Bye Bye cashflow problems for MSMEs!

Cash flow is a major challenge for the MSME sector in the country. Businesses operating in this segment have been surviving using ‘jugaad’. However, not every MSME has access to these fund sources. So, for many MSMEs who are first time entrepreneurs or are not from business families, going sometimes do get tough.

To offer a very viable solution to this pertinent problem, Shivam Pitaria,who is an ex-IIT BHU, IIM Calcutta, with 10+ years of experience in Product Strategy, Management and Development and having experience as ex- Bajaj Capital, Magicbricks,, Infosys (Finacle), have come up with some concrete solutions.

In an exclusive interview with BusinessWorldDossier journalist, he shares his vision. The details of the interaction are as below:

1.       What is the problem BizFinn trying to solve ?

BizFinn aims to solve the cash flow problem for small and medium-sized enterprises (SMEs) and startups. This problem is a significant factor in why many businesses shut down. There are several reasons behind this issue, such as delayed payments from clients, longer turnaround times between purchasing raw materials and making sales, poor cash flow management, and a lack of affordable financing options.

To tackle this problem, we have adopted a two-pronged approach. Firstly, we offer a business management tool that provides visibility into a business’s cash flows. This tool enables businesses to manage their finances better, which in turn will help them to avoid cash flow problems.

Secondly, we also provide financing solutions for the liquidity gap based on the nature of the business. We offer several different solutions such as a revolving credit line, invoice discounting, short-term working capital loans, revenue-based financing, and exports financing. One of the main benefits of these solutions is that they are collateral-free, which can be a significant advantage for startups and SMEs that may not have assets to offer as collateral.

In summary, BizFinn aims to help SMEs and startups overcome the cash flow problem by providing them with a business management tool to better manage their finances and a range of financing solutions to bridge the liquidity gap.

2.       Who is the target audience for your brand?

The target market for BizFinn is small and medium businesses operating in India, with an annual turnover of over INR 5 crores. These businesses often struggle to access appropriate financing options from banks and may not have enough collateral to secure loans. We are sector-agnostic, with the exception of a few sectors like real estate.

In the future, we plan to expand our services to include micro-enterprises with lower annual turnover. This move will broaden our target audience and allow us to reach even more businesses that struggle with cash flow problems.

Overall, BizFinn’s target audience is businesses that are looking for financing options to bridge their liquidity gap. By offering tailored solutions that are collateral-free, BizFinn aims to help businesses overcome these challenges and thrive.

3.       How did you get the idea and how long have you been up and running?

This is a very interesting question. The idea for BizFinn was born out of our experience in our previous startup.

I joined my cofounder Rachit in his previous startup two years ago, where we were helping MSMEs and startups with growth consulting. And it was here, that we noticed the problem, as every second client was coming to us for helping them with financing also even if we were not providing that service/solution. This led us to do further research to understand the scale and root causes of the problem. We then worked on developing tailored solutions to address the cash flow problem faced by small and medium businesses.

We have been working on this venture for over a year, facing new challenges each day, but also experiencing great excitement as we overcome these challenges.

4.       What is the growth potential you see?

BizFinn has a significant growth potential in the Indian market, given the large number of small and medium businesses that are facing cash flow problems. According to a recent report by the Ministry of Micro, Small and Medium Enterprises (MSMEs), there are around 6.33 crore MSMEs in India, which provide employment to over 11 crore people.

With a significant portion of these businesses facing cash flow challenges, BizFinn’s solutions can address a pressing need in the market. Additionally, the Indian government has recently launched several initiatives to support the growth of the MSME sector, which is expected to further fuel the growth of businesses in this space.

Overall, with a large and growing target audience, a pressing need for their credit requirements, and a supportive policy environment, BizFinn has significant growth potential in the Indian market.

5.       Message to aspiring entrepreneurs

While BizFinn is still on its growth trajectory, as an entrepreneur, I would like to share a few tips to aspiring entrepreneurs before they take the plunge.

First and foremost, entrepreneurship is hard, and it takes time to build something valuable from scratch. Be prepared for a long haul and understand that there will be many failures and rejections along the way. Having the right mindset is crucial.

Having a good support system can also make the journey easier. Find a few good mentors, friends, and family members whom you can share everything with and seek guidance and support.

When starting up, don’t try to do too many things at once. Narrow down your business idea to one or two essential things, and focus on cracking those first before moving on to other things. Reach out to your target customers as soon as possible to get early feedback and valuable insights.

Lastly, entrepreneurship is a journey full of new experiences. Keep an open mind, enjoy the journey, and appreciate even the smallest of successes.

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