Note from the Publisher: We recently featured Stephen Sheibaum in our 3 Questions series (see the interview here), and the firm he founded, Bizfi, has a somehwat unique lending strategy, relative to other P2P lenders. While the P2P sector has had a tough year (see our recent piece P2P Loan Defaults Up), Sheinbaum likes the strategy of combining both a balance sheet lending practice with offers from other lenders, somewhat like the model Progressive Insurance uses in its marketing. The approach differentiates BizFi, as they continue to grow.
“Bizfi has transformed and morphed since its launch in 2005. Founder Stephen Sheinbaum started the company as a balance sheet lender but around 2009 started seeing more loan demand than the young company could fulfill. So the company opened itself up to other funding partners, and now provides an experience where business owners can come and receive automated, real-time quotes from bank and non-bank lenders who can provide all types of financing.
It’s the 45 lending partners, 15 of whom are directly integrated into the Bizfi platform, that differentiate the company from some of its competitors, which include CAN Capital and OnDeck. While other lenders have what Sheinbaum calls their credit “box”, having a marketplace alongside Bizfi’s own lending offering gives customers a lot of choices for financing. “Think of us like Progressive, with our own offers next to our peers,” he said.
Since inception, Bizfi has enabled almost $2 billion of loan originations, using its own balance sheet to still fund about 30 percent of the $20 million monthly done on the platform.”