (pictured above) raised a $2.5 million pre-seed fundraising round. Rahman also runs an early-stage venture fund, 305 Ventures, that invests nationwide with a focus on Miami.
“In Miami, the quality of life is extremely high, the weather is super nice, and there is an extreme diversity of people – which is just natural for Miami.” While Flexbase’s 16 employees are scattered around, Rahman said that there are a pod of employees already in Miami. He also reports that the company is actively recruiting in South Florida, especially for sales and marketing roles to catalyze the 2x or 3x growth rates Rahman expects to see in the next few quarters.
READ MORE ON REFRESH MIAMI:
- Miami proptech Flexbase raises $2.5 million to expand platform, grow team
- Virtual Badge lands $120,000 to further develop digital ID platform
- Novo launches new tool to help small businesses keep track of their finances
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