In January, CAN Capital appointed Edward J. Siciliano as its Chief Executive Officer. As he takes the helm, the industry veteran is developing plans for major change, transforming the 20-year-old technology-driven small business specialty finance company from chiefly a single product firm to one that serves the entire small business market.

Siciliano brings over 30 years of experience in commercial financing, sales, marketing and operations to the post and was most recently with Marlin Business Services, where served in roles including Chief Operating Officer, Interim CEO and Executive Vice President, and Chief Sales Officer. During that time, he was responsible for turning around Marlin post financial crisis by rebuilding the sales force, adding new products, improving operations and driving optimal risk-adjusted returns for all segments, resulting in double-digit ROE and more than fivefold growth in originations.

In late January, Equipment Finance Advisor met with Siciliano to learn more about his vision for CAN Capital, how he views its growth plan unfolding and how equipment financing will fit into that plan in the future.

Equipment Finance Advisor: CAN Capital’s traditional focus has been providing working capital to small businesses. As its new CEO, what is your vision for the company?

Edward Siciliano: There are lot of good things that have happened here and are still happening at CAN. We have a strong foundation to build from because CAN has been an innovator in alt lending for 20 years now.

CAN has solid technology and has continuously invested in it over the years. Most importantly, it has a solid credit model that got it through the Great Recession back in 2008. The company has a tenured staff and a large customer base that the company has lent $7 billion to since its inception. This foundation is extremely strong and is where we start to build the new strategy from going forward. But we are entering into a new chapter of growth. I think the biggest change is we want to move away from a single-product focus, which today is predominately providing working capital loans. Merchant Cash Advance has also been a traditional product at CAN, but that comprises only about 5 percent of new originations.

We are moving from a single product to servicing a market — and that market is small business customers in the United States. There are 25 million to 30 million of them and they are still greatly underserved by banks in this country.

Equipment Finance Advisor: What does CAN need to do to service a market versus sell a product?

Siciliano: You have to expand and offer different products. It’s very powerful to be able to do repeat business with an existing customer set. It’s powerful in any business, but particularly in the lending business, where you have a credit profile on customers. You really want to bring your best customers back and sell them again and again. You want to have a relationship that lasts not just a year but a decade. And, you want to be able to look and say I really helped this small business grow and succeed.

In time, we will look to add additional products so we can cross-sell to these small businesses and retain them as customers. That means maybe giving them a line of credit, perhaps an equipment lease—whatever their needs are in the financial realm.

Equipment Finance Advisor: That sounds like a significant change for CAN – is it?

Siciliano: It is a pretty big change. To offer different products, we must leverage some of the things we already have in place. We have good credit models, but they won’t fit exactly for equipment leases. The same with technology. For us to onboard a new customer with a lease, for example, requires a technology spend; or an adaptation at a minimum. It’s is different type of billing and collection process. Plus, you have assets at the end. You have to make investments to effectively do that type of business, but it is highly leverageable to keep that customer base and cross-sell them multiple times.

This a lot of what we are going to be focused on for the next quarters and years.

Equipment Finance Advisor: Your background has been the equipment finance sector. Do you see significant opportunities for CAN Capital to expand into this space?

Siciliano: I won’t say definitely because it is my second week on the job. But it fits a lot of the objectives that we have for this business. First, we want to serve large markets. The equipment leasing market is a very large market and has been expanding. Second, it is still underserved by banks, just like working capital loans. The other struggle we have in this industry is customer acquisition costs. Those are very high. We need to get the acquisition costs down. The beauty of the leasing business is it provides the ability to work with vendors, equipment manufacturers and equipment resellers. They are happy to bring you their customers, provided you give them great service and experience, because their objective is to move a piece of equipment and equipment financing facilitates this objective. You also get the ability to resell to those customers over the years. For those reasons, leasing makes a lot of sense to me. It is something we are going to look at closely.

We have partners today as well. So beyond going direct to our customers, we are working with brokers and they are valued partners, so we will be expanding this model. But it is costly, and we want to diversify with other sources as we get bigger. Today we are working with brokers that are providing working capital, equipment finance and MCA financing. They are implementing what I’m describing. When they are on the phone with a small business customer, they are feeling out their needs in all of those areas. And, if they accept a financial product offering, they place it through a syndicate of partners, including CAN Capital if it is for working capital.

Equipment Finance Advisor: You have an enormous customer base. How will this help CAN Capital as it enters new markets?

Siciliano: We have a very large customer base to work from and we have a tremendous amount of credit data on them. Analytics and modeling have become really prevalent. That is something we do use here at CAN and we’re going to expand. Our credit models and our propensity models, which show the propensity to use our product, will direct us on where we should put our efforts.

Equipment Finance Advisor: Do you believe equipment finance companies that are not focused on conducting business faster via the use of technology are they going to be left behind?

Siciliano: 100 percent! I think the equipment leasing industry can learn some things from fintechs about the tech side of things—modeling, autoscoring, autodecisioning, rapid processing, quick response time to customers, etc. Customers are demanding that now. And that means the time to deliver a decision back on a transaction is getting shorter. On the flip side, the fintechs can learn something about the credit side of the equation. Most equipment leasing platforms have very refined credit models. You’ve got to get the credit side right too. That’s the Achilles heel of the business we are in today.

These two industries can come together and can learn from each other. If you can apply advanced technologies to these great credit models and start serving a broader base of customers in a timely and convenient fashion, you have really got a unique product offering. That in essence is on my mind for CAN.

Equipment Finance Advisor: CAN is one of the oldest fintechs. What has distinguished CAN from its competitors?

Siciliano: Let me start with its people and employees. There are caring folks here who genuinely want to support and build relationships with their customers – that’s impressive. And there is a lot of tenure here because the company has been around for 20 years and was a pioneer in the industry.

Additionally, CAN is one of the very few fintechs that has gone through and survived major credit cycles and economic downturns. When you can do that, and your credit models hold up, you learn a lot which makes you very smart in terms of making required modifications and tweaks to your model.

Next, I would say is speed. We’ll continue to invest in technology, which is one of the reasons we have been a true innovator in the space for many years.

Equipment Finance Advisor: What made this CEO position so appealing personally for you?

Siciliano: Beyond what I’ve already mentioned, I really did feel this was a hand-in-glove fit for me. One of the things I’m most proud of is being involved in rebuilding my previous company, Marlin, post-crisis. I’ve always been tasked with the growth; building teams and taking businesses to the next level. I really enjoy that challenge. That is exactly the phase that CAN is in right now. I feel lucky to be here, to be doing what I love, which is coming in each day creating new strategies with the team on how we are going to build this business. It’s very rewarding.