Ep. 124 - Own What Matters: The Modular Lending Playbook, with YouLend

Ted Kirk (0:00)

If lending isn't table stakes already in the payment space, it's pretty close. Whenever folks are running data studies on funded sellers, funded merchants, they find that the ones that take funding grow sales 25%, 35%, sometimes even 100% faster than their peers who don't take the financing. Traditional financial institutions just don't do a great job with underwriting small businesses that are doing sub 500,000 in annual revenue, will be funded over 400,000 businesses lifetime. So we've just kind of been around the block. At its lightest touch form, there's zero development resource required of our partner. Sometimes we'll meet platforms and they have, it's called a partner page, right? And they think, you know, if people want financing, they'll be looking at our partner page and they'll find it. I've never seen it work.

Kara Parkey (0:57)

Welcome back to The Payments Shed. Today, we are joined by Ted Kirk, who runs Strategic Partnerships for the US. Ted, thanks for joining us. Thanks for coming to the studio.

Ted Kirk (1:05)

Thanks for having me, Kara.

Kara Parkey (1:06)

Awesome. Let's start with you. Maybe tell us a little bit about your background and what led you to YouLend.

Ted Kirk (1:11)

As we were saying earlier, the through line for the last decade or so of my career has been building partnerships to distribute fintech products. So spent some time at AFS, which is like more in the fraud prevention space, spent some time with Trove in the kind of payroll data aggregation space, and then joined YouLend coming up on four years ago to lead partnership acquisition in the US.

We launched in September of 22 in the States. I joined in October of 22 and my charge has been doing partnership deals with tech, payments, e-commerce brands, folks that serve lots of merchants and would like to offer capital to their constituent merchants.

Kara Parkey (1:54)

That's awesome. You were first business development hire in the US, right?

Ted Kirk (1:57)

Yeah, it's been a wild ride. So I think we've gone from single digits employees up to probably 75, give or take based on the States now, well into the hundreds of millions in annual origination in the US.

Lots of great partners helping us do that. So it's been fun.

Kara Parkey (2:15)

Lots of growth. Well, that leads me to my next question. So for anyone that doesn't know the business, maybe describe what is YouLend and what are you guys doing?

Ted Kirk (2:24)

Yeah, so I think you can think of us as just a way for SMBs to access really badly needed working capital. So we're a SMB financing provider. We're going to market exclusively through strategic partnerships. So we don't do any, you know, we're not buying Google traffic. We're not acquiring customers directly.

Our only path to market is by partnering with again, kind of tech, payments, e-commerce, sometimes some accounting software, really any kind of tech enabled platform that serves, say, 5,000 or more small businesses.

And then typically is either in the flow of funds for those small businesses, like a key part of how they collect revenue, or in the case of the accounting packages, sometimes it's just having visibility into the flow of funds of those businesses. Any platform that kind of fits those buckets is a good partner for us. And so we've been at it for coming up on 10 years, the company is based in London, we operate in the US, the UK, and then eight other markets in Western Europe. And kind of scale-wise, this year we'll do billions of dollars, euros, pounds in origination, we'll probably do hundreds of thousands of individual deals. So we're just a very high-volume small business financing provider, and again, all through partnerships.

SPEAKER_3 (3:46)

That's amazing, that grows in four years.

Kara Parkey (3:49)

So is the US the most recent market for you guys, or plans to expand into others?

Ted Kirk (3:53)

Yeah, so we, I think we tend to be really partner-led with kind of geographic expansion, rather than like if we build it, they will come approach. We tend to look for a partner that we're working with in another market. We have a trusted relationship. We know that they kind of get it vis-a-vis how to take this product to market, and then expand with them as kind of our tip of the spear partner into a new market. So the US is our most recent expansion. I guess in the year 2022, we went from, I think it was four markets up to 10 So in 2022, I came on board to lead partnerships in the US.

We hired somebody to lead partnerships in Germany. We hired somebody to lead partnerships in Spain. Hired somebody to lead partnerships in Poland. And actually, I've realized I misspoke. France is our most recent market. We went live in France probably second half of last year.