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Presentation: Embracing technology to create trust among small businesses Presented by: Noah Breslow, Chief Executive Officer, OnDeck While the alternative lending industry for small businesses is burgeoning, creating trust for a customer base with heightened sensitivities is no easy feat. OnDeck CEO Noah Breslow explores how his 7-year old company used cutting edge technology and a passion for Main Street to change the relationship small businesses have with their lenders. www.bdionline.com
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© Copyright 2013 On Deck. All rights reserved.
OnDeck powers the growth of small businesses
through lending and technology innovation
Key Metrics
Delivered over $750M to small
businesses nationwide since
2007
$50M in monthly loan
originations (Nov. 2013)
100%+ year-over-year revenue
growth
Over 700 different industries
served
$100M of equity capital raised
225 employees
Headquartered in NYC, with
regional offices in Arlington, VA
and Denver, CO
Accolades include:
2-Time Inc. 500|5000 Fastest
Growing Companies
Forbes 100 Most Promising
Companies
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© Copyright 2013 On Deck. All rights reserved.
How is the financial services
industry being disrupted by new
entrants?
How do new financial services
entrants build trust with their
customers?
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© Copyright 2013 On Deck. All rights reserved.
Types of Disruption
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© Copyright 2013 On Deck. All rights reserved.
Three Financial Services Markets Being Disrupted
PAYMENTS LENDING BANKING
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© Copyright 2013 On Deck. All rights reserved.
1. SBA 2012 Small Business Lending Study - # of Loans Originated by CRA Reporting Institutions
2. Federal Reserve Bank of New York Small Business Borrowers Poll Report, May 2012
Low success rate of SMBs
securing capital2Number of sub-$100k
commercial loans is declining
(millions)1
13.0
10.2
5.8
3.93.3
2007 2008 2009 2010 2011
Partial amount approved
36%
Full amount approved
13%
Amountundetermined
14%
Denied37%
Small Business Lending: Ripe for Disruption
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© Copyright 2013 On Deck. All rights reserved.
Small Business Owners Value Access, Convenience, Speed, and Service
1. Bancography Study: The State of Branches In the Age of Automated Banking
2. Wells Fargo Website
Branch Closures Signal Online Trend1 But, Bank Websites Still
Request In-Person Applications2
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© Copyright 2013 On Deck. All rights reserved.
OnDeck uses technology to open up the market for small business loans
OnDeck Term Loans
Amounts: $5-$250k
Term: 3 - 18 months
Used for inventory, working
capital, equipment, marketing
Typical Borrower Profile
Time in Business: 9.8 years
Annual Revenues: $964,000
Over 700 Different Industries
Access Speed Customer Service
Untapped SMB market
Performance-based capital
using proprietary data and
credit models
10-minute application
Funding as fast as 24 hours
A+ BBB rating
Best in Class NPS of 67
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© Copyright 2013 On Deck. All rights reserved.
And, to solve small business’ pain points
Small businesses should spend time running their business – not
dealing with financing
Small Business Problem OnDeck’s Technology Solution
No time to search for capitalAdvanced algorithms deliver decisions in
minutes
No time to assemble paperworkSimple and paperless online application – takes
10 minutes to complete
Large monthly payments impact on
cash flowSmaller, automated daily debit payments
Ongoing financing needsEasy loan renewal process for existing
customers
Little / no business creditRepayment reported back to the credit
agencies
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© Copyright 2013 On Deck. All rights reserved.
It is more difficult to be a new entrant in financial services than in other industries
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© Copyright 2013 On Deck. All rights reserved.
How can we create trust among a
customer base that has good
reason to be distrustful?
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© Copyright 2013 On Deck. All rights reserved.
Building trust as a new entrant in financial services
Set the contrast
Simplify the message
Manage expectations accurately
Bring a human touch to online experiences
Engage your promoters
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© Copyright 2013 On Deck. All rights reserved.
Set the Contrast
Tell your customers that you’re better than the established provider
Established Provider Who is disrupting them?
Payment Processors
Traditional Banks
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© Copyright 2013 On Deck. All rights reserved.
Simplify Your Message
Financial services is outside of small business’ day-to-day expertise –
make it easy to understand what you provide
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© Copyright 2013 On Deck. All rights reserved.
Manage Expectations Closely
How do I become a customer?
Business owners are strapped for time – don’t make them search to find
processes and procedures
How much does it cost? How long will this take?
A fast and easy application process –
takes only minutes to complete.
Or, you can call 888-269-4246 if you
have questions
We have Loan Specialists available 6-
days a week
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© Copyright 2013 On Deck. All rights reserved.
Bring the Human Touch to the Online Channel
Have real people available
– OnDeck is open 6 days a week with extended hours
Have multiple channels available
– Phone
– Click to chat
– Fax**
Bridge online and offline transactions through explicit connection
points
Small business owners closely associate their business with their
identity – servicing both the business and the person is crucial
**Yes, small business owners still use fax machines
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© Copyright 2013 On Deck. All rights reserved.
Engage Your Promoters
Small business owners trust other small business owners more
than they trust you
Build ratings and profiles in places your audience visits
