Dov Girnun. Picture: SUPPLIED
Dov Girnun. Picture: SUPPLIED

In this edition of the Business Day Spotlight, we talk about how diversifying products, services and lines of business may be useful for business during the Covid-19 pandemic. 

Our host Mudiwa Gavaza is joined by Dov Girnun, CEO of alternative lending company, Merchant Capital. 

The discussion mainly focuses on what Girnun calls the “rise of the generalist”, a notion challenging conventional wisdom that businesses have to specialise if they want to do well. He says Covid-19 has forced many business to change what they do or use their expertise to get into new lines of business. 

Even in their own business, Girnun says they had to change their way of operating. They’ve recently partnered with companies such as Discovery Insure and ventured into new sectors, such as automotive and panel-beating.

Business Day Spotlight host Mudiwa Gavaza. Picture: DOROTHY KGOSI
Business Day Spotlight host Mudiwa Gavaza. Picture: DOROTHY KGOSI

Founded in seven years ago by Girnun and his partner Daniel Moritz, Merchant Capital is a fintech lender specialising in financing small businesses. 

One of the biggest funding issues facing small businesses is the amount of time it takes for bills and payments to be made. Payment terms for supplying services and products, often come with 30-, 60- or 90-day timeframes. This can be especially crippling to a small business that have to wait up to three months to receive money for services rendered, while business expenses continue to fall due.

Girnun says they have so far leant money to about 10,000 small businesses for working capital, having disbursed a total of R2bn over the lifetime of the company.

Merchant Capital competes with other alternative lenders such as Retail Capital and Lulalend, but Girnun says there’s a lot of collaboration between various firms. He says that the problem of small businesses accessing financing from traditional finance services institutions, especially since the 2008 financial crisis, is so big that there’s space for even more players to compete. 

Girnun also talks about Merchant Capital’s business model; the impact of Covid-19 on lending practices and working capital management for businesses; ways in which specialising has been challenged in the economy; advice on how small businesses can adapt to the new times; finding new areas of business; and gives an outlook for small businesses in the current economy. 

For more episodes, click here.

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 Business Day Spotlight is a MultimediaLIVE production.

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