Corporate Financial Health Ratings

We found an interesting fintech today which rates the financial health of both public and priate companies – Rapid Ratings – and they must be doing something right because they’ve recently added four new senior management roles to keep pace with their rapid rate of growth.  According to their CEO James Gellert, ““We’ve had very impressive growth over the past several years, and while we’ve hired to keep pace, we needed to grow our top ranks to leverage the wisdom that comes with experience.”

Their value proposition is described as follows:  “Rapid Ratings is the creator of the proprietary FHR® (Financial Health Rating), the industry’s leading assessment of public and private company financial health. The company’s disruptive methodology, scalable solutions, and unparalleled support enables businesses to effectively manage and price risks associated with the financial health of third-parties including customers, trading counterparties, suppliers, vendors, and investments. Rapid Ratings is the only company to rate public and private companies, globally and with the same depth of analysis.”

Their website states that they offer solutions for:

  • Supplier Risk Management
  • Third-party Risk Management
  • Credit Risk Management
  • Capital Markets Trading
  • Commercial Insurance Underwriting &
  • Investment & Risk Management

While the blog on their website has posts related to each of the above categories, they had a rather interesting blogpost about the recent Hanjin Shipping default, and stated they had tracked the firm since 2010, when it had a FHR (Financial Health Risk) of 61 (Low Risk).  By 2015, their FHR had fallen to 30 (High Risk) and by 2016 it fell even further to an FHR of 18 (Very High Risk).  Clients who worked with them were then able to shift contracts away from the shipper and were in stronger positions to take deliverables for 2016 inbound holiday inventory then others.

The same info is also used by investment firms to track the solvency of companies they are vested in.  All in all, a really interesting risk management platform with a multitude of fintech applications. 

Read Full Press Release at BusinessWire