ApplePie Capital, a new marketplace lender that specializes in lending to franchises, has officially opened for business.
The San Francisco startup closed its seed round of initial funding in July after raising $3.8 million from venture capital investors such as Freestyle Capital, QED Investors, and Signia Venture Partners. It completed its first loan this week and has secured partnerships with seven franchise chains ranging from salons to jewelry repair to pizza.
"We're completely focused on the franchise industry," co-founder and Chief Executive Officer Denise Thomas said in an interview, adding that franchisees will typically be referred to ApplePie by the parent company.
Thomas has a history in seeding successful franchises: her family invested in the salon chain Supercuts in the 1990s. She said she saw a need for franchise lending as many franchisees, like other small-business owners, have struggled to access capital in the aftermath of the financial crisis.
Technically, the loans will be made by $295 million-asset Cross River Bank in Teaneck, N.J., and then purchased by ApplePie after a waiting period of a couple days.