Several leading brands rely on bVerify to simplify the diligence process—cutting franchisee approval time in half while accelerating financing.
BoeFly, the online loan marketplace that matches prospective and existing business owners with an array of participating banks and financing companies, has supported $6.7 billion worth of transactions since 2010. In recent years, the service has pivoted from solely focusing on helping franchisees access capital to also helping franchisors optimize franchise sales. It’s no wonder BoeFly is seriously shaking up the franchise sales process.
BoeFly’s suite of three franchise sales and financing services includes bQual, which educates a franchisee on their financial status; bFinance, in which a dedicated expert delivers efficient, competitive financing for franchisees; and bVerify, an asset verification, background and credit check service that drastically accelerates applicant approval times—and therefore franchise sales and start-up times.
“BoeFly’s core business is helping franchisees with financing. Through seeing how the franchise sale process works firsthand, we learned how franchisors were vetting applicants, and decided they could use some help,” explained Mike Rozman, CEO and co-founder of BoeFly.
Through bVerify, industry leaders like Driven Brands, BrightStar Care and Checkers and Rally’s have outsourced their new franchisee vetting processes to BoeFly. “A client will send a new franchise applicant an introductory email that explains there’s an important next step to move forward, which is the diligence process,” explained Rozman. “Then the franchisor sends the franchise applicant to us.”
BoeFly takes on the responsibility of performing the background check and credit check, verifying liquidity and confirming the net worth of applicants. BoeFly then prepares a summary report for the franchisor.
“The vetting process historically was done by someone at the brand in sales, finance, or legal—someone who honestly has better things to do with their time than chase down bank statements,” said Rozman. “This added efficiency in a crucial process unlocks a lot of value.”
“Checkers and Rally’s has been a long-term fan of BoeFly. While we receive many inquiries from prospective franchisees, BoeFly has worked with us to offer efficiency,” Jennifer Durham, Chief Development Officer at Checkers and Rally’s wrote in an email. “Our sales team can address questions rather than chasing applicant documents.”
The results BoeFly provides franchise clients have been undeniable.
“Time kills deals. Since adopting BoeFly’s diligence service, we’ve cut weeks from the sales timeline,” said Jon Gaiman, Chief Development Officer at Driven Brands. Before using BoeFly, Driven Brands would take an average of 62 days to approve franchisees; with BoeFly, the time was cut in half to 31 days.
BoeFly’s approach brings an elevated level of rigor to the vetting process. Through a partnership with the Customer Relationship Management (CRM) software FranConnect, bVerify folds convenient integration and data security into the diligence process.
“Too often, an applicant will email the franchise salesperson their bank statements,” explained Rozman. “That information may sit on the salesperson’s hard drive, which is not a great place to store sensitive data. Because we believe that franchising is a multi-step process, BoeFly has invested a lot of careful attention into how the data flows and is stored.”
“BoeFly provides excellent data security and provides secure cloud-based storage which is designed to protect franchisee's sensitive asset statements through a secure upload link,” added Durham.
FranConnect also helps BoeFly keep information organized and compliant with all regulations. “I worry that not enough brands are thinking about information security and privacy,” said Rozman. “The Fair Credit Reporting Act is a federal law, and it’s a giant ball of wax. I can’t tell you how many times I’ve spoken with a franchisor who says they do a criminal background check on applicants in the same way as they do for new employees. But those two processes have two different sets of rules.”
“FranConnect has been very pleased with its successful strategic partnership with BoeFly,” Keith Gerson, President of FranConnect wrote in an email. “Our customers use FranConnect’s automated workflows to execute bVerify, which our customers indicate helps achieve greater efficiencies and improved closing rates. We all know time kills deals, so having extremely fast financial pre-approval of applicants early in the sales process gives the prospect confidence that they can turn their hopes into reality, and the franchise sales team can be assured they aren’t wasting time with someone who can’t get over the finish line. And anything that frees up the sales team from having to chase applicants documents can allow more time for selling.”
Because bVerify is compliant with regulations, saves time and resources, and results in faster sales, it also accelerates start-up periods thanks to BoeFly’s integrated suite of financing services.
“BoeFly provides quicker access to capital,” wrote Durham. “Through a quick bVerify process, powered by BoeFly, franchise prospects secure early-stage financing options.”
“We’ve been able to, with the applicant’s approval, take a completed diligence report and use it to accelerate financing offers for the franchise applicant,” said Rozman. “Our bVerify service answers the franchisor’s internal questions about the applicant’s wherewithal, and we can leverage the output to secure lender issued financing offers to speed up the sale process and the store opening.”
On June 3, 2019, ConnectOne Bancorp, Inc. (Nasdaq: CNOB), parent to ConnectOne Bank, announced that it acquired BoeFly. ConnectOne Bank is a $6 billion bank offering a full suite of both commercial and consumer banking and lending products. ConnectOne sees BoeFly as important to their digital strategy.
“Similar to ConnectOne, BoeFly is built on a mission of offering frictionless, efficient solutions for small to midsized businesses, and this partnership represents a unique opportunity to leverage the digital foundation we have built,” said Frank Sorrentino, ConnectOne’s Chairman and Chief Executive Officer.
“The transaction with ConnectOne puts us in a meaningfully stronger position to serve our clients and to continue to develop client-centric solutions like bVerify,” said Rozman.