How a Serial Entrepreneur Turned a $50K Award into the Largest Marketplace for SMB Loans
Brock Blake built Lendio to help small business owners navigate the complex web of business lending
Brock Blake is a lifetime entrepreneur and current CEO of Lendio, the country’s largest marketplace for small business loans. His entrepreneurial spirit began to blossom when he took on a paper route as a young boy. From there he moved into larger ventures like starting his own soccer camp business and purchasing scooters from China and selling them locally.
Throughout all his entrepreneurial adventures, Brock never held a traditional job. Shortly after graduating from Brigham Young University, Brock entered an entrepreneurship competition similar to The Apprentice. After beating out hundreds of applicants and going through an 8-week bootcamp with 20 other finalists, Brock and his encyclopedia-reading cofounder Trent Miskin, whom he met while they were both studying at BYU, took their $50,000 winnings to create FundingUniverse. It’s a platform that connects small business owners to angel investors. After realizing that most of their customers don’t need venture funding, they started working on a spinoff that provides small business owners much-needed loans.
Now after 8 years in business, Lendio has helped more than 70,000 small businesses get access to over $1.5B in loans to start and grow their businesses. There’s a charitable component, too. For every loan facilitated on Lendio’s marketplace platform, Lendio Gives, the employee contribution and employer matching program, donates a percentage of funds to low-income entrepreneurs around the world through Kiva.org.
In addition to giving back, Brock is a believer in maintaining personal balance. He can often be found playing competitive basketball at 6:00 am and often gets lost in early morning reading. In this Q & A, he shares his inspiration and things he’d do differently in his journey building Lendio.
What was the inspiration behind Lendio?
Before we started Lendio, we had a company called FundingUniverse. We were connecting entrepreneurs to angel investors and VCs. Thousands of small business owners and entrepreneurs came to FundingUniverse looking for financing, so we knew the demand was very high for capital. However, most businesses were Main Street businesses like restaurants, landscapers, or dry cleaners; they didn’t need to raise venture funding to the tune of $500K, $1M, or $5M. As it turned out, only 1 to 2% of business owners that came to us to look for angel or VC financing actually secured it, and having to turn away the other 98% wasn’t a great business model.
So Trent, my cofounder, and I started thinking about how we could create a model to help the masses of small business owners in need of financing. We came up with the concept of Lendio to connect them with lenders instead of investors. We started working on it on nights and weekends. We started redirecting some traffic from FundingUniverse to Lendio to start testing things. We had all these assumptions and hypotheses around how the business model would work and how we were going to generate revenue; of course most of these were wrong. But we tested and tweaked and optimized along the way. We’ve gone through multiple business model iterations over the years. In fact, we launched Lendio in 2011, but we didn’t settle on our core business model until about 2014.
What are the key pain points that Lendio solves for its customers?
Business lending is very different from consumer lending. With consumer lending, you’re looking for the best rate, and most lenders offer the same exact loan product. Business lending is less clear-cut. There are lines of credit, term loans, SBA loans, working capital loans, commercial real estate loans, equipment financing, and so on. When you go to a bank, apply for a loan, and get declined, you might think you’re getting declined because you have bad credit. But the reality is you went to a bank that doesn’t offer the loan product you qualify for. It’s like going to a Chinese restaurant and ordering pizza. You’re looking in the wrong place. This is the pain point that Lendio solves for: we simplify the process of getting a business loan by helping business owners navigate through all the options available to them, in one convenient place.
How have you leveraged your partners to help Lendio grow?
A big part of Lendio’s growth initiatives and investments are planned around growing through our partners. For example, we have a partnership with Heartland Payment Systems, which provides merchant processing solutions for hundreds of thousands of small business owners across the country. Anytime those customers need a loan, they can go to Heartland and apply through a tool that’s powered by Lendio. We have about 50 different partnerships where we are offering the partner’s customer base the ability to get a loan through either a co-branded or white label experience.
What’s been a mistake you’ve made that you think other entrepreneurs can learn from?
Giving away too much equity early on in scenarios that weren’t deserved. I’m not talking about raising money from investors — that’s part of the journey and a normal part of the transaction. I’m also not protective around equity when it comes to my employees — I want them to have as much equity as they can — that gets me really excited. But sometimes, you give partners equity and then realize they’re not on board for the long haul.
For example, Lendio once traded equity for marketing services that turned out to be a complete flop. We generated tens of thousands of revenue dollars, yet we gave away millions of dollars of equity in the trade. Early on, when you’re trying to be smart with cash it’s very easy to give away too much equity; I think this is a very common, painful learning experience for most entrepreneurs.
Can you share a productivity hack you swear by?
As a CEO, you get caught up in what’s urgent versus what’s important. If you’re only doing the urgent stuff, there’s not enough time in the day to get everything done because so many things get rolled up to you. You end up just trying to keep all the balls in the air. To solve for this, I have two calendars: a strategic calendar and my actual calendar. My strategic calendar maps out an ideal week that allows me to spend X amount of hours on emails, meetings, and special projects. This way, when I’m booking my calendar, I’m booking it based on strategic blocks that have already been carved out on my calendar as sacred time.
What are the benefits of building your business in Utah?
- The quality of life in Utah is high, which attracts really strong talent. There’s not only great engineering talent, there’s really strong sales talent here, too.
- The cost of living in Utah is quite a bit lower than a lot of other places.
- The family-oriented culture is a big part of what attracts people to Utah. Utah also has a great outdoor environment that’s attractive to people who enjoy hiking, camping, rock climbing, water skiing, golfing, or cycling.
The combination of those benefits have helped Lendio attract really strong talent and build a fun, high-producing workplace culture.
I’m also on the executive board of an organization here in Utah called Silicon Slopes. They’ve done an amazing job helping strengthen the local business community. Every year, the Silicon Slopes Tech Summit attracts 20,000 people from all across the country, over the Sundance Film Festival. The organization also provides monthly networking events and speakers, including CEO roundtables. The tech and business communities in Utah are thriving; it’s a hot market. A lot of money is being raised here, and there have been a few significant IPOs just in the last 12 months. We have a fantastic community for entrepreneurs here.
As a self-proclaimed serial entrepreneur, what’s the best part of helping other entrepreneurs with small business loans? Do you ever see yourself in a “traditional job?”
No, I don’t ever see myself in a traditional job role. I’d like to keep going down this path of championing and supporting other people who have that entrepreneurial spirit and fire, on their paths to success. Career wise for me, there’s nothing that could be more fulfilling than building a company, overcoming the challenges that come with it, and helping to fuel that ambition in others as well.
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