CORP/BIZ Trucking companies in danger, invoice factoring Co files bankruptcy stops paying freight brokers

Hfcomms

Hfcomms

EN66iq
View: https://youtu.be/OcAmGvwzpQY


The Economic Ninja
96.1K subscribers

Trucking companies in danger, invoice factoring Co files bankruptcy stops paying freight brokers. Instapay flexible (A Invoice Factoring Company) has filed for bankruptcy and has stopped paying its customers and are not answering their phones. This can cause a huge supply chain disruption when shippers are not paid and suppliers are not payed either.

https://www.wsj.com/articles/staffing...


RT 14 minutes
 
Hfcomms

Hfcomms

EN66iq
There are so many holes in the whole supply chain dam right now they can't all be plugged. I didn't know anything about this kind of a service for trucking but without it the independent operators don't get paid I guess. The guy being interviewed by the Ninja is a freight broker and I've watched some interviews of him over the last 6 months as logistics has been more and more of a log jam. People don't see it right away but they are really starting to see it and feel it now.
 
blackguard

blackguard

Veteran Member
It seems like everyday we're seeing more and more signs of economic trouble / disruption. This is another indicator of how thin the supply chain is and it appears to be getting worse all the time. It isn't going to take much for a major break to occur. Prep now, prep hard and please stay safe folks.
 
T

Troke

On TB every waking moment
What was this outfit doing? Betting on Bitcoin? Does not seem to be an obvious reason for bankruptcy. Unless they have a tremendous amount of fixed 'overhead' that is not obvious.
 
Hfcomms

Hfcomms

EN66iq
FLEXIBLE FUNDING FILES FOR BANKRUPTCY PROTECTION (THE WALL STREET JOURNAL)
September 21, 2021

Flexible Funding LLC, a provider of funding to the staffing industry, filed for Chapter 11 bankruptcy, The Wall Street Journal reported. The company said in court papers Monday that it has about 400 active clients and a portfolio of loans and factored receivables of about $110 million. The company has estimated liabilities of between $100 million and $500 million, and estimated assets of between $100 million and $500 million, according to Bloomberg Law.

Flexible Funding files for bankruptcy protection (The Wall Street Journal)

Flexible Funding LLC, a provider of funding to the staffing industry, filed for Chapter 11 bankruptcy, The Wall Street Journal reported.
www2.staffingindustry.com www2.staffingindustry.com
 
Melodi

Melodi

Disaster Cat
Not to try to make this any scarier (it already is) but in 2008 a similar situation in Ireland destroyed businesses that had lasted 200 years when banks suddenly were unable or unwilling to provide what were called "Bridge Loans."

Those were the loans that were used for many decades to get small businesses through a pay period - for example, a pharmacy or a cafe would be able every month to borrow money to make sure all their bills were paid on time because their revenue didn't always come in at exactly the same time they needed to pay bills.

In general, these "loans" were paid off at the end of each month when the money came in, so the banks earned a bit of interest by providing the loans and the business owner knew they would have enough cash flow to get through the month.

Stopping that overnight, in the face of the banking crises, meant that perfectly viable businesses had to declare bankruptcy because they had been reliant on that model. With warning, many could have switched to a different system, but happening overnight, they couldn't.

The situation isn't exactly the same but it is similar, only in this case if the truckers are left holding the bag, the owner-operators will sell or park their rigs, and the associated businesses may also go under.
 
SmithJ

SmithJ

Veteran Member
“Factoring” is not a Ponzi scheme. Businesses all across the country use factoring when their customers stretch them out too far on their receivables and the short term credit markets are tight.

This is not a good development. But, I haven’t seen anything that says how big a player Flexible Funding was.
 
Dux

Dux

Veteran Member
Troke said:
What was this outfit doing? Betting on Bitcoin? Does not seem to be an obvious reason for bankruptcy. Unless they have a tremendous amount of fixed 'overhead' that is not obvious.
Click to expand...
It's a really easy to understand business model. Pay the invoice for a % fee, say pay 90% of it, then get the 100% receivable. If that's all they were doing, then the invoices weren't getting paid back.
 
O

Ogre

Veteran Member
Internal theft is big problem in the FUSA
Click to expand...
Many years ago a friend introduced me to the head of security in Kansas City for a major US chain that is no longer in business. I asked him which was worse, employee or customer theft. He replied, employee - by far.
He certainly knew - the finally caught him.
 
kytom

kytom

escapee from reality
I was driving up to Cincinnati yesterday on I 71 there was some construction work on the southbound side which caused a 5 mile traffic backup. I'm not exaggerating every other vehicle was a semi. I can't remember ever seeing so many trucks on the road.
 
phloydius

phloydius

Veteran Member
Most of the articles about the company I found are behind a paywall (like WSJ).


www.morningstar.com

Market News – Dow Jones | Morningstar

Find out what's happening in the market, today from Global News Select by Dow Jones.
www.morningstar.com www.morningstar.com

From link (5 days ago):

Bankrupt business lender has a lifeline. A Texas bankruptcy judge authorized lender Flexible Funding LLC and its Instapay subsidiary to draw up to $15 million from its existing credit line to ease the company into chapter 11.

Flexible Funding, which filed chapter 11 protection, was authorized to continue drawing from its revolving credit agreement with Umpqua Bank to avoid disruption to its business during its first few days in bankruptcy. Flexible Funding and its Instapay unit provide loans and alternative financing options to businesses operating in the temporary staffing and trucking industries, respectively. The company has said it intends to reorganize in chapter 11. -- Jonathan Randles
 
phloydius

phloydius

Veteran Member
A little about the company, from a month ago:


Flexible Funding Announces the Opening of Their Fort Worth Office

www.inforney.com

Flexible Funding Announces the Opening of Their Fort Worth Office

FORT WORTH, Texas, Aug. 24, 2021 /PRNewswire-PRWeb/ -- Today Flexible Funding, LLC, a leader in the factoring and asset-based lending industry, announced the move of its headquarters from San Francisco
www.inforney.com www.inforney.com

FORT WORTH, Texas, Aug. 24, 2021 /PRNewswire-PRWeb/ -- Today Flexible Funding, LLC, a leader in the factoring and asset-based lending industry, announced the move of its headquarters from San Francisco to Fort Worth, TX. Flexible Funding's Forth Worth office is located in the up-and-coming area of Clearfork, at 5600 Clearfork Main St, only 5 miles from downtown.

"We are thrilled to announce our relocation of our corporate headquarters to Fort Worth to support our growth and the dynamic needs of our entire business," commented Amelia Dipprey, Chief Revenue Officer of Flexible Funding. "Our strategic move will foster an environment for team innovation, accommodate future business expansions, as well as attract and retain experienced talent."

Flexible Funding provides asset-based lending services, payroll funding solutions, factoring services and growth consulting for staffing, transportation, oil & gas, manufacturing and distribution companies. Flexible Funding is also expanding their team, with the recent hire of Steve Sala as CFO and Doug Gregory as CCO. The expansion of their team and of offices in the US market puts Flexible Funding in a position to continue its fast-paced growth while continuing to provide best-in-class solutions to their clients.

"As our company has continued to grow nationally, and as our 'return to office' planning came into focus, we noticed that a strategic effort to centralize our operations was required," commented Managing Member of Flexible Funding, Paul DeLuca. "After a thorough review of options, we are excited to have chosen Fort Worth as our base where we can access excellent talent and have a centralized location that can effectively manage deals across the country. We are maintaining our original California office presence, but our talent acquisition and basing our executive team in Fort Worth will support our goals."

About Flexible Funding:

Flexible Funding has been providing payroll funding for staffing agencies nationally since 1992. Over the past 5 years, Flexible expanded its portfolio into other areas of the industry, including oil & gas, transportation, manufacturing and distribution. Flexible Funding has partnered with a broad range of companies, from startups, to established companies with over $1,000,000 per week in sales. Flexible Funding was 'Fintech' long before the term was coined, and is proud of its technological development in delivering superior collateral management in a fraction of the time it takes traditional Asset Based Lenders.

Liz Floyd, Flexible Funding, +1 (619) 315-9293, elizabeth.f@getinstapay.com
 
hiwall

hiwall

Has No Life - Lives on TB
There is a lot of talk about trucking. Anyone can look at interstate highway traffic cams all around the USA and see for themselves how many trucks are on the road at any time in any state.
There are still a Lot of trucks.
 
Hfcomms

Hfcomms

EN66iq
They sure weren't showing any outward stress and then the bottom fell out if they opened up another office only a month ago. Like the old quote of how you go bankrupt.

First slowly and then quickly!

Whole frickin nation almost.
 
Satanta

Satanta

Stone Cold Crazy
_______________
Scry thing is-no one seems to be able to grasp the Concept that Tomorrow, Next Week, Next Moth or six months from now they are going to find there are not Grocery stores or, the ones open, will be nearly empty.

Talking to one guy and his response? "Oh well, I'll be dead." Yeah, meanwhile you are eating like it's unlimited and doing nothing else and, here's the Big one, asshole-you're not dead and it's happening around you NOW.

Or "I know I/We should start getting ready but...'
 
Hfcomms

Hfcomms

EN66iq
etdeb said:
WOW they have been calling me all year to change to them from our present factor company. We have a very good relationship with our factor company so I told them to stop calling.
Click to expand...

Seems like your kind of in the business. How big are these guys do you think and what kind of impact on the industry overall? If they aren't that big then maybe it's more of a tempest in a teapot but if a lot of independent truckers depend on them it might put a lot of them out of business.
 
I

intothatgoodnight

. . .
Samuel Adams said:
Funny how somebody on the inside is anxious to get this party started.......as some are on the outside.
Click to expand...
It was the "plan," all along.

Factorers are a key part of the capital markets, particularly for smaller companies in certain economic sub-sectors.

Now, the "rest of the question" would be to evaluate how OTHER factoring entities are doing, and in what economic sectors? Is this particular "pullback" merely a factorer who got sloppy with their books, or does it speak to capital troubles beyond the factorer's ability to contend with/resolve?


intothegoodnight
 
rob0126

rob0126

Veteran Member
kytom said:
I was driving up to Cincinnati yesterday on I 71 there was some construction work on the southbound side which caused a 5 mile traffic backup. I'm not exaggerating every other vehicle was a semi. I can't remember ever seeing so many trucks on the road.
Click to expand...

Not to thread drift but thats cincinnati every weekday. (construction and backups)

A lot of freight moves thru cincinnati.

Avoid rush hr if you can(morning and afternoon).

As for the bankruptcy, freight brokers not getting paid is Trouble.
 
I

intothatgoodnight

. . .
SSTemplar said:
Perhaps Walmart will have to start paying their bills on time.
Click to expand...
Heh.

Their sheer buying power/size of orders from Walmart can make-or-break suppliers who do not have the economic might to survive extended periods of time without payment from Walmart.

Few to no other companies can run their businesses the way that Walmart does, in their slow-rolling of payables due. Should be illegal - however Walmart considers slow-pay as one of their key operational business practices. Have pondered whether Walmart could exist WITHOUT this cash-flow/cost-of-capital tactic. De facto, they are using their suppliers to capitalize their operations - would be interesting to read the "payment" clauses in a Walmart supplier contract.


intothegoodnight
 
Last edited:
Hfcomms

Hfcomms

EN66iq
View: https://youtu.be/4STjyVnBGik


If Invoices Are Not Paid Trucking & the Supply chain R Done

We have inflation, supply chain backup and now shippers and companies are not being paid due to invoice factoring companies going out of business.


Follow up to the first video 8 min run time and describes the results coming from this bankruptcy and his interview with the broker yesterday.
 
O

Oldotaku

Veteran Member
When I was still arranging freight for the company making paper products, I dealt with a lot of truckers that were so tight that sometimes they couldn't fill their tanks all the way, only just enough to make the trip to the next hub, and then wait for the check to clear to continue. Loss of a factor house like this has probably sidelined a number of drivers who are going to miss payments. It will ripple through for several months, and may cause further failures.

9idrr said:
So, how tight is the flank strap gonna be on this bronc? Is eight seconds almost up?
Click to expand...

We're not even to the third second yet. Lotta ride left in this bull, and a lot of bull left in this ride!
 
I

intothatgoodnight

. . .
As I have mentioned here, before - reliable access to the capital markets will be a key indicator to watch - small or large.

IF capital pools begin to pull back noticeably, look for cascading failures across several "JIT inventory system" sectors.


intothegoodnight
 
N

night driver

ESFP adrift in INTJ sea
Remember that these factoring companies are totally, TOTALLY unregulated.

RELIC and her former boss talked about this " 'business' model" and how dangerous it was.
 
Last edited by a moderator:
Doomer Doug

Doomer Doug

TB Fanatic
It is like the lube on the wheel bearings didn't get applied on time so the wheel locks and you crash.

Back in the day, when people didn't have factory sealed lube joints I would take a five gallon pail full of grease, glop it on a stick and fill a lube gun. Then you would fit it on the nipple, which was called a zerk? pump it up till the grease squirted out the front tire housing.

This flexible company just froze the cash flow and THAT is fatal to any business.

It sounds like when a truck shows up at the loading dock the driver will DEMAND actual payment and that will also collapse the system. 30 day accounts payable is the only practical way to do it.
 
B

Barry Natchitoches

Has No Life - Lives on TB
phloydius said:
A little about the company, from a month ago:


Flexible Funding Announces the Opening of Their Fort Worth Office

www.inforney.com

Flexible Funding Announces the Opening of Their Fort Worth Office

FORT WORTH, Texas, Aug. 24, 2021 /PRNewswire-PRWeb/ -- Today Flexible Funding, LLC, a leader in the factoring and asset-based lending industry, announced the move of its headquarters from San Francisco
www.inforney.com www.inforney.com

FORT WORTH, Texas, Aug. 24, 2021 /PRNewswire-PRWeb/ -- Today Flexible Funding, LLC, a leader in the factoring and asset-based lending industry, announced the move of its headquarters from San Francisco to Fort Worth, TX. Flexible Funding's Forth Worth office is located in the up-and-coming area of Clearfork, at 5600 Clearfork Main St, only 5 miles from downtown.

"We are thrilled to announce our relocation of our corporate headquarters to Fort Worth to support our growth and the dynamic needs of our entire business," commented Amelia Dipprey, Chief Revenue Officer of Flexible Funding. "Our strategic move will foster an environment for team innovation, accommodate future business expansions, as well as attract and retain experienced talent."

Flexible Funding provides asset-based lending services, payroll funding solutions, factoring services and growth consulting for staffing, transportation, oil & gas, manufacturing and distribution companies. Flexible Funding is also expanding their team, with the recent hire of Steve Sala as CFO and Doug Gregory as CCO. The expansion of their team and of offices in the US market puts Flexible Funding in a position to continue its fast-paced growth while continuing to provide best-in-class solutions to their clients.

"As our company has continued to grow nationally, and as our 'return to office' planning came into focus, we noticed that a strategic effort to centralize our operations was required," commented Managing Member of Flexible Funding, Paul DeLuca. "After a thorough review of options, we are excited to have chosen Fort Worth as our base where we can access excellent talent and have a centralized location that can effectively manage deals across the country. We are maintaining our original California office presence, but our talent acquisition and basing our executive team in Fort Worth will support our goals."

About Flexible Funding:

Flexible Funding has been providing payroll funding for staffing agencies nationally since 1992. Over the past 5 years, Flexible expanded its portfolio into other areas of the industry, including oil & gas, transportation, manufacturing and distribution. Flexible Funding has partnered with a broad range of companies, from startups, to established companies with over $1,000,000 per week in sales. Flexible Funding was 'Fintech' long before the term was coined, and is proud of its technological development in delivering superior collateral management in a fraction of the time it takes traditional Asset Based Lenders.

Liz Floyd, Flexible Funding, +1 (619) 315-9293, elizabeth.f@getinstapay.com
Click to expand...

Why did they move out of California just before declaring bankruptcy?

Is the Texas bankruptcy court more lenient to companis like this?
 
You must log in or register to reply here.
Top