Platinum Bank announced its year-end SBA 7(a) loan volume for the fiscal year ending September 20, 2024: approximately $67.5 million, originating $35.9 million of that in franchise loans. Platinum Bank is a regional business bank based in Minneapolis. It launched a national franchise program in 2023.
“The sector offers the most opportunity for us to grow our SBA lending volume,” said Platinum Chief Credit Officer Jeff Bajek, who leads the SBA group. “We like the SBA product because of its easy ability to help out businesses across the U.S. And some of the most prevalent businesses out there are franchised.”
Platinum originated franchise loans to 22 different franchise brands in 16 different states.
The bank closed $54.7 million in franchise lending since it started the group. Vice President of SBA Lending Tim Smith was hired in 2023 from franchisor Purpose Brands, where he was director of financing.
Tim Smith is the vice president of SBA lending at Platinum Bank.
He realized he missed banking—he’d been with other financial lending companies earlier in his career. Smith was intrigued by Platinum Bank, one of Purpose Brands’ approved lenders for franchisee financing. After initial conversations, talks were elevated to the Platinum management team and “they liked what they saw in me and we hit it off,” he said.
He said his “natural transition” was to bring in business from the industries in which he had been immersed at Purpose Brands. The platform company has concepts such as Anytime Fitness, Waxing the City and the Bar Method, so fitness and health and beauty were natural fits for him.
Now, “we’ve started dabbling in other sectors, which is a natural progression for building our program,” and are even working with some emerging brands, Smith said.
Bajek said they are budgeting $50 million in franchise loans in 2025.
“When I took over SBA, it was a team of one,” said Bajek. “We have grown the team to eight employees, and we are adding another four for fiscal year 2025,” which will help them get to that $50 million goal.
Bajek said their technology, such as a client portal that helps efficiency and makes the process faster and easier for the customer, is one way Platinum is different from other lenders. Plus, Smith brings that human element—customer service is a core value for Platinum—and the experience with franchise businesses.
“I had nearly 17 years with Self Esteem Brands,” said Smith, using Purpose Brands’ former name. “And I spoke to over 4,000 prospective franchisees to help them get organized to get funding. I understand the lending process and what our customers go through.”