[Issuer] Harbor Trade Credit

About

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Harbor Trade Credit works with importers, manufacturers, wholesalers, distributors and brands providing trade finance programs to create liquidity throughout the supply chain.

Questionnaire

(note: this questionnaire has not been altered. Answers come directly from the Asset Originator)

Company

Please give a brief history of the company and, if applicable, group structure.

Founded in May 2018, Harbor is a FinTech firm focusing on Supply Chain Finance (SCF) and working capital solutions to improve the cash conversion cycle. Harbor’s programs allow for early payments to suppliers so that buyers can optimize their own liquidity through trade credit. These programs are administered on Harbor’s proprietary platform which not only injects liquidity into the supply chain, but it allows for better vendor and procurement management.

Organization

How many full-time equivalent team members do you have and what do they do?

Harbor currently has 4 full time staff and 5 part time contractors. Full time staff includes Business Development, product & technology development, structuring and deal execution. Part time staff are DevOps, sales and marketing.

Have you sold equity? Are you venture funded, if so please describe the previous rounds, money invested, and lead investors.

No. Harbor has been capitalized by its founder, Bryan Maloney.

Is your business sustainably profitable or well funded with sufficient cash runway?

Yes. Our projections/budget give us a conservative runway of 12 months which assumes zero revenue (cash burn).

Asset Details

Describe the asset collateral that you seek to finance.

The funding vehicle (SPV) under this SCF program will purchase short term trade receivables from Harbor Trade Credit, payable by Buyers at a 60-day maturity. Harbor will pay the cost of goods directly to the supplier upon shipment of the good. HTC’s solution allows the Buyer to have an extended payment period while financing the supplier earlier in the process.

Describe your previous track record related to this business proposal.

No answer

What is the average collateral asset size?

~250K

Describe the risk of the assets you are proposing. How do you evaluate and manage that risk?

HTC works with Buyers to finance Suppliers. As a result, HTC minimizes Supplier invoice fraud by aligning with the Buyer. HTC has Buyer default risk, which is mitigated by the length of relationship between Buyer and Supplier as well as HTC’s credit underwriting process on buyer counterparty risk. The historical industry average buyer default rate is less than 1%.

Disclosures

Please describe any conflicts of interest or potential conflicts of interest or any relationship that could compromise or be viewed to compromise the decision making of the company.

None

Are there or have there in the last 10 years, been any criminal, civil, regulatory or administrative proceedings against (i) the Company or any of its principals or (ii) the product in any similar such matters including reparations, arbitrations, and negotiated settlements? If so, please describe.

None

Are there any further disclosures that interested party should be aware of?

None


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To our investors:

The first maturities under our Supply Chain Finance program with Snakebyte have been settled within term.

We expect to make distributions to investors on October 28th.

Thank you for your support and we look forward to working together on a revolving program with Snakebyte and others. We have several interesting programs in the pipeline.

Feel free to contact me directly with any questions or comments.

Bryan Maloney, CEO Harbor
B.maloney@harbortradecredit.com

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Dear Investors,

We regularly create content and post across multiple channels and our website. Check out our new section to learn more about Harbor, trade finance and trends in international trade.

https://www.linkedin.com/company/harbor-trade-credit

Bryan Maloney

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Dear Investors,

We had a successful launch of HTC2 last week, which was oversubscribed. We will be opening the pool back up for investment later this week to finance additional Snakebyte procurement. Here is a sneak peak of the Honeycomb Aeronautical Bravo Throttle Quadrant in production and testing.

https://vimeo.com/497335802/a06629cb33

Regards,

Bryan Maloney, CEO Harbor
B.maloney@harbortradecredit.com

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Harbor Investors,

As we approach the 2nd Quarter of the year, I am reaching out to provide you with some details on our projections for next quarter.

First of all, I want to thank you all for your interest and investment in Harbor’s Supply Chain Finance. We have had a huge response in Q1 and the pool is consistently oversubscribed.

We expect to open the pool for investment over the next two weeks with a target pool size of $3,000,000 USD equivalent as we originate more assets for the fund. Please feel free to reach out to investors@harbortradecredit.com with any questions related to investing in HTC2.

Bryan Maloney, CEO

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Hi Bryan,

Do we have any expected date for pool to open? I assume once it opens, it will be non-over subscribed.

Thanks
Regards
Pats

We expect to open the pool later this week or possibly Monday/Tuesday of next week. The pool will be oversubscribed once we reach our target but as we originate assets we will periodically open the pool for new investment.

Bryan Maloney

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Thanks for your response. Looking forward to it.

Regards
Pats

It says in the executive summary that “Both Harbor and Centrifuge will purchase a portion of the TIN Tokens to demonstrate their confidence in the asset pool and to act as a buffer against losses to investors in the DROP Tokens.” How much have Harbor and Centrifuge committed to HTC Series 2 respectively?

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Dear Investors,

As we prepare for MakerDao’s MCD inclusion at the end of this month, we want to provide you with some updates and projections on our fund.

As you know, we launched HTC1 in August 2020 on a pilot basis with our client Snakebyte. This pilot was a proof-of-concept exercise for 65 days. Funds were returned to investors once the assets were paid at their maturity date.

In September 2020, Harbor was greenlit by the MakerDao community for MCD inclusion.

As a result, in December 2021 we launched HTC2 with the objective of building a diversified pool of trade receivables originated through Harbor’s Supply Chain Finance program. The strategy is to provide investors with healthy, risk adjusted return uncorrelated with traditional markets.

Maker’s line of credit is on track for a May 28, 2021 closing date, providing Harbor and our investors with additional liquidity and allowing us to grow and diversify the pool. Our target for the end of 2021 is to reach $15mm AUM. Maker’s leverage will allow Harbor to offer competitive rates to corporate clients. Going forward the DROP yield will be set at 7.00% with a target TIN yield of 15%. As a result, investors will be given the opportunity to invest in both tranches at a 90/10 ratio to achieve a higher target yield. This will be reserved for investments of 100,000 DAI or more (90,000 DROP and 10,000 TIN).

Our portfolio management strategy is a mix of internal origination as well as participation in partner programs and syndicated programs managed on Harbor’s HarborTrade platform. This strategy allows us to diversify the allocation of the fund through syndications with other participants in larger trade finance programs. (i.e., larger corporate client segment)

Portfolio allocation will be available to investors on a regular basis which will include information on the underlying obligors in the pool. This will be included in the executive summary on Tinlake.

Thank you for your support and investing in Harbor. If there are any questions or comments, please do not hesitate to contact us at investors@harbortradecredit.com.

Bryan Maloney

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Hey Bryan, is there a way to get notified about new opens? Thanks!

@LeGo You can sign up to our notifications list here:http://eepurl.com/hw9GyP

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HTC2 Open for Investment

Harbor Trade Credit (Series 2) is currently open for new and existing investors.
DROP APR: 7.00%
Minimum Investment Amount: 5,000 DAI
Target Raise: 2,000,000 DAI
Available to U.S. accredited investors and non-U.S. persons.

HTC2 is now open to investors looking to allocate funds towards the TIN tranche (junior). This will be reserved for investments of 100,000 DAI or more. Please contact investors@harbortradecredit.com to inquire about investing in TIN.

Pool Updates

For the second half of 2021 we expect to grow the AUM by 15,000,000 DAI. This will be supported by MakerDao’s direct investment in Harbor which provides the pool and its investors with additional liquidity and reduces cash drag. This is a great pool management tool and creates operational efficiencies. After some technical delays, we are on track to close this deal with Maker by mid-July.

Our portfolio management strategy is a mix of internal origination as well as participation in partner programs and syndicated programs managed on Harbor’s HarborTrade platform. This strategy allows us to diversify the allocation of the fund through syndications with other participants in larger trade finance programs (i.e., larger corporate client segment).

Portfolio allocation will be available to investors on a regular basis which will include information on the underlying obligors in the pool. This will be included in the executive summary on Tinlake.

Thank you for your support and investing in Harbor. If there are any questions or comments, please do not hesitate to contact us at investors@harbortradecredit.com.

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Congratulations!

Also great to see cutting edge Fintech integrating with DeFi.

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Harbor Raises Funds From MakerDAO Unlocking DeFi’s Full Potential in Trade Finance

Harbor continues to be a first mover in utilizing DeFi liquidity to finance global trade

Harbor is pleased to announce we have raised funds from MakerDAO to finance global trade using decentralized finance (DeFi) liquidity. MakerDAO is investing in Harbor’s portfolio by providing a line of credit backed by a securitization pool of trade receivables.

Harbor securitizes and tokenizes trade receivables by integrating with Tinlake, the protocol powered by Centrifuge which facilitates the on-chain securitization process and investor relations. The fund is structured with a senior and junior tranche called DROP and TIN. Investors subscribing to the fund receive DROP and TIN tokens which represent their stake in the pool and a daily NAV calculation is provided.

An innovative fintech that began embracing DeFi in its infrastructure in 2020, Harbor’s core focus is to provide working capital in international markets through trade finance.

HTC2 is also open for investors looking to allocate funds towards the TIN tranche (junior). This will be reserved for investments of 100,000 DAI or more. Please contact investors@harbortradecredit.com to inquire about investing in TIN.

Harbor Pool Updates

For the second half of 2021 we expect to grow the AUM by 15,000,000 DAI. This will be supported by MakerDAO’s direct investment in Harbor which provides the pool and its investors with additional liquidity and reduces cash drag. This is a great pool management tool and creates operational efficiencies.

Our portfolio management strategy is a mix of internal origination as well as participation in partner programs and syndicated programs managed on our HarborTrade platform. This strategy allows us to diversify the allocation of the fund through syndications with other participants in larger trade finance programs (i.e., larger corporate client segment).

Portfolio allocation will be available to investors on a regular basis which will include information on the underlying obligors in the pool. This will be included on the Tinlake UI.

Thank you for your support and investing in Harbor. If there are any questions or comments, please do not hesitate to contact us.

Harbor on Tinlake

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Harbor Brings on Head of Portfolio Management

Harbor Welcomes New Team Member
Michael Gilhuley, Head of Portfolio Management

With a foundation in credit, both structured and corporate, combined with experience originating and structuring complex structured finance transactions, Mike Gilhuley will oversee Harbor’s trade finance portfolio.

Mike’s background includes originating and providing structured trade solutions to Citibank clients globally, primarily in the channel finance sector. Prior to this he was active in the securitization market originating asset-based loans for the NY branch of WestLB.

Most recently, Mike served as the Managing Director of Greensill, leading the Americas and driving business from $100 million in assets to over $4 billion during his tenure.
Mike holds a Bachelor of Arts from Ohio Wesleyan University.

Harbor Pool Updates

Harbor recently closed on a supply chain finance program for an injection molding facility in Mexico. Harbor’s program will allow the business to procure goods from their international suppliers on credit to better manage their working capital.

Working capital management is currently of heightened concern for businesses that trade internationally as slow shipping speeds due to Covid-related container shortages and port closures have caused major delays to production schedules and sales.

Soaring freight costs are also to blame for the current hostile global trade environment. In addition, production capacity is down due to Covid-related restrictions in petrochemical hubs like China and Thailand. Recent inclement weather in Louisiana and Texas is another cause for supply shortages and rising prices.

With Harbor’s supply chain finance program in place, suppliers are paid at shipment and the buyer is given extended terms, injecting liquidity into the supply chain.

HTC2 is open for investors looking to allocate funds towards the TIN tranche (junior). This will be reserved for investments of 100,000 DAI or more. Please contact investors@harbortrade.com to inquire about investing in TIN.

Portfolio allocation will be available to investors on a regular basis which will include information on the underlying obligors in the pool. This will be included on the Tinlake UI. Harbor will periodically distribute press releases, company news and portfolio updates to registered investors on Tinklake.

Thank you for your support and investing in Harbor. If there are any questions or comments, please do not hesitate to contact us.

Harbor on Tinlake

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Congratulations on hiring Michael! He seems like a great match for the team. Very impressive. When do you start drawing capital from Maker?

Thanks @thedoctor_j, he is a great addition to the team and will be contributing to our overall portfolio and risk management strategy. We’re expecting a ramp up in October and will be drawing from Maker. More updates in the coming weeks.

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