Small Business
In the beginningIn 1997, future Ibank founder Thomas Markel was approached by the largest private hotel owner in the United States, Gary Tharaldson, to restructure the debt on his hotels. The restructuring deal was enormous - almost 300 hotels, each with their own loan held by their own lender, totaling $400 million. Mr. Tharaldson wanted to consolidate all of this debt into one loan with a single lender. Mr. Markel ultimately restructured the deal with Goldman Sachs. The end result of Mr. Markel's hard work was a single consolidated loan with a savings of two hundred basis points (2%) over the existing loans, netting Mr. Tharaldson a savings of $100 million over 10 years. A huge business problem uncoveredDuring his time assembling and condensing loan packages on almost 300 properties into one loan package for distribution to forty lenders, Mr. Markel was awe struck by the mountainous costs and inefficiencies associated with the task. Not including the value of his time, the costs associated with the restructuring deal included:
iBank: A solution is bornWith the proceeds from the successful restructuring deal, Mr. Markel was inspired to launch a new business which would enable companies of all sizes to store and organize their business data into a secure electronic "vault" for the purpose of arranging financing to help them grow their business and reduce their costs. The customer can then provide access to this vault to selected lenders, credit rating agencies, brokers and other parties as necessary, thereby eliminating the inefficiencies and costs of typical paper-based transactions like the consolidation loan for Mr. Tharaldson. The transaction described above cost approximately $37,000. This same transaction through Ibank today would cost $1,750 - a savings of over $35,250! |
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