Thought Leaders in Financial Technology: Brock Blake, CEO of Lendio (Part 5)

Brock Blake: We have a partnership with Comcast. In Comcast, we have access to proprietary data around how long have they been a customer, how many employees do they have, what’s their track record of payment, etc. Everyone is looking for a unique source of data that they can access to that others can’t. It’s in high demand.

I think a year ago or 18 months ago, lenders were talking about how they were leveraging online data like Yelp and other social profile data points as part of their underwriting. I think that was a hyperbole – a little bit of trying to make it sound sexier than it was. I think that lenders can use social profile data like Yelp to understand.

If I’m in doubt whether this business is a real business, I could maybe go look on Yelp and see if they have a profile. I could maybe see if it’s a business that has a thousand reviews and they’re all one star and that might say something. But most of these lenders are not going out and trying to look on Facebook and see how many friends they have and Yelp to see how many reviews they have. I don’t think it’s a real indicator of whether the business will be able to repay the loan. Everyone wants access to their own proprietary data source.

Sramana Mitra: Proprietary versus open. What is the philosophy? I looked quite closely at Intuit as I mentioned earlier. Intuit is doing QuickBooks financing. They’re using their own data – QuickBooks online data. QuickBooks online is a very big platform in the small business arena. It’s a very valuable and very large data source. Are they integrating with other lenders? Like if a bank wants to integrate with QuickBooks online, is that something that is happening right now?

Brock Blake: QuickBooks has a marketplace. I can’t remember. I think it’s QuickBooks Marketplace or something like that where you can go on and you can be a provider for a QuickBooks customer. When you’re using QuickBooks, you could say you need a loan and it’ll pull up the various providers.

That business owner then has to choose you and then give you permission to access the data as part of your application process, which is very different than a customer comes to a lender on their own.

Sramana Mitra: But it’s not necessary. If I’m a bank and I get a loan application from a small business. Part of the application, do you allow the bank to look at your QuickBooks sheet data and if there’s an integration. The small business just goes ahead and provides that approval then it’s still the same purpose isn’t it?

Brock Blake: Yes, they have the ability to do that. I’m not sure how much I want to say this because I don’t want to come across negatively. But the unspoken hurdle with that is that business owners are running their businesses. They’re not experts at their financials and accounting. They may or may not have a bookkeeper or an accountant. So, they’re a little bit hesitant to provide the pipe end from QuickBooks to the loan application because the QuickBooks data is only valuable as it is up to date. If the business owner is three months behind, they don’t want to share that data.

This segment is part 5 in the series : Thought Leaders in Financial Technology: Brock Blake, CEO of Lendio
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