Asset Finance Broker Talks About Finding His Client Niche and Owning It

Matthew Taverner founded Geared Asset Finance in 2008, after several years cutting his teeth in asset finance at banks and a private broking house. Thirteen years and 11 staff members later, his Melbourne-based brokerage is known for servicing clients and industries that are often considered tough to finance. He talks about a challenging deal assisting a genome sequencing research organisation, and how brokers can educate their clients and find more business thanks to the latest Federal Budget.

Tell us your story. How did you get into broking?

After completing a bachelor’s degree in finance and economics, and keen to start making money, I accepted a role with ANZ Bank in their asset finance division.

Over the next few years, I learned everything about the industry from documents and settlements, credit analysis through to client management and sales. The bank environment was a great place to learn the structure, process and professionalism around the industry, but the regimented, slow-moving processes of a bank where the culture did not necessarily foster individual autonomy and creativity started to weigh on my commitment to the organisation.

Through my next stint with a large asset finance company that dealt with external referral partners, I discovered the role of an asset finance broker who introduced business to us. The concept of these individuals still working within the industry that I had grown to love, while having their own autonomy and the ability to create their own businesses was exactly what I was looking for! I then moved to work in setting up a local divisional office for a national broking firm where I learned everything about how brokers juggle the diverse lending options of other banks and financiers. Within a few years, the thought, ‘I could do this for myself’, kept getting stronger to the point where I started my own broking business and the rest was history. We have now operated for 13 years with 11 staff and service happy clients across many industries.

What kind of clients do you usually work with and/or industries do you specialise in?

We focus a lot on the industries that other brokers may view as challenging to finance – in terms of the types of businesses and the equipment that they want financed. Those “tertiary” types of equipment, which include IT and office equipment, software, and generally specialised assets that are not the preference for many banks and financiers. This makes it not only a challenge for clients to find funding solutions, but also for us as brokers.

Sometimes solutions can be relatively difficult to piece together, but when we are able to provide a comprehensive result for the customer, the hard work is worth it. With our focus in this area, we very often have customers coming to us who are unable to find solutions elsewhere and unsure where to go. We have managed to specialise in finding solutions for these difficult situations and help many clients through challenging acquisitions.

Can you tell us about the most interesting or challenging deal you've worked on in the last year and how you resolved it?

We recently assisted a genome sequencing research organisation with a significant IT server spend to upgrade from their old data storage system. As a not-for-profit organisation with numerous professional directors, who were not willing to provide directors’ guarantees and wanting to finance tertiary related equipment, there were limited funding options available to assist. They already had trouble with approaching their bank and another funder due to a limited appetite for that extent of equipment, which banks generally view as an unsecured lend. We were able to come to the table and provide a flexible and competitive solution for the client allowing them to move forward with their purchase and look to the future for further growth.

EOFY is fast approaching. What do you do in your business to end the year off right and set yourself up for success in FY22?

Finance in our industry is very cyclical with clear ups and downs across the calendar year. We are very aware that we need to make hay while the sun shines, so it’s important for us to work as hard as we can to finish the financial year off with a bang. EOFY is generally one of our peak periods where we need to have all hands on deck to best service our clients when they need it. The preparation that we take includes notifying our customers of relevant points that may affect them coming up to the end of financial year and encouraging them to make the most of these.

As a team, our levels of communication between funders and clients generally increase to be sure we are aware of upcoming deadlines and cut-offs, so that we can deliver a client’s solution within the end of financial year deadline! Having a good EOFY then clearly sets us up for a good run through to Christmas, which inevitably ends up being our other busy period.

What are your business goals for the coming financial year?

Through the last year and a half dealing with COVID and the consequences from that, much of the year ahead is working to build and strengthen in the areas that we have traditionally focused. A strong component of our business is working with our referral partners and through the course of the last year, we have invested significantly to improve the way that we do that.

Our online capabilities have been beefed up, so that we can keep up to pace with the changing technology and ways that businesses now relate to their partners, including financiers and brokers. This action and planning has led us to aim for 15-20% growth in the coming year while we improve on the way that we work with our existing referral partners and expand the opportunities with new relationships across the board.

The government recently announced some changes and a big extension to the instant asset tax write-off. How do you plan to leverage this to acquire more business?

The instant asset tax write-off is a strong motivator for businesses to either bring forward capital purchases or consider investing in additional and replacement equipment to take advantage of some significant tax incentives.

As a business, it is important for us to get the message out to our clients as much as we can so that they better understand the potential of utilising the write off. Through our regular email marketing and social media presence, we focus on talking to our existing clients and also the base of potential new customers that are within our industry and equipment type focus.

Sharing an actual client’s experience around a purchase and their circumstances when considering the impact of utilising the instant tax write off in combination with finance, helps other businesses to better relate to a real-world example. A simple and relatable message can sometimes be what’s needed to spark a client’s chain of thought to call them to action. For clients where the circumstances are right and if they adequately consult their accountant on how they are looking for the coming EOFY or those ahead, utilising finance to fund the acquisition of a new capital item can make a world of difference from a taxation perspective.

Was there anything else in the latest Federal Budget that you think will affect your broking business?

The extension of the SME Guarantee Scheme may help businesses to access further degrees of funding through banks and some approved lenders. While this is seen as a low-cost effective source of funds for businesses as an alternative to other funding solutions in the market, there may be situations where businesses cannot adequately access these funds with the pace and ease that they may require.

If a business needs to act quickly on a purchase that clearly provides the desired levels of return for that operator, but which needs to done quickly and without hassle, a finance broker may be able to recommend the best funding solution for that business. This may be an SME Guarantee Scheme loan or potentially another facility that provides the business with ease and speed, so having conversations with clients to discuss these scenarios is very important.

How has Connective Asset Finance helped you grow your business over the years? What tools/services have been the most valuable?

As a business that focuses on many smaller ticket transactions, we don’t necessarily reach the total lending volumes that other brokers may get to when funding larger, higher value pieces of equipment. This can naturally prevent us from having access to more mainstream banks and lenders who demand minimum lending volumes. Connective Asset Finance has allowed us to vastly expand our lending panel and provide a more comprehensive solution for all our clients.

As we all know, we may start off our client relationship with a very specific transaction for a particular type of equipment, but often these lead into a more traditional asset finance requirement – such as a car. Our ability to up-sell back to our clients’ needs after our initial encounter has improved dramatically through our Connective Asset Finance membership, as we can now confidently provide funding for almost any piece of equipment that our clients may need.

Describe your ideal Sunday

Sunday is definitely a family day in our house! My ideal Sunday is not having to get out of bed at the crack of dawn and potentially having breakfast at the local café with our two children. If my wife and I have managed to sufficiently get our work done through the week, we can typically use Sunday as our unplanned day to just relax and perhaps catch up on some housework!