Helping Business Owners Find Loans: The Startup Story Of Lendio

Brock Blake stumbled into the world of entrepreneurship when he was still attending college at BYU. He was studying finance and won an entrepreneurship competition that awarded him $50,000 to start a business. The only problem was that he didn’t exactly know what he wanted to do, much less how to go about launching into the business world. 

Instead of diving in headfirst into the first idea or opportunity that presented itself, Brock decided to learn about the business of going into business. If he was going to be successful, he knew he needed to know how to be an entrepreneur. So he did his own market research and spoke to business owners in different areas of the market to know what it was like. In doing that research, he recognized a common thread between all the businesses: they needed capital. “I realized…that this was a big market, a big opportunity and a big pain that I thought we could solve.”

Empowered with the idea of helping businesses get on their feet, Brock launched his first business, Funding Utah (which would evolve to be Funding Universe) — which helped connect entrepreneurs to venture capitalists and angel investors. But the reality is that only one or two percent of entrepreneurs have the type of company that can or will raise money through investors. Most businesses are main street businesses, like restaurants, retail shops, landscapers or construction companies that need small business loans. “It’s not great to have a business where [you’re turning away] 98% of your customers because they’re not going to raise money,” Brock says. 

So instead of staying focused on a small equity-seeking segment of the market, they decided to pivot and focus on the larger, loan-seeking 98%. And thus, Lendio — a company focused on helping small business owners get access to capital — was born.

“I realized that this was a big market, a big opportunity and a big pain that I thought we could solve.” - @BrockBlake Click To Tweet 

The Importance of Adding Value, Not Just Money

Even though launching Lendio was a pivot that made sense, the transition had its share of struggles. Initially, the switch was incredibly difficult for Brock. They went from being a successful business (Funding Universe) that generated nearly a million dollars in revenue a month to zero dollars a month practically overnight. “You try to plan for […] all these things and make sure everything works out,” Brock says, “but it was even more painful than you can imagine.” Still, they had conviction that Lendio had a much greater upside, so they moved forward, tackling each challenge head-on. 

Fundraising, in particular, has been “an experience.” 

“There’s so much I could talk about [the] fundraising process in general,” Brock says, noting that you first have to be able to prove that your customers love your product, and then be able to show that your business can scale. It’s a real process that Brock likens to sales. You have to pitch to a lot of investors and do a lot of work to find the one or two people who will ultimately do business with you. 

It’s important, Brock stresses, to go into the process with eyes wide open, because your investors are ultimately going to be your new partner. He thinks Lendio has been fortunate to find some great investors who have added tremendous value to the company. “They’re not just money, they’re adding a lot of value,” he says. 

In fact, they’re often the first people he goes to if there’s a problem. Not only is he holding himself accountable to his investors, but they then become involved in solving the problem. And more often than not, they may have experienced something similar before and be paramount in providing advice or finding a solution.

You’re the CEO

That mentality of open accountability is something that is expected out of Lendio’s employees as well. “We have this mentality here that you’re the CEO of your job,” Brock says. They don’t want to micromanage their employees. Instead, they seek to hire people with the right passion and purpose for the job, provide them with the resources they need to do it, and get out of the way. 

Each employee has what Brock refers to as “a scorecard” so they know exactly what they’re trying to accomplish each month. And then they have “regularly scheduled moments of accountability” where employees can go over all of their successes and talk about the goals they didn’t necessarily hit. If it’s the latter, these sessions become a helpful way to assess where things may have gone wrong. It’s a way to fail fast in order to not make that mistake again. 

Brock believes this autonomy gives employees the ability to question the status quo, make mistakes and push limits. It not only helps employees stay engaged and energized in their jobs but also keeps the company from becoming complacent or stagnant in the way that they do things. 

New Products and the Pursuit of Fueling the American Dream

But right now, Lendio is far from complacent. The business has raised just under $50 million in equity capital and seen nearly a one hundred percent growth year over year. And they don’t show signs of slowing down. In fact, they’re about to further expand their business with a new product.

During the webcast, Brock revealed that they recently acquired technology to directly help their customers. It’s a software tool called “Sunrise” that’s designed to easily help businesses manage their cash, forecast, send out invoices and collect money. Lendio is giving it away for free to every business owner who signs up with them. If businesses need further bookkeeping and financial help, they can upgrade for a small monthly fee. 

According to Brock, early customer feedback has been phenomenal. He’s excited about the future of Lendio and what Sunrise can do for their customers. “We call [what we do] fueling the American Dream,” Brock says, “because at the end of the day, [all we’re doing] is helping the business owner.”

Did you enjoy this companion blog? Catch the full webcast below!

If you’d like to read the full transcript of Marilyn Gorman’s conversation with Brock Blake, you may download it.

Thanks to Shannon Lorenzen for contributing this piece. If you seek to bring the entrepreneurial spirit to your organization, Lean Startup Co. can help.