Equipment finance service provider Syndifi and Tamarack Technology announced a partnership to improve equipment lenders’ capital market access through their combined syndication platform.
As access to capital remains tight in the equipment finance industry — and throughout the wider economy — amid high interest rates, demand for syndication continues to increase, Tamarack President and Chief Technology Officer Scott Nelson told Equipment Finance News.
The ability to access the syndication market is a key tool for lenders seeking to maintain, or even grow originations and customer and dealer relationships.
“We saw an increased demand for [syndication] because of the high interest rates changing the behaviors of the funders, primarily banks,” Nelson said. “The banks pulled out, and so a lot of independents needed to engage other funders, and it’s not surprising anymore, but every funder can ask for a different data tape sometimes.”
A data tape is a data file that represents a snapshot of a company’s data and staging for equipment finance.
The companies plan to combine Syndifi’s syndication platform with Tamarack’s SyndicationBuilder, as well as continue to develop product enhancements and pursue customer applications, Syndifi President Alistair Canal told EFN.
Through the partnership’s combined services, users gain access to a more effective and holistic solution, Canal said.
“As technology companies try to emulate one another’s products and build things that are enough of a tool that can pull people away, it’s not the effective way to go,” he said. “The effective way to go is: Who’s got special skills, products and solutions that they’re delivering to the industry, and how can we complement?”
“The wide receiver isn’t always the linebacker,” Canal said.
Creating the ecosystem
With Syndifi and Tamarack both looking to improve their loan syndication technologies, the partnership facilitated a more efficient system for customers, Canal said.
“They had a great product that enabled some great analytics, some great visibility for their pools, and we had a really good tool that helps them package that, share it and sell it, with their users,” he said. “Syndifi has 700 buyers on our platform and about 20 or so sellers on our platforms who are a nice community that we’re building, but it’s all about creating an efficient workflow and an efficient and easy-to-use ecosystem that makes good sense for everybody that’s trying to get involved.”
Customers on the Syndifi platform include 36th Street Capital, Greenwoods Equipment Finance, Nexseer Capital and Verdant Commercial Capital, according to Syndifi’s website.
Meanwhile, syndication also creates the potential ecosystem for lenders to enter the securitization side of capital markets, Tamarack’s Nelson said.
“Our joint customers get better and more efficient at syndication, and get to the point where, if they want, they can jump to securitization, because for me, securitization looks like a transition of maturity for a finance company,” he said. “They’re getting big enough and strong enough to do securitizations, and now you’re recycling the capital $200 [million] and $300 million at a time.”
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