Helping businesses realise their potential (Sponsored)

Apr 01, 2020
Clearpath Finance is helping businesses throughout the island of Ireland access much-needed finance at competitive rates from a diverse range of lenders.

With global credit again tightening as a result of the COVID-19 pandemic, small- and medium-sized enterprises (SMEs) find themselves among the first to be hit when seeking badly needed working capital. The traditional banks are facing liquidity issues as corporate customers and others draw down cash to bolster balance sheets and this further restricts their ability to extend credit   to hard-pressed SMEs.

Clearpath Finance has been   meeting the credit needs of Irish SMEs since 2016. As the name suggests, the firm offers a simple and clear process for businesses seeking much-needed finance.

“We have been addressing the liquidity issue that has been facing Irish businesses since the last economic crash,” says Clearpath Finance co-founder, Conor Devine MRICS. “Unfortunately, the Irish banking system is still undergoing repair and its activity in the SME lending space is still quite subdued. Businesses need financial support and access to capital so they can continue to grow and invest in their own value proposition. We help businesses realise a lot of their potential through our reach and diverse range of funding options.”

Clearpath has its origins in the debt advisory practice, GDP Partnership, which Devine, a Chartered Surveyor by profession, co-founded with solicitor James Gibbons in 2010. The pair subsequently put a multi-disciplined platform together to bring mediated debt resolution solutions to the marketplace.

While GDP continues to be successful, it highlighted the problems of liquidity and access to finance facing business owners. “We decided to launch an alternative lending business where we would bring new money to the island of Ireland and help drive the economy north and south,” Devine explains.

The new business quickly gained credibility by providing the funding for a customer to exit from a major private equity investment in a deal worth more than £100 million. “We started with one alternative lender based in the UK and today, we have over 60 different lenders on the platform providing a range of solutions for our customer base.”

In essence, Clearpath is intermediary between lenders and business borrowers. “We offer a route to market for our investors and funding partners’ capital,” says Devine.
These partners include mainstream banks, peer-to-peer lending platforms, bridging finance companies, mezzanine funders, and private equity lenders. The firm also manages a portfolio of private family office money.

“The process is quite straightforward in that when our team receives an enquiry for finance, we engage immediately with the customer and request various pieces of information,” Devine explains.

A detailed credit paper based on this information is then sent to Clearpath’s panel of lenders and investors. “The process is quite quick, as we are well-known in the industry for preparing excellent credit papers. We would typically have a decision in principle from the funding partner best suited to the deal within a few days. If the customer accepts the funding offer, we proceed to legals and a member of our team then liaises with the various solicitors to ensure the process is completed satisfactorily right up to draw-down of funds.”

While this directly tackles credit availability, Clearpath is also addressing the cost of credit. “One of the challenges in the SME sector over the last few years has been the lack of appetite and ability of the mainstream lenders to fund the business community across Ireland,” he points out. “A direct effect of this has been an increase in the cost of funds. The trend over the last few years is that pricing has increased from mainstream rates of 4-5% to pricing rates in the range of 6-12% more typical of alternative sources. It is up to Clearpath to find the best deal possible in terms of pricing and delivery for our customers.”

That service is underpinned by the diversity of lenders on the funding panel. “The SME community needs access to finance and the broad church of lenders and investors we now have access to enables us to bring a great level of value to our customer base across the country. This is one of the things that sets us apart from everyone else in this space.”

And businesses of all types and size can benefit. “Our target market is the business community across the island of Ireland,” he continues. “We now have a range of products and solutions that will benefit every business.”

Unsurprisingly, the market response has been very positive. “Our business has gone from strength to strength over the last few years,” says Devine. “I think there are several reasons for this, but at the core of it has to be that our customer base like us, they trust us, and we always deliver. It is a very crowded space in Ireland right now, and I have found that one of the strengths of Irish people, in general, is that we are great talkers. However, it is the follow through and delivery that counts in this business and this is something we are extremely proud of as we never let our customers down.”
Simplicity is at the core of the offering. “We like to keep it simple at Clearpath. What is it you need? Get us the information and we will deliver for you. This goes down very well with our client base as well as our funding partners, as we only support businesses and loans where there are robust business plans in place along with proven repayment capacity in terms of servicing any new debt facility.”

Clearpath also has plans to address the housing crisis and the increasing demand for finance to fund green energy projects. “There are several big-ticket issues like the housing crisis facing the Irish economy right now. We have been working on a solution for this in terms of a funding and construction model on which we are currently getting some traction, and by the end of this year would hope to be able to speak about many projects in that space where we are playing a central role.”

Green energy funding is also a target. “We are very excited about that side of our business,” Devine explains. “In the last couple of years, we have invested significant time and resources in understanding the green energy market, and we know there is €2 billion worth of biogas plants planned for the Republic of Ireland in the next five years. We have an intimate understanding of this market and funders in place ready to work with green energy developers to achieve project delivery. Along with the wind projects we helped deliver in Northern Ireland, this is a very exciting part of our business which we look forward to growing in the immediate term.”

Real estate loan sales also offer a path to growth. “There has been over €120 billion worth of loans sold by Irish banks in the last ten years. We are heavily involved in that space in terms of providing funding solutions to borrowers who want to retain control of their property and business interests. We have a superb track record in this sector and again, we see huge potential in it.”

Looking to the future, Devine says the plan is to continue to grow the business across the island of Ireland. “This means delivering more liquidity and more capital to business owners across the length and breadth of the country.”

For more information, visit www.clearpathfinance.com or contact Conor at conor@clearpathfinance.com or +44 333 0042 888.

(This article is sponsored by Clearpath Finance.)