Twinco Capital ratings EUR3M for its supply chain financing solution

. Leading the round is Spanish VC fund Mundi Ventures, with participation from previous backer Finch Capital and a number of unnamed angels. Twinco Capital also has a financial obligation center with the Spanish financial investment bank EBN Banco de Negocios, which is common for any type of providing company.

Founded in 2016 by Sandra Nolasco and Carmen Marin Romano, Twinco Capital offers a supply chain finance option that includes purchase order financing. To do this, it incorporates with large corporates on the purchase side and then funds providers by paying up to 60% of the order worth upfront and the rest instantly upon shipment.

The whole procedure is digital, assuring a fast decision and quick deployment of funds, and is powered by Twinco’s supply chain analytics and the data it has the ability to access by partnering with both sides of the supply chain.

“The funding of worldwide supply chains is ineffective and costly, the problem of the cost is mostly borne by the providers and in particular by those that are SMEs in emerging markets,” describes Twinco Capital co-founder and CEO Sandra Nolasco.

“Take any global supply chain, such as garments, automotive, electronics and so on. Exporters in countries like Bangladesh, China or Vietnam that have actually been providing European business for years, with stable industrial relationships. Nevertheless, their creditworthiness is still measured only on the basis of annual financials, making access to competitive liquidity a major barrier for growth”.

By having visibility on both sides, including approaching orders, Twinco supplies liquidity to the suppliers “from purchase order to final invoice payment”.

“We do that by evaluating supply chain data– the efficiency of the suppliers, the network results between common providers and buyers (and much more information points I am not enabled to discuss!),” states the Twinco CEO. “In other words, using advanced information analytics we can much better examine, rate and significantly mitigate risk. Fortunately is that the more transactions we fund, the more suppliers and purchasers we add, the more robust is our threat evaluation. We believe there is a strong network result”.

To that end, Twinco generates income by charging a “discount charge” for each purchase order it funds. “Because default rates are a fraction of that cost, we can unlock considerable worth,” says Nolasco.

The fintech is likewise opening a possession class for investors and completes with regional banks that are much more manual and do not benefit from increased presence via network results. Nolasco states that to ensure interests are aligned, the company utilizes a part of equity to likewise purchase the purchase orders it funds.