Wharton FinTech
Published in

Wharton FinTech

Revolutionizing Working Capital Financing — Sandy Kemper, Founder & CEO of C2FO

In this Wharton Fintech episode, Miguel Armaza interviews Sandy Kemper, Founder & CEO of C2FO, the world’s largest platform for working capital financing. C2FO serves over a million businesses representing more than $10 trillion in annual sales across 167 countries and their platform connects over $100 billion of daily volume. Truly a global financial powerhouse!

C2FO is a Series G company and has raised hundreds of millions of dollars from elite investors like Temasek, Union Square Ventures, Softbank, Allianz, Citi Ventures, Tiger Global, and many more.

Sandy has had a long and successful career in banking, technology, fintech, and asset management and he even told us how he turned his art collecting passion into a profitable business.

To understand the story of C2FO, you have to understand some of the challenges Sandy encountered early in his career. As a young corporate banker at UMB Bank, he remembers getting turned down by the bank’s credit committee for loans that, in his mind, should have been made. He eventually understood some of the deleterious effects of risk-based underwriting and realized there was a better opportunity to structure loans using the client’s Accounts Receivable (AR) or Accounts Payable (AP) to reduce the risk profile of the transaction. Sandy eventually became Chairman and CEO of UMB Bank, but left the company in 2000 to found Perfect Commerce, an eCommerce business that later went public. In the early startup days of the company, Mr. Kemper remembers struggling to make payroll and calling some of the clients that owned them Accounts Receivable with the hopes of settling these payments ahead of time. Not only was this a risky strategy that put the company’s reputation on the line, but it was also inefficient. The incident helped Sandy realize there should be a marketplace to buy and sell ARs and APs to somebody interested in paying early for a fee. So he eventually created this marketplace and launched C2FO.

Cutting the Middle Man and Helping Minority-Owned Businesses

C2FO was launched in 2008, with the goal of creating an exchange to match buyers and sellers of working capital paper. Over the last 12 years, the company has stayed true to its original mission and has become the undisputed leader in the space. C2FO’s astonishing growth has led them to serve over a million businesses a year and their platform connects more than $100 billion of daily accounts payable and accounts receivable around the world. Securing large customers with global supply chains like Costco has also meant they have been a global company from almost day one and C2FO now serves firms in over 167 countries, operating in 70+ currencies.

One interesting and unexpected consequence of C2FO’s model has been the disproportionately high participation of minority-owned businesses. Looking at the normalized data, the participation and the registration rate from customers running small, minority-owned businesses is 1.5x — 1.6x higher than their non-minority cohort peers. Sandy believes this is proof minority-owned businesses are being underserved by the existing financial system, but is happy C2FO can do its part to improve the problem.

Proposal For a Federal Supplier Payment Program

In light of the COVID crisis, Sandy also told us about C2FO’s open letter to the Federal Reserve Bank and the US government. Mr. Kemper and team argued for the creation of a relief program for SMBs that would help Fortune 1000 firms with low-cost financing to accelerate the payment of their suppliers. These small firms usually have no more than a few weeks of cash reserves while also carrying meaningful Accounts Receivable pending, often for sales executed over the last 60 to 90 days. C2FO’s proposal would aim to provide low-cost funds to large businesses with the purpose of paying their supplier’s invoices ahead of time.

For context, the average Fortune 1000 company in the US has around 1300 unique small businesses in their supply chain and owes somewhere between $70–120 million in receivables to their suppliers on any given day. This proposal would allow large companies to take care of themselves while strengthening their supply chain. It would also eliminate the need for 1300 small businesses to go to their bank and tap their lines of credit.

Entrepreneurial Advice

When it comes to venture-backed businesses, Sandy advocates taking the lowest valuation you can stomach, from the best VC investor you can find. He says C2FO was lucky to bring Union Square Ventures as a Series B investor and argues once you get quality investors, as long as you don’t screw up and the business keeps growing, the next two rounds are basically assured.

Sandy Kemper has built a great company and he knows it. In his own words, “When the book is good, it starts to write itself (…) and we’ve got extraordinary people inside this model, taking care of extraordinary customers.” The company has reached such scale, that he is not even sure he is leading the business anymore. As a CEO, he thinks it is important to understand the difference between guardrails and speed bumps and his job is to eliminate speed bumps while ensuring there are guardrails for people to go faster.

Alexander (Sandy) C. Kemper

Sandy is the founder of C2FO and serves as Chairman of the Board and CEO. In addition, he is Chairman of the Board of The Collectors Fund, a private equity fund focused on alternative asset classes. Prior to founding The Collectors Fund and C2FO, Sandy founded Perfect Commerce (fka eScout) and served as the company’s Chairman and Chief Executive Officer from 2000–06. Prior to founding Perfect Commerce, he served as Chairman of the Board and CEO of UMB Bank and CEO of UMB Financial, a NASDAQ traded financial services company more than $20 billion in assets. Sandy began his career with UMB after graduating from Northwestern University in 1987. He majored in American History. Sandy is an active angel and venture investor and serves on the corporate boards of UMB Financial (NASDAQ: UMBF), UMB Bank, NIC (NASDAQ: EGOV), and AXA Art USA (NYSE: AXA). He previously served on the board of Cboe Global Markets, Inc. (Cboe) and BATS Exchange, two of the largest stock exchanges in the world. Sandy and his family are active in academic, civic and philanthropic endeavors. He serves on the board of the Agriculture Future of America (AFA), a non-profit scholarship and leadership development organization that he co-founded. Sandy and his family live on a farm in Kansas City, Mo., where they raise and care for their horses, sheep and any and all wild animals (not including their four children).

About C2FO

C2FO is the world’s largest platform for working capital. We serve over one million businesses representing $10.5 trillion in annual sales across more than 180 countries. Our online platform connects more than $100 billion of daily accounts payable and accounts receivable. Whether you need working capital or have excess working capital, Name Your Rate™, and the C2FO platform will match your request in seconds. You can accelerate or extend AP or AR on demand, providing you, your customers and your suppliers greater control over cash flow. You can also utilize AR financing and other data-driven funding options.

C2FO is working capital, working for everyone. Our mission is to deliver a future where every company in the world has the capital needed to grow. To learn more, visit C2FO.com.



We are FinTech thought leaders connecting innovators, academics, and investors with the ideas and products that are reinventing global financial services.

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Miguel Armaza

🎙Co-President/Podcast Host @WhartonFintech. Fintech investor @ Gilgamesh. 📚MBA/MA Candidate @Wharton/@LauderInstitute. Author of Fintech Leaders Newsletter✍️