Tony skinner
Hi, and welcome to the podcast channel on podcast my business.com.au and today we have Linden toll from www.apricityfinance.com/
Linden Toll
Hi there, Linden. Good day, Tony, how are you? 
Tony skinner
I am Yeah, I think as we discussed, oh, I think somebody wants to kick me out. 10 minutes 10 minutes, sorry. Sorry, there we go. And that’s the sort of, I’m gonna leave these in this sort of day that I’m having at the moment I booked the room, and I booked a room but apparently I booked it too late to get it for the time that I wanted. And now there’s heaps of people around in the office, whereas the last few weeks has been nobody around. What can I say?
Linden Toll
All right, so do you want to reschedule or
Tony skinner
Okay, going we will keep going like so. Leave these in. So what I’m curious about is invoice financing. And in business, of course, you send out an invoice. And I’m lucky, my invoices get paid before I do the work, but it’s not always possible.
Linden Toll
Now exactly and hence we have a business, Tony. Generally, people like to pay with extended terms, and particularly larger companies here in Australia and globally, who have far greater strength, then you as the supplier, like to push your terms out to say 30 45 60 in some instances 90 days, which doesn’t really work on your cash flow because invariably you might be paying staff or you’ve got to pay for goods to go into what you might be delivering yourself. So invoice finance just provides upfront payments to you for your invoices. So effectively you’re using the assets on your balance sheet, which are your invoices. just bringing the payment forward to you, you’re getting your money faster.
Tony skinner
I’ve been hearing a lot about that, that lots of the government’s been forcing around departments that you find it’s not paying on time.
Linden Toll
Yeah, there’s a fair bit going on at the moment, number of hearings, etc, around it. And government’s obviously conscious, particularly with COVID going on at this point in time that suppliers are getting paid in good time, if you like, even though they’re sort of looking at sort of 14 to 20 days type space as well. So it’s not cod like a good old fashioned days of dropping stuff into the greengrocer and being paid out of the till type stuff here. You really are talking lengths of time. So they’re trying to bring stuff back to or try to, if you like, shame the big companies into paying within 30 days. And we’ll see how that goes.
Tony skinner
Well, and especially with the above We’re going through at the moment, even 30 days can be a long time for any business.
Linden Toll
Yeah, look any day over the day you’ve delivered your services is a long time. So unfortunately, there is that gap. And so therefore, obviously we have a business we saw a gap at the time, you know, banks are very good at promising to deliver to SMEs are generally fairly short on delivery, if you like with it. So there’s an opportunity for us to get into that space and look after the suppliers in that area. 
Tony skinner
So how did you start? Start off with apricity finance
Linden Toll
started apricity in 2013. As I said, I come from a funds management, financial markets background, and I guess we, we look at it more on a funds management basis that effectively we’re creating short term credit on, you know, the biggest companies here in Australia, so We saw an opportunity in in the market that the banks don’t necessarily want to get involved with to provide this service. So we started out on a coffee table and using our own money at the time and a couple of investors from our funds management day, and it’s kind of grown from there. We’ve gone from myself and what I was loosely he was loosely described as CFO at the time. He now is very firmly a CFO on our coffee table, and we now have over 20 staff across Australia and New Zealand as well.
Tony skinner
Fantastic. So I guess is a risk for you as well, because QBE was saying that we’re going to provide finance or insurance coverage for suppliers of MYER. So that’s sort of circumstance impact you.
Linden Toll
Look we, we obviously have fairly credit tight credit processes and we’re always looking at industry specific issues. Obviously, retail is a is a sector that has been influenced or affected for many years, I guess now, based on online shopping. So it’s it’s not an area that we’ve necessarily focused on over time. But you’re right. Insurers, again, in many respects are fairweather friends. You know, while things are rosy, and we’re all paying our premiums that are supposed to cover, you know, the, the nightmare event, the minute the nightmare event occurs, suddenly, our premiums will go up, and they’re not necessarily paying.
So there is some of that around at the moment, a lot of say the trade credit insurance market, a number of the companies are not being insured at this point in time based on risk. And so, but I guess our model is quite different to that. And as I said, At the start, we we look at suppliers to the biggest companies in Australia so you’re bhps your ratios here, your quantas Yeah, they will worse and government and so forth. So I guess if you want a really simple risk model that we ran, Put simply, is that if these companies fall over, then none of us have really got jobs. So we don’t necessarily insure that risk based on the fact that, you know, a bhp is generally going to be around they, they won’t pay their bills on the day that you deliver services, but they will pay their bill so that there is risk out there. And, you know, obviously, the tourism space is one that would have some hiccups at this point in time again, for us, we are only looking at the biggest companies in Australia and New Zealand. So therefore, tourism tends to be smaller operators, which we don’t necessarily look at.
Tony skinner
Yeah, and that’s true. So you’d be looking at someone like QANTAS.
Linden Toll
it is potentially risky at this point in time. But, you know, again, I guess if you think about risk, I would imagine that the Australian government’s not gonna let the flying kangaroo go down. So I guess it you have to be sort of, I guess, broad minded as it relates to credit loss being, you know, fairly focused on on that, but, uh, Qantas is a great example. I mean, you have people providing, you know, little pots of jam for the front to the pointy end of the plane through to in fact, I was just on a plane up to Brisbane last week and notice a company called zunow have little sachets of handwash stuff.
There’s a little company that started up a few years back with a product that is effectively 24 hour protection on your hands. And so there’s a business right here right now in the current environment that’s pretty ordinary, which is doing really well and they are on the Qantas planes So that there’s plenty of suppliers into that it’s it’s really only only sort of shortened up by your own imagination as to what’s being supplied to them.
Tony skinner
Yeah, and that’s interesting, because risk is something that’s been a common theme. The interviews I’ve been doing last few months with every business is that there is risk out there. And they’re talking about business growth. I’m thinking about growing this business, for example, in different ways. And I guess it depends on your appetite to risk so would you say, now’s a good time to take on some risk? If especially if competitors are falling by the wayside?
Linden Toll
I think it comes down to the individual. I think that being being a small business operator, you’re naturally a risk taker if you’ve moved away from being employed to taking a risk and so therefore, calculated risks at this point in time, you know, make sense Obviously bearing in mind what that risk means if it was to go the wrong way. There’s a lot of small businesses out there that that we see and help who, you know, might be tied up with a bank. So plenty of security over their house and other assets that they might own.
And so in every one of those instances, you have a partner sitting at home, who is worrying about the decision that the entrepreneurs making each day, you know, what’s what’s, what risk is he or she taking, as it relates to our family assets, if you like. So, I think it needs to be measured against, you know, risk and return. But I do think that, you know, there are real opportunities there. Right now, I think that, like you say a lot of businesses are going to disappear over time. And so there’s this huge opportunity there. 
Tony skinner
Absolutely. So, if you had some tips for business, maybe have a style starting or what have you at the moment And in relation to using invoice financing, what sort of tips would you have for business?
Linden Toll
Well, I think you want to make sure initially that you kind of capitalized for at least 12 to 18 months so that you know if it’s if it is as long as experiences we’re all thinking he that, you know you covered in that that instance I think then that you want to ensure you’ve got the right people around you I firmly believe in good relationships with good advice. So your accountants, your lawyers, those types, utilizing your friends from school, your parents advice that you can get from, you know, people who’ve been through different cycles and so forth can help you I think the big that’s the big one for me is, is getting that advice.
And weirdly, you know, talking with some people yesterday around this whole COVID thing is ordinarily we as human beings seek out advice on situations from our parents or from mentors or from other business partners we may have had over time, there’s not a single person in the world that’s been through a pandemic before, from politicians to royalty to, you know, the average bloke in Australia. So I do believe, though, on a business, business startup that there’s plenty of good advice, good solid advice out there. And don’t try and take on the world too fast. You know, grow it slowly and, and, and look organically at the way you can make things work.
Tony skinner
You and I think organically is a great, the great lesson out of all of that, but also, yeah, ask for advice. I think we all especially in business, we get a little bit too proud. I should know everything. I should be able to do everything. I don’t want to ask for advice or support. Get it? Get it before you actually need it.
Linden Toll
Yeah, exactly. And like you say, we all think we’re experts at everything, but the reality is that there’s plenty around us who want to help And that’s the other side is that people want to help, you know, we as a society have great human beings who really want to help you do stuff. So don’t be afraid to sing out. 
Tony skinner
Yeah, I’m just thinking that as soon as that is thought that’s going to be the title of this one, don’t be afraid to ask for help. So thank you for that. All right, great, Lyndon. Thanks very much for your time. Absolute pleasure.
