Lending Loop is Canada’s first and only regulated peer-to-peer lending marketplace focused on small business. Our core focus is providing businesses with accessible capital at fair interest rates through a simple online process. We do this by cutting out the costly intermediaries, such as banks, making affordable financing accessible to small businesses. Lending Loop gives all Canadians access to simple and attractive returns by supporting the growth of local Canadian businesses.
Lending Loop is a lending platform focused on small businesses. Can you talk about how they are helping Canadian SMEs grow their businesses?
There are a few core things that we do:
The primary thing is providing financing to SMEs. When SMEs are looking to grow, renovate, gather inventory before the holiday season – we’re there for them and we’re the fastest and lowest cost option. We support businesses with more than just capital. We’re really focused on working with them to provide tools like free credit checks, and other opportunities to help them secure the capital they are looking for.
How is Lending Loop different from the traditional financial institutions who offer to finance to small and medium-sized businesses in Canada? What makes you different?
There are two key differences:
1) The speed, convenience, and accessibility of our offering. We’re significantly faster than other options (1-2 days). You can do it all online. And we remove a lot of the bias from the decision making and simply use data points to predict business risk. We tend to be more flexible and look at businesses through a different lens compared to traditional financial institutions.
2) The capital that we provide comes from Canadians who want to put our money into SMEs and into the economy. Lending Loop is in the business of making sure that both sides have a good experience. We’re incentivized to get them the right rate for that business.
Lending Loop connects small businesses with investors to help them grow their business. How do you go about linking investors with small business owners?
We have an online platform where any Canadians can sign up and they can quickly create an online profile to connect them with SMEs.
What do you believe are the benefits for investors to invest in small businesses?
1) It’s a very unique and attractive asset class. It’s not tied to market fluctuations, the real estate industry or other typical indicators.
2) It’s a loan product and you’re getting a fixed rate of return so investors value the stability.
3) For many of our investors, it’s a way to give back and support businesses in their local communities, and the Canadian economy at large.
What was the inspiration behind Lending Loop? What brought up the idea to connect investors with small business owners?
My parents were both Small business owners and I worked with them on weeknights and weekends. I noticed the challenges that SMEs have to get capital. People often rely on family and friends and if you don’t have such resources, it often can become quite difficult. I personally really wanted to find a better way than invest my money in something other than the stock market. And helping small business owners find access to capital was a great opportunity.
As co-founder and CEO of Lending Loop, what are some of the accomplishments that the company has had with Canadian SMEs?
We have helped over 500 Canadian businesses gain access to 35 million dollars of capital. We have helped companies hire new employees, expand by opening new offices, and helped them get out of tougher financial situations. There have been countless success stories with businesses that we’ve helped. Some are businesses that you may run into every day on the street, and some are much less visible manufacturing companies for example that we have helped.
Can you talk about some of the challenges that you face on a daily basis and how you overcome them?
We look at ourselves as a small business. So we have many of the challenges that other SMEs have. We want to make sure we’re doing a good job in protecting both sides of our platform and make the market more aware of Lending Loop, and that there are other options out there other than traditional financial institutions.
What advice can you give to small and medium-sized business owners who are looking for investment opportunities?
The most important thing is to educate you and constantly be doing research. Speaking to the right people and getting the right advice from friends and family, accountants and bookkeepers or other mentors you may have. It’s essential to understand the market and what the different options are. There are plenty of options for SMEs to help them get access to financing. It’s about doing the research to find the best fit.
On a more personal note, can you tell us what you enjoy doing in your free time?
I love technology and building little things in my off time on weeknights and weekends. I’m a huge Raptors fan, soccer fan, and I really enjoy following politics.