Timelio-backed shampoo goes from idea to shelves in five months
James Eyers

Shuttered shops all over Melbourne are a bleak reminder of just how tough many small businesses are doing it this year. But entrepreneur Blair James has found inspiration from the lockdown, turning to an SME funding niche – invoice financing – to bring a new product to market in just five months.

“You go in and out of different emotions,” Mr James said of the tumultuous year. “There’s anger. There’s depression at times as well. But I kept telling myself: I have to keep busy.

“I’m a creative person, and my motivation came from not wanting to get stuck in those negative feelings too much.”

Blair James with his new shampoo and Charlotte Petris, co-founder of non-bank lender Temilio.  Josh Robenstone

Next month, 40,000 units of Mr James’ new shampoo, called Growth Bomb, will hit the shelves of Chemist Warehouse and Priceline.

He conceived the new brand only in April and by mid-June, he had convinced the retailers – over Zoom meetings – to stock it. Based on their purchase orders, he was able to secure hundreds of thousands of dollars from fintech lender Timelio to fund the manufacturing process.

“We are all based in Melbourne and this all happened through some of the strictest lockdown period,” Mr James said. An earlier brand he created, Bondi Sands, is a self-tanning sunscreen that can also be found in Priceline and is exported to the United Kingdom, Ireland and New Zealand.

To get Growth Bomb to market inside the retailers’ short window for restocking their haircare range, time was of the essence. Using Timelio avoided the “rigmarole around what the banks would expect”, Mr James said.

“I did speak to the bank, and they offered an overdraft on my personal name. But when I prepared a cost analysis, the better option was Timelio and they were a lot more responsive.”

We had never been properly tested, but the product has held up well from a credit perspective during this time.

— Charlotte Petris, Timelio co-founder

After being set up 5½ years ago, Timelio has just passed $1 billion of loans to small businesses. The average loan size is about $130,000.

Under normal circumstances, it would be operating out of the offices of Thorney Investment Group, one of the funders of its loans, at 55 Collins Street. But for most of the year, its co-founders Andrew and Charlotte Petris have been working from their home in Sandringham.

Ms Petris said the pandemic had helped to prove out the model, which uses purchase orders as security for funding. When Mr James presented the invoices from Chemist Warehouse and Priceline for the shampoo, Timelio funded the loan within days, compared with the weeks or even months it might have taken to get a bank loan.

“We had never been properly tested, but the product has held up well from a credit perspective during this time,” she said. “We haven’t had any direct losses from COVID and, overall, there have been very minimal write-offs. This will help us to access lower-cost funding.”

Timelio’s funding structures meant it did not qualify for support from the Australian Office of Financial Management during the crisis. However, Ms Petris said institutional investors continued to support the Timelio Capital Fund, a unit trust, which is targeting a projected return of between 7 per cent and 8 per cent per annum. Thorney is an investor in the trust.

Timelio recently appointed former FlexiGroup CEO Symon Brewis-Weston as chairman to help execute an aggressive growth strategy, which will increasingly see it target big bank business customers.

Westpac and National Australia Bank offer invoice funding, but their systems are relatively underdeveloped. Ms Petris said in Timelio’s early days it looked for customers who might not tick the credit boxes of major banks, but as it became more mainstream, it would look to attract more customers from banks.

And while it was initially hard to compete on pricing – meaning customer service and speed were everything – new funding facilities being negotiated should help it to compete more aggressively on price.

For other creators stuck at home in Melbourne, Mr James urged them to think positively about opportunities and to “come out of this stronger than how you went into it. Having new things to work on has helped me through this immensely.”

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James Eyers writes on banking, fintech and technology. Based in our Sydney newsroom, James is a former Legal Affairs and Capital editor for the Financial Review Connect with James on Twitter. Email James at jeyers@afr.com.au

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