FAVO Capital Inc. (OTC: FAVO), a fintech-driven private credit firm, has announced an $8 million equity investment to fund its growth and expedite its plan to uplist to the Nasdaq Capital Market. This development is significant as it highlights the increasing shift of small and medium-sized businesses (SMBs) towards alternative lending options, a trend fueled by the decline in traditional bank loan approval rates from 83% in 2019 to 68% in 2022.
The company has taken a strategic step by converting all super voting Series C Preferred Shares, simplifying its capital structure and improving governance transparency. This move is part of FAVO's effort to cater to the underserved SMB sector through its innovative digital platform, which aims to make the lending process more efficient. The alternative lending market is experiencing rapid growth, driven by the need for more accessible financing options in the face of inflationary pressures and high interest rates.
FAVO's revenue-based lending platform offers SMBs quicker and more flexible access to capital, addressing the urgent need for liquidity and growth financing. The $8 million investment positions FAVO to expand its operations and strengthen its role in the alternative lending sector, providing essential support to SMBs in navigating the current economic challenges.
