Quantum: Our First 6 Months

It’s been six months since a 3-way merger created Quantum Financial Technologies, a specialty small business lender focused on partnership based lending. I joined to lead the combined new entity as CEO on the day the deal closed. The 6-month mark is a good time to take stock of what we have achieved and where we are going.

Story of Origin

Quantum was formed by the merger of Fundation, a lender focused on bank partnerships, Camino Financial, a direct lender and CDFI in the Hispanic market, and small business lending operations from Amount, a technology platform that had previously acquired Linear Technology spun off from Fundation/ODX. It was a complex merger sponsored by Philadelphia based private equity firm LL Funds. But the timing was right given asset prices, reduced competitive pressures and optimism about where we are in this unprecedented cycle.?

Said another way, Small Business owners looking to grow have fewer financing options, just as they did post-Great Recession, and this is a great time to lean in.

Statement of Purpose

It is our goal at Quantum to be the largest independent small business lender in the US. Our unique approach is rooted in our history as a partnership-oriented lender to large (often regulated) institutions looking to serve the financing needs of their small business base. Quantum’s business helps our clients process all manner of small business financial products: installment loans, lines of credit, SBA loans, credit cards, secured loans and DDA accounts, while our balance sheet provides a convenient pressure relief valve for credit worthy small business owners who don’t fit our clients credit box. It needs to be said that we are committed to serving this market with responsible credit solutions, something that has often eluded fintech SMB lenders.

The Hard Work of Integration

The first 6 months after a transaction are a hard grind. I have experienced this several times in my professional career. As a senior executive at Capital One bank, I worked on several transactions and integrations that transformed it into the banking powerhouse it is today. I also co-founded StreetShares, a small business lender and SAAS platform that we sold and integrated into MeridianLink.?

Integrations almost never go smoothly. They are complex, hard on people, confusing for partners and clients and can sometimes just collapse in on themselves. In the first 3 months we focused on the most important part: the people (both inside and outside the organization). We built a new leadership team with an integrated organization, rebranded the company to Quantum Financial Technologies, rationalized our office footprint down to 2 offices (Virginia and Mexico City), combined payroll/benefits/insurance, renegotiated our debt, met with as many clients as practical, and created clear short and long term financial plans and goals. Most of this was completed in the first 90 days, allowing us to focus on our goal of building capabilities and a growth engine for the future.

I am particularly proud of the very talented and experienced leadership team at Quantum. In a very short time frame an exceptional leadership team with strong backgrounds in mature companies, entrepreneurship and transaction experience has come together.

Sandip Nayak President: Previously of Amount, Fundation, Capital One and Citi, Sandip helped build out the platform that underpins Quantum. He was instrumental in several prior transactions, including the one that created Quantum. Sandip manages all lending functions, and is also a co-founder of an ai firm.?

Dana Rainford People and Operation:: Previously of Camino Financial, Westwood, Allstate and Citi, Dana leads all things talent, locations and IT for Quantum. She led the integration post-merger, and is now focused on creating and implementing our One Team culture.

Steve Vickrey Finance: Previously of StreetShares, Capital One and GE Capital, Steve leads all our finance, accounting and performance management functions. Steve has been the CFO at companies of all sizes and stages and transaction experience.

Mike Bertrand Product and Technology: Previously of SmartBizLoans, MoneyStream, Intuit and StepUp Commerce, Mike is a serial founder with multiple exits. He has deep expertise in productizing lending platforms.

Dave Sterlitz Legal and Compliance: Previously of Dividend Finance, Equity Key, Union Bank, HSBC and Wells Fargo, Dave brings growth stage risk management expertise to the team. Dave is also a founder having built a compliance management platform for financial service companies.

Prithvi Prabhu Credit: Previously of Koalifi, Avant, Lending Club, Capital One and Intel, Prithvi has credit experience in almost all lending categories and parts of the credit spectrum. He is focused on rebuilding all of Quantums credit and ai tools, processes and operations.

Eddie Heppes, CPA, CGMA Capital Markets: Previously of Amount, Fundation and DeLeon and Stang, Eddie is a long-time Fundation executive who helped build all the finance and funding structure that Quantum relies on.

James Ryan Operations: Previously of Amount, Fundation, Prosper, Freedom Financial and Bank of America. Jim heads up our operations across the US and Mexico, and has broad experiences in banking and fintech operations.

The Future

As we navigate the road ahead, I am confident in our collective ability to drive Quantum Financial Technologies towards growth and success. We have several new innovations and products we will launch in the second half of 2024 that will help lay the groundwork for that growth. As we build out our capabilities, our focus will remain steadfast on innovation, efficiency, and delivering exceptional value to our clients and partners, and their small business clientele.