Ryan Martin, general manager of Strawberry Road Auto Sales in Pasadena, Texas, is one of the scores of independent dealers NextGear Capital is trying to help via its enhanced Account Portal.
“Having the right tools and technology to support my dealership was one of my top priorities when it came to selecting a floor plan,” Martin said in a news release from NextGear that recapped three major enhancements the company made to its Account Portal during the first quarter.
“There is nothing worse than having to call someone else when I want to floor my inventory or access information about my account. NextGear Capital’s Account Portal gives me the freedom to view all of my account information with just a few easy clicks,” Martin continued.
According to NextGear, those enhancements include:
• Enhanced title page: The company acknowledged that tracking the status of a title is one of the most time-consuming aspects of purchasing a vehicle. The newly enhanced title page can give dealers greater visibility to the status of a title, its due date to NextGear and the number of titles eligible for release.
Dealers also can access tracking information, title location and more.
• Streamlined flooring experience: The company highlighted flooring non-auction purchases is now easier than ever with the ability to send titles directly to NextGear using a pre-paid FedEx waybill and expedited ACH funding to a dealer’s account once a funding request has been approved.
Other new features include the ability to request the full purchase price without having to contact a representative, priority review and processing of funding requests, and visibility into the projected finance amount.
• Improved reporting capabilities: The reports page now can allow users to navigate away from the page while a report is being generated, freeing dealers to do other things while waiting for their reports.
In addition, this new page will also store reports for 24 hours.
The company went on to mention the online account management platform can provide NextGear clients in good standing with other real-time information, helpful tools and insightful dashboards accessible 24/7 from any computer or mobile device.
As mentioned, other features include an intuitive flooring process for non-auction purchases, as well as access to vehicle valuations to help dealers make smarter sourcing decisions and the ability to view and manage outstanding audits in real-time.
“The needs of independent dealers are always evolving, which is why we’re continuously making investments in technology like Account Portal to meet and exceed those needs,” NextGear president Scott Maybee said.
“While any floor plan can give dealers more buying power, a tool like NextGear Capital’s Account Portal delivers added value by helping dealers streamline their operations and create efficiencies, making it simpler for them to do business with us,” Maybee went on to say.
In a move intended to improve cash flow for independent dealers, NextGear Capital on Thursday introduced a new program for its floorplan financing.
The company highlighted its new flex pricing program can reduce the principal paydown rate to .01% per period — what NextGear believes is one of the lowest in the industry — and can simplify the payment process by eliminating certain fees.
“Like most small businesses, cash flow concerns are a common challenge for independent dealers,” NextGear president Scott Maybee said in a news release.
“We listened to our dealers and appreciate that this is a pain point for them and went to work designing a flexible option that gives dealers greater cash flow to invest back into their business,” Maybee continued.
NextGear explained that its flex pricing program offers significantly lower payments and fewer fees when compared to standard pricing plans. The company elaborated on the offering by citing a $10,000 auction purchase as an example.
A standard term plan with a customary 10% principal paydown rate would require a $1,000 payment when the vehicle’s first principal reduction comes due. With flex pricing, the company said the principal paydown rate of .01% produces major savings, resulting in principal reduction payments of only $1.
Additionally, NextGear noted that the flex pricing program can eliminate the standard plan’s records charge and primary monthly audit fee.
NextGear currently provides full-service floor plan financing to more than 22,000 independent dealers nationwide.
“Our goal is to be a resource for these entrepreneurial-minded dealers and a partner in driving their business success,” Maybee said. “Flex pricing joins the full range of products, programs and floor plans we offer, all designed to give our dealers choices that work best for their diverse goals and needs.”
Maybee hinted programs like this one were coming when he appeared on the Auto Remarketing Podcast in February. That episode is available in the window below.
This isn’t Marty McFarland’s first experience in starting up a company. But it is the first time he’s been involved in one during a pandemic.
McFarland appeared on the Auto Remarketing Podcast not only to recap the journey Kinetic Advantage has navigated so far, but also how the floorplan company is looking to build a sizeable customer base of independent dealerships.
To listen to this episode, click on the link available below, or visit the Auto Remarketing Podcast page.
Download and subscribe to the Auto Remarketing Podcast on iTunes or on Google Play.
Scott Maybee now has been the president of NextGear Capital for a little more than a year. During much of that time, the pandemic has impacted how the floorplan company functioned internally and with its independent dealership client base.
Maybee joined the Auto Remarketing Podcast to describe what that experience has been like for him and the company, as well as what programs NextGear has in store to help independent operators.
To listen to this episode, click on the link available below, or visit the Auto Remarketing Podcast page.
Download and subscribe to the Auto Remarketing Podcast on iTunes or on Google Play.
It’s been an active opening month of 2021 for Kinetic Advantage, a newly formed floorplan financing company with an eye on gaining market share among independent dealerships.
After landing an undisclosed amount of funding through Altamont Capital Partners, Kinetic Advantage this week announced the launch of its new cloud-based auditing program as well as a major facility and workforce expansion plan aided by support from the state of Indiana and the city of Carmel.
Beginning with the technology news, Kinetic Advantage said its new auditing platform is the first of its kind. The company explained its cloud-based Real-Time Intelligent (RTI) Auditing System is designed to address a long-time pain point for dealers undergoing the traditional audit process with their floorplan provider.
Powered by 12th Tech, Kinetic Advantage highlighted that its system is geared to revolutionize the auditing industry, converting it from a labor-intensive, expensive and mostly manual process into a sophisticated, cloud-based and robust electronic verification auditing system that can provide reliable, accurate and cost-effective analysis and reporting.
Kinetic Advantage explained that its auditing methods can allow its dealer clients to enjoy real-time interaction with a collateral audit specialist via action alerts, a chat feature and other reporting functionality. The wizard-based mobile audit capabilities are optimized across phone, tablet, laptop and desktop devices for staff, auditing teammates and dealer clients.
The company also noted that the system provides an innovative widget than can automate and streamline the reconciliation of collateral that is not manually verified, such as sold units, test drives or other offsite units.
“By utilizing our custom configuration of 12th Tech’s Real-Time Intelligent Auditing System, we are the first company to provide this leading technology to independent dealers,” Kinetic Advantage director of audits Jeremiah Johnson said in a news release. “We are focused on continuously improving the dealer experience, and this new system enhances the quality and accuracy of their audit data.
“With its intuitive design and great user experience, the system has also enabled dealers to more effectively manage risk across the entire audit process,” Johnson continued. “At Kinetic, we are offering our clients the ability to focus on their operational needs, while we streamline the audit process through our industry-leading technology.”
Mark Abrams, chief executive officer and founder of 12th Tech added this perspective.
“Legacy systems available to the industry for auditing are no longer good enough,” Abrams said. “We saw the immediate need for a robust, flexible, mobile and easy-to-use auditing system that enables dealers and finance companies to not only mitigate their risks with better insight into their inventories, but also drive real-time, secure reporting and analysis.”
Workforce and facility upgrades
According to a news release distributed by the city of Carmel, Kinetic Advantage also is quickly developing its human capital and brick-and-mortar resources, too.
The company, which currently operates out of 24,500 square feet of office space at 10333 N. Meridian in Carmel, plans to invest more than $4 million to expand its new headquarters, leasing and equipping an additional 34,200 square feet in the same building.
The additional upgraded space will allow Kinetic to grow its client base and continue to provide technology-driven solutions to independent dealers across the U.S.
Kinetic Advantage plans to have the expanded space fully operational by April.
To support its growth further, Kinetic Advantage has already added 65 new Indiana-based positions since July. The company plans to continue growing its team by creating up to an additional 225 new jobs over the next few years.
Kinetic Advantage has secured more than $225 million of initial debt and equity funding to support its expansion, according to the city’s news release.
“I’ve been involved in three startups in Indiana and have found that Indiana is a great place to build a business given the educated workforce, excellent work ethic and pro-business climate in Indiana,” Kinetic Advantage CEO Marty McFarland said in that news release. “I am thrilled to work with my Indiana teammates in building an employee and customer-centric business.”
The Indiana Economic Development Corporation offered Kinetic Advantage up to $5 million in conditional tax credits based on the company’s plans to create up to 273 jobs by the end of 2024. These tax credits are performance-based, meaning the company is eligible to claim incentives once Hoosiers are hired.
The city of Carmel supports the project.
“We are thrilled that Kinetic Advantage has chosen Carmel for its corporate headquarters along the Meridian Corridor, which continues to attract high-paying jobs,” Carmel mayor Jim Brainard said. “We work hard to create and sustain a high quality of life so that companies like Kinetic Advantage will have a large pool of highly educated residents to fill the new jobs they create. We look forward to watching them grow and succeed in Carmel.”
The Hoosier State’s top elected official also cheered Kinetic Advantage’s plans.
“With Indiana’s best in the Midwest ranking for entrepreneur friendliness, we’re committed to providing the business-friendly environment and skilled workforce that companies like Kinetic need to grow operations,” Gov. Eric Holcomb said. “Kinetic’s rapid growth, even during the pandemic, is impressive, and we’re grateful for the quality career opportunities that the company is creating for Hoosiers.”
Kinetic Advantage already has launched in 26 markets to date and will continue expanding nationally by developing relationships across auction platforms. The company will continue ramping up hiring this year, and open positions will be posted online as they become available.
Altamont Capital Partners said the investment firm is “impressed” with Kinetic Advantage, a newly formed floorplan financing company led by industry veterans Marty McFarland, Randy Dohse and Chris Brady.
While specific terms of the transaction were not disclosed on Monday, Altamont announced that it committed “significant equity capital” to Kinetic that so far has a presence in 21 markets.
Led by McFarland, who co-founded Dealer Services Corp. (DSC) in 2005, and joined by Dohse as chief operating officer and Brady as chief information officer who both worked with McFarland at DSC, other members of the highly experienced leadership team at Kinetic are Joe Keadle as senior vice president of of operations and Joe O’Brien as senior vice president of sales and marketing.
The group formed Kinetic with the vision to provide a better floorplan experience to independent dealers by streamlining the customer experience, increasing flexibility and offering increased transparency around fees, all enabled by a market-leading technology platform.
Launched in 21 markets to date, leadership said Kinetic will operate nationally with relationships across auction platforms. In total, the company has secured more than $225 million of initial debt and equity funding to support its expansion.
“Having operated in the auto sector our entire careers, my team and I see a real need for a new provider that can serve as a truly platform agnostic floorplan financing partner to independent dealers,” said McFarland, Kinetic’s chief executive officer.
“We recognize the pain points present in the industry — which have only been exacerbated by the pandemic — and are optimistic that our entry into the market will provide a welcome solution to our new dealer and auction partners,” he continued.
And now Kinetic has more resources for market entry thanks to involvement from Altamont, a private investment firm based in the San Francisco area with more than $2.75 billion of assets under management. Two if tis managing directors discussed the support of Kinetic.
Keoni Schwartz said, “We were impressed by the vision that Marty and his team discussed in our initial dialogue and are thrilled to partner with Kinetic. We have deep familiarity with floorplan financing through our prior investment activity and current portfolio, and recognize the clear market need for a true partner to dealers that will provide transparent pricing, a hassle-free collateral audit process and technology solutions that deliver a more streamlined experience.”
Sam Gaynor added, “Altamont has a track record of backing best-in-class operators in financial services to address market needs, and that is the case with Kinetic. We have committed significant equity capital to the business to support its ambitious loan growth forecast and look forward to leveraging our breadth of operational resources to ensure the success of its national rollout.”
Stephens acted as the exclusive financial advisor and Ropes & Gray and Morrison & Foerster served as legal counsel to Kinetic and Altamont. Financing for the transaction was provided by MidCap Financial.
Independent dealerships now have another option to secure a floorplan.
First Business Financial Services, a Wisconsin-based bank holding company, recently launched its newest product — aptly named Floorplan Financing — and brought in a trio of veteran automotive executives to run it.
The company highlighted Floorplan Financing allows dealers the flexibility to finance their acquisition of used vehicles, preserving cash flow and allowing dealers to buy preferred inventory. Floorplan Financing is the latest expansion of First Business’s specialty finance solutions, offering floorplan programs from $500,000 to $10 million for larger, well-established independent dealers.
“This limited focus, a hallmark of First Business’s business model, facilitates a smaller clientele than large competitors, empowering personalized concierge service,” the company said in a news release announcing the new product.
Industry veterans Jeff Widholm, John Goodyear and Amanda Schreeg have joined First Business to operate Floorplan Financing. Widholm will be the managing director, with Goodyear serving as vice president and Schreeg holding the role of servicing manager.
First Business noted that Widholm has 13 years of experience in dealer floorplanning, primarily serving independent dealers across the United States and Canada, with responsibilities in credit, collections, sales and operations. The bank added he brings a wealth of experience as an executive on the corporate side as a chief operating officer of a floorplan finance company and a chief financial officer of a multi-store franchised dealership.
The bank mentioned Goodyear has 22 years of automotive industry experience, including 14 years in the independent floorplanning finance market, primarily servicing the lending needs of large independent dealers across the United States.
First Business recapped that Schreeg began her career in the accounting world with a small logistics brokerage and then transitioned to the floorplan industry. Over the past six and half year years, she has gained an array of floorplan knowledge through numerous roles. She was nominated as Power Driver of the company and obtained her NIADA Certified Master Dealer certification.
“We’re thrilled with the experts we’ve brought on to build and deliver our Floorplan Financing solutions,” First Business Financial Services chief operating officer Dave Seiler said. “They have so much experience and share the First Business vision of focus and client service.”
Widholm added, “Joining First Business has been an exceptional experience. First Business is a perfect alignment for how we differentiate ourselves from our competition — through concierge service, expertise, and competitive pricing.”
Floorplan Financing is offered through First Business Equipment Finance, a subsidiary of First Business Bank. The offices are located at 9465 Counselors Row, Suite 200, in Indianapolis and can be reached at (844) 418-2493.
