A couple of weeks ago, we received an application from a building materials distributor from Eastern Europe. At first glance, everything looked just fine: six years in business, stable revenue, and agreements with major contractors. They needed €400,000 for warehouse expansion.
As always, we started due diligence, and that became the turning point for both us and them...
Here's what we found out 🤩
🔘 The revenue was real, but 70% of it came from a single client. If that client left, the business would instantly lose most of its cash flow.
🔘 Contracts existed, but there were no termination penalties. Legally, the client could walk away at any moment without consequences.
🔘 Warehouse equipment was offered as collateral. We checked the liquidity: the equipment was highly specialized and difficult to resell. In case of default, liquidation could take 12–18 months with a 40–50% discount.
🔘 Financial statements showed revenue growth, but margins had been shrinking for three consecutive years. In reality, the company was growing through dumping.
🤩 Solution: Rejection.
You'll never see such deals on our platform. Behind every business listed on our platform is a stack of rejected applications you never see.
❗️ And keep this in mind: More than 90% of businesses never even reach the audit stage. Before entering the review process, a company must pay for an audit itself, proving both serious intentions and confidence in its own transparency.
We reject more businesses than we approve. That’s one of the reasons 8lends has had no defaults and investors continue receiving stable monthly returns.
Pool quality isn't a coincidence. It's the work you don't see, but on which your earnings depend.