Running A Business

Entrepreneur Addiction Podcast #1 — Don’t ‘Pull’ Too Hard

Aug 29, 2011 • 10+ min read
Table of Contents

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      Go here to view and download on iTunes.

      Welcome to our debut podcast, which will be on the blog every Monday morning. Patrick Wiscombe will host the show each week, covering a wide variety of entrepreneur topics that can help small businesses be successful. Patrick has had many years experience in radio and TV, and owns the Patrick Wiscombe Podcast Network.

      This episode covers:

      • The state of small business
      • The state of small business lending
      • Why small Business Lending is the solution to the economic crisis
      • Difference between a hard and soft credit pull
      • Lendio in the Inc. 500
      • Financing options you didn’t know about
      • What the podcast will cover in the future

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      If you can’t listen, here’s the text:

      Cool Voice Guy: Fueling your business success, this is the entrepreneur addiction podcast, breaking the small business loan news you need if you obsess about your company. Heard exclusively at And now here are our your hosts: Brock Blake, Dan Bischoff and Patrick Wiscombe.

      Patrick: It’s the debut edition of the Entrepreneur Addiction Podcast. coming up on toady’s edition of the podcast, we’re going to be talking about small business loans. Now before you turn off the radio and go, “Oh, come on, really? Small business loans?” No, this is actually really informative, we promise a very entertaining podcast. Now, joining me for the podcast, the CEO of Lendio, who is the main sponsor of this podcast. Brock Blake it’s good have you here and it’s good to meet you, too.

      Brock: Yeah, I’m very excited to be here and we’re very excited about this podcast. I think it’ll be very informative for the listeners and to be able to talk a little about small business loans, and especially in today’s economy, we know what a pain that is, so we’re going to talk a little bit about it and help people through their “entrepreneurial addiction.”

      Patrick: Dan Bischoff, the corporate communications Director of Lendio is also in Studio with us. Good to have you here.

      Dan: Good to be here.

      Patrick: Now guys let’s get right to the heart of the podcast.

      Dan: “First, just to give Brock some props, last Tuesday Lendio was named to the Inc. 500 for the second straight year. So props to Brock. And today, Brock’s going to an awards ceremony with Utah Business Magazine to celebrate being mentioned in the Fast 50.”

      Patrick: Congratulations, that’s huge news. The Inc 500 in back to back years.

      Brock: Yeah, when you think of entrepreneurs about starting a business, that’s one of those dreams to be able to be one of the 500 fastest growing companies in the U.S. We’re excited about it, especially because we have such a good team, and we’re really passionate about helping business owners. It’s fun to have some of those things happen as you grow your company.

      Patrick: Tell us what Lendio does. Maybe we should explain what the company does before we pontificate ourselves as experts.

      Brock: That’s a great question. Lendio, our goal is to help a small business owner get access to a small business loan. Let me describe the way the current market works. You take a small business owner, and this small business owner is likely very good at, maybe they own a restaurant, or maybe have a landscaping company, or maybe they own a consulting firm, and they’re really good at what they know best. But when it comes to getting a loan, usually what happens it they know they need a $50,000 loan to grow their business. But how to get that loan, where to go, which banks are lending, which loan products are available, most of those answers are really hard to come by. As a result of that, 9 times out of 10 a business owner applies at a local bank or credit union, they get declined for a loan. Our focus is to say, alright business owner, we’re going to work with all the lenders across the United States, we are going to identify their loan preferences, the loan products they focus on, and we’re going to gather that information and we’re going to come to the business owner and we’re going to say, ‘OK business owner, let us gather some information about you.

      Patrick: Now is this on the website or are you generally speaking?

      Brock: Yeah, this is all our web technology. If a business owner comes to our website, they sign up and we gather some information about them, and we do a soft pull on their credit. We’ve partnered with Equifax. And we want to be able to look at the business owners’ profile. But a soft pull is important because when we pull the credit we don’t have a hard inquire that damages a person’s credit. So we are able to preserve a strong credit score.

      Patrick: We’ll see a lot of people don’t know that it even damages the score. Why do they look at as damaging? Would it be damaging because any time you pull credit it’s considered “Oh, man this Person’s looking for credit.”

      Brock: Right Right

      Dan: a hard pull, though.

      Brock: There’s a hard inquiry and a soft inquiry. We have the ability to do a soft inquiry so it doesn’t damage your credit. We can look at your data without it damaging your credit.

      Patrick: Oh, okay. So it’s good.

      Brock: So then we use all that information to do three things: First thing is to guide the business owner on the type of loan product. When it comes to business loans there are perhaps twenty different loan products: SBA loans, equipment loans, working capital loans, export loans, and so on…

      Patrick: Construction?

      Brock: So we tell the business owner “based on your data, here are the three best types of loans that you could qualify for. Then step number two is to be able to then say, “within each of those loan categories, here are the lenders that you are pre-approved for.” Then we’ll give them a list, and then right through our platform they can apply to that lender. They can click the button, and all of their information will get sent to the lender. The lender will get a notification. And you don’t have to fill out a bunch of long form applications. You don’t have to get your credit pulled, and in a few short minutes you can get pre-approved to all the lenders that are actually lending in today’s environment.

      Patrick: I’m no expert, but to me that sounds a little, not even evolutionary, this is revolutionary. In terms of business loans, I’ve never heard of this.

      Brock: Yeah, for us we’re really, really excited about the product. It just makes the business owner life so much easier. And there really isn’t anything else out there like that that will walk you through that process and make it so efficient for you.

      Patrick: That’s pretty cool.

      Dan: Anybody’s that bored about business loans, they probably shouldn’t be. They think of Angel Investors or Venture Capital as being the sexy thing. That’s what sounds cool. That’s what Brock was doing before at Funding Universe. But what he found out is that most of these businesses don’t’ have the kind of business model that fits an investor. And so he was turning away 90 percent of his customers because venture capital wasn’t the right fit.

      Patrick: So was this your brainchild to come up with a hybrid model to submit you information once and let the institutions, what, ‘fight’ so they can get the loan.

      Brock: Well, they don’t necessarily fight over it. But it brings to the business owner all of their options in one place, and then gives them multiple option that you might not have had before.

      Patrick: Or even places that they hadn’t even thought of.

      Brock: Yeah. There’s 8000 financial institutions across the United States. And the days where you would just go to the bank on the street corner and apply for a loan and get approved, I mean those days are long gone. Every bank or credit union has a different loan product that they focus on, a different underwriting criteria, a different geographic footprint, and to have a business owner be expected to know what all of that is and keep track of it to improve their chances of getting a loan is just impossible. So we do all of that and kind of take the guess work out of it for the business owner. Then we say, “Here’s a lender that may not be in your state, may not be in your region, you may not have even heard of it, but it’s your best chance of getting a loan based on your profile.

      Patrick: This sounds a lot better. I already smell an extension of this business. If you’re going business loans, I can smell consumer loans. Have you thought about that?

      Brock: We do a little bit with consumer loans. But we are so passionate about small business owners and entrepreneurs, and the market is so large, that we are really going to take our crack at small business loans and try to make that market efficient. But as you said, I think there’s a natural extension to move into personal loans or consumer loans or those sorts of things.

      Patrick: Why haven’t people heard of this before? I never have. I always think of, “well, just go to Wells Fargo or Bank of America.” It has always sound like a hassle and has taken a year to get approved, and even at that it’s always on some pretty short leash.

      Brock: Yeah, you know, the perception on the market is probably an accurate one. I mean, the reason why is because, the statistics are that nine times out of ten I’m going to do that and I’m going to get declined. And so people understand that it’s difficult and a little bit of a negative perception. We’re trying to change that to be able to say, “Hey, you know what, there are lender that are looking to loan money, and we can make that process easier for you.”

      Dan: With this economy too, I’d say, the perception is that banks aren’t loaning money.

      Patrick: I would agree.

      Dan: With this bad economy they’ve tightened their credit, or their terms and things. But Brock’s been to some banking conferences, and that’s not the issue. Banks want to lend to businesses right now.

      Brock: Yeah, it’s interesting. The market timing right now is phenomenal because, we’ve gone through this recession, (I’m not saying we’re out of the recession), but in the last two and half, three years, back to 2008, banks and credit unions really pulled back. They were kind of forced to. What that means is that they have all these deposits in their bank, and banks don’t make money by holding deposits. (laughter) They make money by lending. And so they pulled way back and now they got all this money in their coffer saying, “Man, I’ve got to lend that.”

      Patrick: But it was a real pull back?

      Brock: It was a real pull back. Now they’re saying, “Okay, we’ve got all these deposits, now we’ve need lend.” And now they’re being very aggressive in their approach to growing small business loans. I wouldn’t say aggressive as in the reducing of their qualifications so much. I mean, in some case they are. But for those that are qualified they want to lend as much as possible.

      Dan: There’s a federal study that just came out, I think, a week ago. But they do one every quarter where they survey different banks. And in July they did this survey, and in the first time in four years they found out that banks are starting to loosen those terms. And a lot of the reasons they said, one of the reasons is because of alternative lenders that are creating a lot of competition.

      Patrick: All the corner ‘check for cash like’ that?

      Dan: Not just that. There’s also places like Prosper and Lender Club, which offer peer to peer loan and some social lending that’s going on. But these things are creating some competition for the burrowers, and the banks are wanting to get back into that is what it looks like.

      Brock: Yeah, there’s a lot of lenders that have taken advantage of that pull back that the banks went through. And so what they’re saying is that there’s other types of loans that someone can make that aren’t your traditional bank loans. There’s peer to peer lending, there’s merchant cash advance, there’s…

      Patrick: By the way, is a merchant cash advance, we’re talking about somebody who has a credit card account and they basically take a loan against their account, for a lack of a better phrase?

      Brock: Yeah, and that’s why I’m really excited about this pod cast. I think that we ought to, over the course of the next few weeks and months, we can really dive into each type of loan product. But just the general overview of the merchant cash advance: If I’m a business owner, and let’s say I’m a restaurant and most of my revenue is coming in through credit card, my customers are paying via credit cards, which means lets say I’ve got over two hundred thousand dollars of revenue every month via credit card revenue, well, that’s an asset that people lend against. So they’ll say, “Your credit card receivables are the same month to month, so it’s very predictable. I’ll use that as an asset in order to lend you money.” So they’ll advance you, so it’s merchant cash, so they’ll advance you cash because they know your credit card payments is going to get so much revenue month over month.

      Patrick: Because they look at the historical intake?

      Brock: Right.

      Patrick: Okay, now in terms of merchant accounts, and I don’t want to go there because I don’t want to derail the podcast on the first go around. But man, I wish I was visa. Holy cow! To think that depending on who the merchant is, that they get realistically, depending on the transaction, either a debit card where the discount is much smaller, vs a credit card that can go as high as four or four and half percent per transaction. Man I would love to insert myself into that stream and let everyone else make money for me.

      Brock: Yea, I mean, everyone has to except credit cards, right?

      Patrick: They have to.

      Brock: So you if can get a piece of that, there’s some of those merchant account companies or providers that are making money hand-over-fist.

      Dan: You know all these other options are a big thing for the economy as well. The M&T bank chairman, what’s his name?

      Patrick: I’ve got it right here. It’s Robert Wilmers

      Dan: Yeah, he spoke in Buffalo, where they’re located, and he basically linked small business loans to job creation. And he was talking about the economy, that the basic problem of the economy is that there’s not enough jobs created, and the reason is that there’s not business loans. There’s not enough of that life blood of capital to grow a business and create more jobs. And so with these business loans there’s a lot of options that these businesses owners aren’t aware of, that they don’t even know that they exist. They just think its, like we said before, the bank down the street. They don’t know what there are a thousand other options out here. They don’t even know what they qualify for.

      Patrick: would you say that online matching like Lendio, I wouldn’t say a niche market, but this seems like I said kind of a revolutionary idea, in that people don’t think about “Hey, maybe I should do a Google search for small business loans.” I guess there could be a perception out there that you have to get your message out. How do you fight that current of traditional thinking that “you just have to get your message out.”

      Brock: For sure, it’s about awareness. There’s a couple statistics that I would use to answer that question. So, the first is: We also saw a market research study that came out that said, business owners, if they’re looking for products or service, 83% of the time now they’re going to Google. The first place they’re going to go is, “I’m going to look on Google.” And that’s totally increased over the last few years where business owners were looking to their networks. But I think the trend is that everyone has a mobile phone, you know, people are really starting to use iPads and Tablets. I mean everything is so on your fingertips, so if you can just go on Google and type in “small business loans”, people are doing that.

      Patrick: So you’ve got to get Lendio optimized so that you come up at the top so people find you.

      Brock: Right. And the second thing is that, if you think about small business loans, and I’m going to compare small business loans to other types of loan-verticals. If you look at mortgage loans or auto loans or consumer loans, each of these lending-verticals over the last twenty years have become efficient. I mean, you can go anywhere right now and get a mortgage loan.

      Patrick: Is that market also loosing up so you can get a mortgage now?

      Brock: Yeah, actually it was so efficient that we have too many loans done right? Which kind of got us into this mess.

      Patrick: Yeah, “hey, I make three dollars a month.” “You’re approved!”

      Brock: “You’re approved!” but it’s become so efficient, the same thing happened to auto lending. You can go about anywhere and get an auto loan. Small business lending, the market, is very, very far behind. I’d say twenty years behind that. So our goal is to look at what they did in mortgage, look what they did in auto loans, look what they did in consumer lending, and apply those principle and concepts to small business loans. Because I think if you talk about the economy and jobs, it’s small business loans that really drive this economy. So we’ve got to make it easier for banks to do loans and burrowers to get loans.

      Patrick: You know (clapping) I think you said something in one sentence that everyone is thinking if you’re a small business owner.

      Brock: Well, I think it really is important. You know you can read about it in the Wall Street Journal, in the New York Times, and President Obama speaking about it all the time: We need to help small business owners get financing. And part of that is helping banks or credit unions find those qualified business owners. So we’re trying to do both. It’s a big vision, a big market, but we’re really excited about making a little bit of a difference.

      Dan: You know, one think about this too, from a personal experience, and I didn’t know this problem before I came to Lendio, I wasn’t aware of all the other options out there either, but Brock had us go to a bank by ourselves.

      Patrick: You know, I thought that was interesting.

      Dan: Yeah, and he had everyone in the company do it. And from my experience, you go to the bank, I went to a big one, Chase, and there was nobody there that was the small business expert at the bank.

      Patrick: I hate Chase. I’m sorry, can I say that?

      Brock: You can, but we’re not going to.

      Dan: They had me get on the phone with somebody else and talk about it, and there was no real guidance or options. I left there not really knowing what else to do.

      Patrick: I think that’s cool that you would force all of your employees. Were you an employee?

      Dan: Yeah.

      Patrick: Okay, you forced all your employees to go and try and get a business loan so that they could actually experience the headache. Wait, I won’t even call it a headache. I’ll call it a migraine, a big headache.


      Patrick: Basically Lendio offers multiple lenders to access funding from?

      Brock: Right

      Patrick: You fill out… give you some information, all of that information basically gets picked up by those who are interested in giving a particular business a loan?

      Brock: Right.

      Patrick: The second thing, and the second part of that is you’re helping banks actually find qualified people, so they can make loans to those particular small business customers.

      Brock: Right

      Patrick: Guys a think this is a brilliant idea. I really do. I really hope it takes off. I know this is episode one of this podcast, but in terms of big vision, I get it. If anything I think everyone should listen to a financial podcast, just so they can get smarter about money, because I think a lot of people are stupid about money.

      Dan: Every entrepreneur along the way is going to need capital, probably, anyway. I mean, so we’re going to talk a lot about capital. We’re also going to bring in some experts, some authors, and some different entrepreneur guys that will offer some different advice. But a lot of it’s going to be about the financial thing too, and how to get capital. And maybe how to get some funding by some Angel Investors too, sometimes.

      Brock: As I mentioned before, I think there’s an opportunity to really dive deep to say, “Okay, I’m a business owner. What are the challenges that are affecting me on a day to day basis?” And a lot of times those challenges are surrounded around capital to start or grow a business. So as we dive deep to be able to say, “If you’re in this situation, this is the type of loan product that you should pursue. And by the way, these are the steps that you ought to take, and the ways that you ought to prepare yourself.” So it really becomes a personalized message to become educated on, “Hey, I need money to grow my business, to hire employes, to buy equipment, to expand inventory. This podcast is going to help me learn what I need to know to do that.”

      Patrick: You’ll find the podcast at We’ll also put it on my podcast site: So guys, awesome!

      Brock: Yeah, thanks for having us.

      Patrick: That was a good first addition. So for Dan Bischoff who is direct of communications at it’s always good to see you.

      Dan: you, too.

      Patrick: Brock Blake CEO of, be sure to check out his company at And if you are a small business person who is looking for capital, and if you know anybody. You may have a neighbor who you’re fascinated with because he gets to go work for himself every single day. (Laughter) Tell them about So for Dan Bischoff and Brock Blake, my name is Patrick Wiscombe, thanks for listening to the first ever entrepreneur addiction podcast. We’ll talk to you next Monday right here at

      Cool Voice Guy: Making business loans simple, this has been the entrepreneur addiction podcast, helping you secure the capital you need, with your host Brock Blake, Dan Bischoff, and Patrick Wiscombe. Heard exclusively at

      About the author
      Dan Bischoff

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