Helping Small Businesses Grow…

Biz2Credit Latino Small Business

Credit Study with Hector Barreto of The Latino Coalition and

Paul Quintero of ACCION East Tues, Sept. 30, 2014

Our Moderator today...

Anita Campbell is the CEO of Small Business Trends LLC, a media and information company. In that

role she closely follows trends in the small business market and trends in technology. She has been an

entrepreneur at heart her entire life. A lawyer by training, Anita has a wide range of interests, as

reflected in her varied background in banking, information technology, human resources, marketing and

eCommerce.

Anita Campbell

Founder, CEO and Publisher of Small Business Trends

Our Presenters today…

Rohit Arora

CEO and Co-Founder of

Biz2Credit

Hector Barreto

Chairman of The Latino

Coalition and former SBA

Administrator (2001-06)

Paul Quintero

CEO of Microlender

Accion East

Latino-owned businesses

Though they are the fastest growing segment of the

small business community, Latinos often find it

challenging to secure capital

• Funded over $1 Billion to date

• Over 1,200 lenders on our platform, including 50+ micro-lenders

• Has direct reach to over 1.6 million small and medium sized business owners

2012 - Entrepreneur.com Top Small

Business Finance Resource

2011 - Crain’s Top Entrepreneur

Biz2Credit in a few words…

Biz2Credit Quantifies Challenges Faced by Latino Small

Business Owners

• Average annual revenue for Latino-owned businesses was $69,518.56,

while for non-Latino-owned businesses, the figure was $86,501.47.

• The average credit score for Latino-owned businesses was 611.7,

compared to 622.3 for all others.

• Average operating expenses were lower at $20,981.19, contrasted with

$29,455.54 for non-Latino businesses.

Biz2Credit Quantifies Challenges Faced by Latino Small

Business Owners & Entrepreneurs in Securing Financing

Hector Barreto

Chairman

The Latino Coalition

Latino-owned companies

• There are over 3 million Latino-owned U.S. businesses

• Figure is expected to double in five years.

• Generate an estimated $500 billion in sales annually.

• Securing capital is still a challenge

Where are Latino businesses growing?

The short answer is everywhere!

Where are Latino businesses growing?

• The top states for Latino-owned small business loan applications on

Biz2Credit.com in the past two years were: California (20.3%), Florida

(20.2%), Texas (14%), New York (11.7%), and New Jersey (4.2%)

• These five states represented more than 70 percent of the loan requests

made by Latinos in the past two years.

• There are vibrant Latino communities in places such as Chicago, Denver,

and Charlotte.

The Top 5 States for Latino-Owned Small

Business Loan Applications

Challenges for Latino Entrepreneurs

• Because language is sometimes a barrier, the application process can be

intimidating

• Some people don't have a lot of experience borrowing money from banks

• People with poor credit histories -- or none at all -- can be difficult to find a

bank that will give an aspiring entrepreneur a chance (They often must turn

to high interest, non-bank lenders, such as cash advance companies)

Young Latinos Are Entrepreneurial

"The young generation of Latinos -- both immigrants and first or second

generation Americans -- are very entrepreneurial. We must mentor them

better, create role models in the community and help them take their

companies to higher levels. I'd also like to see more Latinos enter the

booming e-commerce and technology sectors in Silicon Valley and

elsewhere.”

Hector Barreto,

Chairman of The Latino Coalition.

Where to Find Funding

• Loan programs designed to help Latinos -- and others – who live in

economic empowerment zones

• Options besides “name brand” big banks include regional banks, credit

unions and microlenders

• Alternative lenders typically approve more than half of the small business

loan requests

The SBA

• SBA.gov provides links to Minority Business Development Centers

(MBDCs) that can connect Latinos with training courses and other

assistance

• The SBA sets has a network of Small Business Development Centers

(Centros de Desarrollo Empresarial) that offer networking opportunities and

advice

• The 8(a) Business Development Program helps socially and economically

disadvantaged individuals through a wide range of assistance programs

• The agency provides assistance in both English and Spanish

Paul Quintero

Executive Director of Accion East, a leading

non-profit microlender

Biggest challenges for Latino small

businesses in search of funding?

• First time entrepreneurs sometimes have poor credit histories -- or no credit

history at all.

• Microlenders like Accion are willing to give people a chance who might not

be able to secure a loan from a traditional bank lender

Can I qualify for a loan if I have bad credit?

• Yes!

• Accion requires a minimum 525 FICO Report score – a number lower than

most “traditional” lenders will accept

What is Role of microlenders?

• Accion East offers affordable microfinance solutions

• Since 1991, Accion has provided over $132 million in over 20,000

microloans

• Funding helps grow small companies, create jobs, and strengthen

communities

What types of loans does Accion make?

• Established Business Loans (loans of up to $50,000)

• Emerging Business Loans (loans of up to $30,000 to help companies

achieve profitability)

• Transition Business Loans (loans of up to $30,000 for the purchase of an

existing business)

• Sprout Loans (small loans to help get startup businesses up and running)

• Promesa Loans (loans for startup entrepreneurs with little-to-no credit

history)

How long does the process take?

• Typically 2-3 weeks, if the applicant has all the necessary documentation

• Applications are done online and completed in just a few minutes

• No need to fill out tedious paper forms!

Biz2Credit - Step-by-step application process for

SMB borrowers

Borrowers create an account and apply for loans

for free

Pre-qualify for multiple loans and compare options

in the Biz2Credit system

Select the best product and finish application

either online, or with the help of a Loan Specialist

1

2

3

Biz2Credit/TLC Registration Page

Biz2Credit Initial Loan Application Form

Instant Pre-qualified Matches

Customers can either finish the application for a specific loan product online, or work with a Loan

Specialist to complete the process

Complete Application Process 1

For many lenders, you can complete the entire application on Biz2Credit, receive a real-time offer, and

get funding within a few days (*some on the same day!)

Complete Application Process 2

Upload all necessary documents, store them for record keeping, and share them with any lender!

Timeframes & Expectations

Timeframes for receiving funds

• Personal Asset Loans: Same Day

• Cash Advances: Days

• ACCION Micro-loans: 1 week

• Traditional Loans Between $5,000 - $150,000: 1-3 weeks

• Traditional Loans > $150,000: 2-4 weeks

*Biggest reason for delays: Document gathering

FAQ’s

Is there a cost to the customers?

• No. Registration is free, takes four minutes and enables borrowers to see

loan product matches

• Typically, customers also do not pay anything to Biz2Credit secure loans

How do we differ from competitors?

• Biz2Credit does not pass along info until the borrower chooses a lender

• Biz2Credit only receives revenue if the customer obtains a loan

• Biz2Credit has a network of over 1,300 lenders and has arranged more than

$1.2 BILLION in loan products for all types of small businesses

Helping Small Businesses Grow…

Q&A