One of the critical factors for success of Industry in any economy is easy availability of capital. The high NPAs in the Indian banking system have made banks cautious about lending. Also, the lending norms vary between large corporate mid-market companies and SMEs owing to the difference in risk profile and other credit parameters. Add to this a lack of understanding of banking requirements and that in a snapshot summarizes the challenge mid-market company’s face in raising capital for new projects.
Clip Financial was founded by Chirag Mehta in 2013. He is an IIM Lucknow graduate and an investment Banker with more than 500 Mn USD worth of transaction experience in his career spanning over a decade.
Having worked with many large MNCs he understood the impact a good Tier 1 Investment Bank can make to the outcome of a financial transaction. However many corporates struggle to get adequate financial advice and juggle between multiple advisors, many of who are not equipped to advice on such matters. This realization led to the formation of Clip Financial.
Mr. Chirag Mehta says “When we looked at the term sheets of some of our clients we were surprised at the terms they had signed up. In most cases it was the obvious issues like high rate of interest or high collateral request whereas in some cases it was the fine line relating to pre-payment penalty, processing charges etc. which could have been better negotiated. It further confirmed our belief that many companies need adequate representation to enable them to negotiate a more favorable deal with financial institutes.”
In just three years of its operation, Clip Financial has expanded and set up
offices in Delhi and Rajasthan. Currently they are working in large cities like Mumbai, NCR etc. and also in Tier 1 and 2 cities of Rajasthan like Jaipur, Udaipur, Kota, Bhilwara.
Challenges faced in the beginning
Clip Financial believes in a strategy of “inch wide and mile deep”; rather than trying to be everything to everyone, they are focusing on specific sectors and services
Initially promoters were hesitant to look beyond their immediate circle of friends and family and entrust the responsibility of such a strategic activity to an “outside” organization.
However with the economy still struggling and credit availability remaining scarce, promoters are exploring alternatives to the traditional approach of doing business. In many cases the next generation in the family has started to get involved in the business. These are young people who having studied and travelled across the globe and are aware of international best practices. They are increasingly seeking professional advice and are radically restructuring the organization with the help of advisors like Clip Financial.
Clip Financial is laser focused on fund raising and corporate advisory. The company believes in a strategy of “inch wide and mile deep”; rather than trying to be everything for everyone, they are focusing on specific sectors and services. Currently they offer debt syndication in the form of Project Loans and Equity Funding from PEs and VC sin select sectors like Real Estate, Hospitality, Renewal Energy, Manufacturing, Technology, Healthcare and Education.
Going ahead, Clip Financial wants to continue this journey and position itself as a niche dealmaker for its clients. As part of business expansion, Clip Financial is shortly opening its first international office in Dubai to facilitate transactions for its clients in the Middle East market.