Toronto-based Purpose Financial LP, the parent company of Purpose Investments, announced on Friday that it has reached an agreement to acquire Montreal-based online lender Thinking Capital Financial Corp. for a combination of cash and securities
“Purpose Financial has an unrelenting focus on building innovative, technology-driven financial solutions,” says Som Seif, CEO of Purpose Financial, in a statement. “Thinking Capital is a clear leader in the small- to medium-sized (SME) business lending space, with credit adjudication technology and presence that are unmatched in the Canadian market. This acquisition brings together leading origination, asset management and technology platforms as a unified entity, and enables us to bolster our product capabilities and optimize the technology, distribution and funding model of our combined business.”
Thinking Capital has increased the size of the addressable market for SME credit by delivering more than $750 million in incremental funding to main street since its launch in 2006.
“While 98% of businesses in Canada are small businesses, many have limited access to capital to fund their growth. As an early innovator in this market, we have spent the last decade evolving the language of small businesses credit,” says Jeff Mitelman, CEO and co-founder of Thinking Capital, in a statement. “Under the Purpose Financial umbrella our time to market on product innovation and funding capacity will be greatly amplified.”
Following the completion of the transaction, Thinking Capital will retain its headquarters in Montreal and all employees will remain with the company. Mitelman will become a managing partner of Purpose Financial and will retain a meaningful equity position in Purpose Financial alongside existing investor TorQuest and Thinking Capital’s management.