On Deck Capital

At On Deck, we’ve been making a concerted effort to spend more time with our local customers such as Dirty Bird To-Go and La Pasta Bistro Grill. We’re always interested to learn more about the business owner’s journey, especially how they’ve been able to grow. That’s why we were thrilled when one of our customers Ben Bohen, owner of Waterfront Wines, offered to host a wine tasting for us at his Brooklyn-based retailer. 

Amid tasting wine and teaching us the differences between vintage years, Ben spoke about his journey to becoming a small business owner. Having spent 10 years working in the restaurant industry, Ben took his passion for wine and a desire to be his own boss and opened Waterfront Wine & Spirits in 2011.  

Located in the burgeoning neighborhood of Brooklyn Bridge Park and inside of a residential condo building, Ben and his partners focused on growing the business organically during the first year. Although they had solid success, Ben wanted to invest heavily in marketing and inventory without disrupting his daily cash flow. After finding On Deck online, his interest was piqued after learning how quickly we could deliver capital. A few short days later, he had the funding he needed to invest in the business.

On his experience, he said “We hadn’t had too much experience with lenders, but On Deck has set the bar pretty high. Our sales representative was prompt, courteous and honest. With the money we were able to invest in the business, we’re trending towards 25% growth this year.”

We wish Ben and the Waterfront Wines & Spirits Team the best of luck! If you’re New York City-based, be sure to check out their store. 

Continuing in the tradition of Dirty Bird To-Go, the On Deck Team took a trip to one of our local customers La Pasta Bistro Grill in the West Village last week. After dining on the authentic Italian food, we sat down with owner Nazmul Chowdhury to learn more about his experience as a restaurant owner. 

In the restaurant industry for over 20 years, Nazmul purchased La Pasta Bistro Grill from his mentor a few years ago. Being located in a student and tourist laded area created a seasonal cash flow issue for Nazmul. He needed financing to manage cash flow during his slow season, but found his bank’s process too time consuming for his schedule. 

After finding On Deck online, Nazmul decided to apply after learning how fast we can deliver capital. From start to finish the process took him 2 days, and Nazmul had the funding he needed to prepare for the tourist heavy Spring season. 

We wish Nazmul and the La Pasta Bistro Grill Team the best of luck, and look forward to your success!

After we closed our Series D back in February, we had some additional interest from other equity investors. With On Deck growing at a rapid rate of 100% in the past year, several investors stood apart as being really valuable partners to work with as we scale. 

We’re excited and humbled to officially announce a $17 million expansion to our Series D led by Google Ventures (the venture capital arm of Google), with participation from Peter Thiel (PayPal co-founder and one of the first investors in Facebook) and Industry Ventures. This is a phenomenal group of new investors that further cements our position as a leader in the world of tech-enabled finance.

So, what does this mean for the future of On Deck?

Simply put, it means easier, faster, and more capital for more business owners nationwide. This add-on financing will provide us with the resources to further our mission of helping small businesses grow – through better products and a superlative customer experience. Our goal is to power every U.S. small business loan, and we can’t wait for what’s to come. 

Continuing in the tradition of Colorado: Let's Grow Together – a contest that celebrated our new Denver regional office by awarding $10,000 to a local business, r+d Wine Shop – we’re excited to introduce our next installment, New York City: Let's Grow Together. Launched on the heels of our Bloomberg visit, we asked New York City-based business owners to tell us on Facebook how an extra $10,000 would help them grow.

We received incredible entries from all five boroughs and a wide range of industries, and then narrowed it down to our top 5 based on uniqueness and aspiration: Baybee Lounge Daycare, The Thrill Mill, Danica Cosic Designs, Roy Teeluck Salon and Price Optical. Then we asked our readers to vote on who wins the grand prize.

And the winner is….drum roll please….BayBee Lounge Daycare! The second place winner, The Thrill Mill, recieved $5,000 and third place, Danica Cosic Designs, a counseling session from the staff at On Deck. We couldn’t be more excited for our winners, and look forward to their continued successes. 

1. Explain what you do in your role with On Deck.

NP: I develop and implement various lending policies and credit models that help On Deck provide small businesses with access to capital in an efficient and intelligent manner.

AD: I develop innovative ways to improve our credit policy so we can extend loan offers to more business owners. This includes assessing portfolio performance, looking at new data sources, building statistical models and sharing the analysis with the management team and our investors.    

2. Why did you decide to join On Deck?

NP: When I was interviewing, the team promised me one thing above all else:  if I had a good idea and I was enthusiastic about it, I wouldn’t get caught up in bureaucracy trying to make it happen. Happily, On Deck has not broken its promise.

AD: I wanted a chance to develop my analytical and coding skills while still working in a field where I'd be able to apply my field of study (economics and mathematics). This and the welcoming, positive environment I experienced during my interview is what made working at On Deck so appealing.

3. In your opinion, what is the best part about working at On Deck?

NP: While all finance shops are innovating in terms of their credit analytics, the inertia of old and proven methods make it harder for change to actually happen. Nothing could be further from the truth here at On Deck. The fact that we are a young company working in a rapidly evolving sector of lending means we are constantly discovering and utilizing new ways of doing business.

AD:  Hard work pays off! Everyone is extremely receptive to new ideas and positive contributions never go unrecognized.

4. What advice would you give to someone looking to join the company?

NP: I would tell someone to really think about the needs and challenges of a small business you are familiar with. Looking at our loan products through our customers’ eyes is integral to what we do and that understanding will help you flourish at On Deck.

AD: If you’re looking to solve challenging problems alongside some really smart and creative people, then this is the place to be. Everyone here is truly dedicated to what they do, and working in an environment like this will inspire you to work harder and improve every single day.

5. What would someone be surprised to know about On Deck?

NP: The number of meetings we have is quite limited. Most of our conversations are informal and impromptu.

AD:  We are very customer-oriented! Whether it be creating a new product, credit policy, or developing any new initiative, customer experience is always at the forefront of our decision-making.

On Tuesday, I had the opportunity to appear on Fox Business’ Money with Melissa Francis to discuss the potential for increasing banking regulations. As CEO of On Deck, I wake up every morning thinking about how to connect Main Street to capital. To be honest, before this I hadn’t given much thought to the public policy discourse around ‘too big to fail’ banking regulation until this recent leak about a proposed bill from Senators Vitter and Brown resulted in my appearance on MONEY.

We’ve had our heads down building On Deck for the last few years, and Dodd-Frank, Basel III and other regulatory measures that impact our large banks have been largely out of scope for us. But as I was preparing for the interview, it really hit me just how much more regulation could further reduce banks’ willingness to lend to Main Street. The increased regulatory scrutiny on banks over the past 5 years has forced them to be inwardly focused – dealing with troubled portfolios and complying with new regulations. What has been pushed aside is the innovation that would allow banks to profitably lend to Main Street businesses, resulting in a dramatic decline in banks’ small business lending over the past 5 years from pre-crisis levels.

The current regulatory environment has made what On Deck does even more important to our local communities. We have developed innovative technology to successfully deliver capital to Main Street, where there is a huge need for working capital loans that allow business owners to buy inventory, purchase new equipment and hire more employees with a defined Return On Investment (ROI) over a short period of time.  Whether we do it on our own or partner with banks to help them do it (and we have a number of bank partnerships in place), it’s clear to me that scaling On Deck is a must do not just for our own company but also for the small business sector as a whole.

So am I for or against the proposed Vitter Brown bill? Hard to say. We clearly need a healthy banking system that’s not ‘too big to fail’ and we also need to make sure that regulation isn’t overly burdensome. What I am for is Main Street, and what I want to make sure of is that the voice of small business gets represented in this debate, and that we keep a focus on economic growth.

Last week, the On Deck Team took a trip downtown to support one of our long time customers Dirty Bird To-Go. After sampling the delicious cuisine (fried chicken, mac-n-cheese and garlic kale), we sat down with owner and founder Joseph Ciriello to learn a bit more about the history of the Dirty Bird.

A seasoned restaurateur, owner Joseph Ciriello opened the original Dirty Bird in Chelsea in 2006 to provide a healthier, fresher alternative to typical fast food. All of the produce is free range, antibiotic-free and grown locally.

After a few years of growth, Joseph needed financing to purchase inventory to keep up with the rising demand.  After being denied by his bank in 2011, he decided to reach out to On Deck at the suggestion of a friend. Since then, he’s taken three loans with us, steadily increased sales, opened a new location in TriBeCa and even rubbed elbows with Mayor Bloomberg.

We wish Joseph and the Dirty Bird Team the best of luck, and look forward to their continued success!

It was a pretty epic week for the On Deck Team. CEO Noah Breslow was featured in Forbes; we announced our Colorado: Let’s Grow Together winner r+d Wine Shop; and New York City Mayor Michael Bloomberg officially “opened the doors” to our new offices at an inaugural press conference. With our rapid growth – increasing employee count by 100% and doubling our office size – the Mayor underscored On Deck’s contribution to the booming New York City technology industry.  Alongside the Mayor, we were honored to be joined by NYC Chief Digital Officer Rachel Haot (the brains behind the #madeinny campaign), New York State Senator Brad Hoylman, and Joseph Ciriello, the owner of Dirty Bird To-Go (an On Deck customer) . To celebrate the new office launch, we're giving one deserving NYC-based business $10,000 - visit our Facebook page for more details. 

We started the event by welcoming the Mayor to our new NYC headquarters.

Then, CEO Noah Breslow gave the Mayor a tour of our new offices while explaining our commitment to innovation and job creation.

Noah detailed recent data points and highlighted our 117% compound annual revenue growth. 

After the press conference concluded, we gifted the Mayor an On Deck baseball bat - he joked that he'd take it to opening day at Yankee Stadium!

To help celebrate the opening of our new regional Denver office, On Deck is giving one deserving Colorado business $10,000 to help grow. We received hundreds of incredible entries from a wide range of local businesses, and narrowed it down to our top 5 based on uniqueness and aspiration. Now, it’s up to you – our readers – to decide who wins the grand prize - A2 Interative Media, Circle Fresh Farms, Grand Valley Zoological Center, The Über Sausage or r+d Wine Shop. Visit us on Facebook to vote and show your support.

The business with the most votes will receive $10,000, second place $5,000, and the third place winner will earn a counseling session from the staff at On Deck. The winner will be announced March 27th - vote today!

While in Denver to launch our new regional office last week I was able to visit one of our new customers, Denver-based Granite & Marble Designs.  I got to bring along our SVP of Marketing Andrea Gellert and General Counsel Cory Kampfer to get a behind-the-scenes look from Owner and Founder Michael Clifton. 

We met up at their offices, which also holds their warehouse and fabrication facility. As an engineer, I really enjoy watching how things are made, and it was fascinating to see all of the raw material, equipment and people required to turn stone into beautiful kitchen counters.  

Mike and I discussed the challenges and opportunities of starting and operating a business through the financial crisis of 2008. For Mike, his exposure to the housing industry forced him to be highly customer focused and financially disciplined to get through it. I’ve experienced similar challenges building businesses through difficult times in the economy. I’ve found it helpful during those times to remember the advice of tennis champ Rafael Nadal: “Play the point, not the match.” Staying focused on near-term objectives is key for business owners when demand slows – cost control and winning that next piece of business are essential, and grand visions need to be put on hold for a while. 

In typical Denver fashion there was a blizzard with almost 10 inches of snow before I arrived, but it was business as usual for Michael and his team. We shared a good laugh about how different the reaction would have been in New York City!

After I warmed up, we chatted about Michael’s background in the stone fabrication and installation industry, and the challenges he has faced growing his business. Michael is a phenomenal salesperson and experienced operator in the industry. After working for another stone fabrication firm for several years, he struck out on his own with only 3 employees and a family loan. Now, Michael now has 16 people working under him to cater to his growing customer base, which includes major homebuilders in Denver, local businesses, and even professional athletes!

However, earlier this year, Michael needed additional financing to take on more employees, inventory and equipment to accommodate his rising customer demand. Michael found On Deck through his payment processing relationship with Heartland Payments – On Deck has been providing Heartland Payments customers with affordable, fast financing for years. He and his Head of Accounting, Deanna Flores, appreciated how straightforward and quick the application process was relative to other financing options. The Granite Team had the funding they needed within a few days. As a CEO, it’s always encouraging to hear positive feedback from our customers about partners and process.

Witnessing Michael’s commitment to his craft and employees was truly inspiring. His ability to turn raw product into beautiful finished pieces was incredible, and we wish him and his team the best of luck!

This week, On Deck reached a major milestone by opening its new regional office in Denver, Colorado. Our new West Coast operations are already home to 16 employees, and we’re looking forward to expanding to over 200 in the next two years. To commence the opening, we were honored to be joined by Colorado Governor John Hickenlooper and Denver Mayor Michael B. Hancock at an inaugural ceremony for local On Deck customers, business partners and government officials. The Denver community welcomed us with open arms, and we were humbled by the media coverage of the event.

Denver was a natural fit for the On Deck team; in addition to helping us better serve businesses in the Mountain and Pacific Time zones, state and local officials are strong supporters of the On Deck mission.  

To celebrate, we’re launching Colorado: Let’s Grow Together, a contest to connect one deserving business owner to $10,000. To enter, business owners can visit our Facebook page, and tell us in 100 words or less how an extra $10,00 could help our business grow. 

This week, the On Deck Team sat down with the brains behind Thank You Small Business – the movement to raise awareness about the impact small businesses have on the national economy. As a big supporter of the grassroots movement, we wanted to share Carissa’s story and let others know how they can get involved.

Connecting Main Street to capital is vital, and serves as a vehicle for helping the overall economy. Studies show job creation, community outreach and “green” practices all tie back to small business. As a company, we're dedicated to helping small businesses grow. That’s why we want to start sharing helpful information and data on the state of the small business economy that not only benefits our customers, but also sheds light on how individuals can support their local small businesses.

A study in the Chicago area found that $68 of every $100 spent at an independent business stays in the local economy. Compare that to the $43 per $100 that big chain businesses spend locally, and you'll understand just how vital small businesses are to the local economy. Studies done in Portland, Maine and Salt Lake City, Utah returned strikingly similar results.

For all its importance, small business is fighting for a place in consumers' hearts. National market shares of locally-owned retail shopping businesses declined 11% from 1990 to 2009. For food-related businesses, they dropped from 71% to 64% in the same period.

Despite the bad news of market shares, local grocery and clothing stores are beginning to see growth in sales. And for employees, wage growth was higher in small businesses with fewer than 100 employees.

But small businesses are more than the pulse of a local economy—they're the lifeblood of their communities. Small businesses have created 65% of all new jobs for more than a decade. They also employ a little over half of all workers in the United States. Local business success provides a national boost. Without small business, the nation's unemployment rate would be much higher than its current 7.9%.

In addition, shopping local helps reduce your carbon footprint, as many independent businesses also shop local themselves. This means the goods you buy don't have to travel as far, saving on transportation costs and fuel.

Boosting Small Businesses: The Shop Small Movement

Fortunately, awareness about the importance of small businesses to both the local and national economies is growing. In the last few years, a number of new campaigns and organizations launched to promote support for small businesses.

Community First Fridays are one example. All over the country, cities invite residents to spend their evenings with independent stores, food, art, and live entertainment on the first Friday of the month.

Perhaps the best-known of these campaigns is Small Business Saturday, which started in 2010 and quickly gained traction.  Their aim is to draw attention to local businesses during the busy shopping period during Thanksgiving weekend. As of 2012, it has amassed tremendous awareness and support from elected officials in every state, dozens of corporate supporters, and more than three million “likes” on Facebook.

Shift Your Shopping began in fall of 2011, partnering with 38,000 businesses in 150 communities across the U.S. and Canada. The campaign encourages residents to take their local economy into their own hands by choosing independent shops over chains. It's a year-round campaign with a strong focus on the holidays. Their site provides a map of "shop local" community initiatives around the country.

Independent We Stand is a movement similar to Small Business Saturday and Shift Your Shopping, also with a year-round focus. They offer marketing materials, economic impact calculators, and a blog with articles, studies, and links to help promote the benefits of the shop small movement.

How You Can Get Involved

It's easy to support the shop small movement:

●     Seek out small, independent businesses in your local community.

●     When possible, avoid shopping at big box stores and other large chains.

●     Buy produce and other products from your local farmer's market, or directly from nearby farms.

●     Shop local businesses before you shop online.

If you own a business, look for local vendors before reaching out to large, national vendors. In addition to supporting your local economy, you may even save some money.

You can also help spread the word to family and friends about supporting their local community’s small businesses as well. Some campaigns offer materials specifically for that reason, but it's also as simple as sharing a status on your favorite social network like Facebook or Twitter.

In addition to supporting your community and saving money, you may enjoy some old-fashioned customer service by shopping local. There's nothing like walking into a store, being greeted by name, and knowing that your business is truly appreciated.

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Yesterday, the On Deck Team announced it has raised $42 million in Series D growth financing led by a new investor, Institutional Venture Partners (IVP), alongside current backers RRE Ventures, SAP Ventures and First Round Capital.

It was an exciting day over at our NYC headquarters, with plenty of media buzz from Bloomberg, TechCrunch and AllThingsD. Flattery aside, this announcement signifies On Deck’s ability to continue to connect Main Street businesses nationwide to the capital they need to grow, as well as accelerate our growth through continued technology innovation, breakthrough product development and increasing our marketing reach. We also want to give a warm welcome to Sandy Miller, On Deck's newest Board Member and seasoned IVP General Partner. 

Our fearless leader Noah Breslow explained to us, “On Deck will provide more capital to small businesses in 2013 than it did during the previous five years in total. This investment provides On Deck with greater capacity and resources to bring technology-enabled finance to the mainstream of the American small business market,”

For more information, follow us on Twitter (@ondeckcapital). You can read our press release here. 

The On Deck Team was thrilled today to learn we'd been named to the Forbes' List of Most Promising Companies in America. Coming in at #94 alongside some of the best and brightest in the country, we're excited to be placed among the fastest growing companies in America.

Here at On Deck, we talk a lot about small businesses and how we’re helping them grow.  We’ve put out detailed data, we’re constantly polling our customers, and we’ve posted many testimonials. But this year, we want to take it one step further. Whenever I’m traveling, I’ve started to visit customers and get a firsthand account of their experience as a small business owner, and how they’re using our small business loans. 

When I was on the West Coast last week, I was lucky enough to visit Furry Tales Doggy Daycare, and chatted with owner Lena Botwright about her business, the obstacles she has faced, and how she is planning on growing her business. 

When I first arrived, Lena gave me a tour of the doggy day care center she opened 5 years ago. 

I was really impressed by her vision for the business, her dedication to her employees and her passion for animals. Lena has done a really nice job of building multiple revenue sources for her business. She “hosts” dogs during the day for working dog owners, she boards dogs when families go on vacation, and she also sells pet supplies and provides grooming services. 

To provide all these services, she has to staff her business 24/7, and it was clear from the smiling faces I saw as I toured the office that Lena has found a team of employees who are as dedicated to great animal care as she is. 

Then, we got to business. Lena told me about the difficulties she’d faced accessing capital over in the last few years. She needed financing to upgrade her facility and purchase equipment, but she was flat out denied by her bank and found merchant cash advances way too expensive.    

After finding out about On Deck, she applied online and began communicating with one of our loan specialists, Mike.  Within a few days, she had the capital she needed to purchase new equipment so that she could service more customers. 

It was great seeing Lena’s commitment to her business – she has managed to expand her business during very challenging economic conditions over the last few years. Now, she is using her On Deck loan to help her business grow further, and it was exciting to hear about Lena’s plans to provide more great services for dogs and their owners.

Plus, I got to call hanging out with these cute puppies "work"! :) 

On Deck is excited to announce its role as a sponsor for “Thank You Small Business,” a movement to create awareness and support small businesses nationwide. The campaign is seeking to raise the general public’s awareness about small business’ true impact on the economy. According to TYSB, small businesses accounted for 68% of new jobs created between 1993 and 2011. We felt furthering TYSB’s mission was a natural fit for On Deck, and we’re looking forward to helping to spread the word.

1. Explain what you do in your role with On Deck.

I explore, develop, and contract financial institutions such as independent sales organizations, small business funding advisors, leasing brokers and other companies to strengthen the business’ sales with On Deck. By helping expand their operation or fine-tune efficiencies, I increase our partners’ profitability and units sold for On Deck.

2. Why did you decide to join On Deck?

Joining any young company comes with certain risks. But, with Noah Breslow’s vision and the backing of our “all star” board which consists of some of the most prominent business people known today, the decision was a no-brainer.

3. In your opinion, what is the best part about working at On Deck?

The company’s culture and our collaborative and open environment. Also, at On Deck, talented individuals are really recognized and integral to the company’s growth. Knowing that I can create my own career path with hard work and success is what gives me the energy to do better each day.

4. What advice would you give to someone looking to join the company?

This is a very quickly growing company, and the fast pace isn’t necessarily for everyone. But, if you plan to work hard and be diligent, you will have an opportunity to build a career for yourself.

5. What would someone be surprised to know about On Deck?

It’s not necessarily surprising, but more so impressive how dedicated everyone is here. Especially for a younger company, to find so many like-minded individuals striving for the same goal is difficult to find.

The On Deck Team had a record breaking year in 2013 with a growth rate of over 100% and more than $350 million delivered to small businesses nationwide.  By tripling the number of distribution partners to 1,500 nationwide, expanding our bank partnerships, and unveiling the On Deck API, we continued to advance our mission of bringing Main Street closer to capital than ever before.

We made substantial progress this year in connecting this historically underserved market to capital. A few highlights:

• Repeat customers grew to 34%
• 93% of customers would recommend On Deck to another business
• In just 90 days after taking an On Deck loan, the average business grows revenues by 24%
• On Deck improved distribution and lending ability across many industries. Range of industries served shot up 171% to 725 different types

To read more about how our CEO Noah Breslow thinks we’re going to continue our progress in 2013, click here.