Caary Capital wants to build a new kind of financial relationship with businesses in Canada, one that focuses on cash flow and assets, not credit history.

They do this through a corporate credit card secured through Mastercard. Business owners can order and assign virtual cards to their staff, setting spending limits and expiry dates on the cards, as well as earn 1.5% cash back for transactions on all the cards that business owner has. There is no credit check, no annual fee, plus no-personal guarantee, meaning the business owner will not be required to repay credit using their personal credit or assets. They aim to serve small-to-medium businesses (SMBs) with $1M to $50M in revenue. A minimum of a $35,000 balance in a business bank account is required to be approved.

A similar model can be seen in the U.S. with companies like Brex, while Canadian companies like Neo Financial and Brim Financial are also making their presence known in the credit card market that is currently dominated by big banks.

After a recent launch in Toronto, STOREYS caught up with Caary Capital CEO, John MacKinlay, to learn more about how the start-up could help real estate developers and brokers, too.

MacKinlay, who assumed the role at Caary in 2021 after leading strategy for companies like IBM and PwC, says real estate is one of their target industries, noting that, like big banks, there are large property management organizations which hold a tight grip on the industry.

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“The ability for smaller developers who are more rural than urban to access credit is challenged, and then the trades that sit under that ecosystem, it’s very fragmented,” says MacKinlay.

Currently, there are 100 clients using Caary’s platform including companies in real estate development, construction, and the renovations sector.

“From the development side, being able to manage budgets within an umbrella credit limit is good,” says MacKinlay. “Plus, property managers can create cards for different properties, where a physical or virtual card would then give you a different cut of the data for how you are tracking against budgets.”

Cards can be programmed to only be used at a certain location (i.e., Home Depot), or certain demographic to help streamline costs.

Caary has shifted the accreditation approach to look more at how long a business has been running, the cash flow—what’s coming in and going out in terms of payments—and the assets under management (AUM), so the total market value of assets a business manages on behalf of others. They use their own proprietary risk management system to perform risk scoring and determine eligibility and credit limits.

“We have the visibility of their month-to-month spending and their bank balance, so we can comfortably offer loans,” says MacKinlay. “It’s not just access to credit, as in here you go spend it as you will. We’ve embedded tools to help you manage things.”

“You can have both physical and virtual cards for staff with specific expenses, allocating spending controls, like $50,000 for a marketing budget, and sync to broader budgets,” says MacKinlay, adding that they provide and extend loans to get cash flow, which helps when buying equipment, materials, or other capital goods. 

MacKinlay also thinks the brokerage and realtor industry could benefit.

“Each realtor has their own corporation they’re attached to, so it’s very rare, from what I understand, to secure corporate cards, and if they do secure one, it is backed by a personal guarantee, so all their spend is going against that personal guarantee,” says MacKinlay. “Having access without that is good for incorporated realtors.”

Caary has raised CA$21.5M to date, with its next raise set at USD$30-35M. They currently serve all Canadian provinces except Quebec, which they plan to “in the near future.”

“In an industry like real estate, which is very project oriented with a lot of spend per project, the ability to control and manage that spend is important and what we’re trying to help with,” says MacKinlay. “It’s a huge part of the value proposition."

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