On Deck Capital: The Small Business Ally

Situation Analysis

In the beginning of 2008, there were early signs that the economy was about to take a turn for the worse.  Housing prices were already on the decline, stocks were taking a hit in certain sectors and other key indicators signaled an inevitable ‘doom & gloom’ forecast.  The early fallout from all this was already taking shape, with major financial institutions having overextended themselves, particularly through sub-prime mortgage lending.  And the domino effect just took off from there.

One severe casualty from this economic crisis was and continues to be the American small business.  Small businesses that make up the backbone of our economy not only saw a significant decline in revenue, they found themselves crippled while futilely attempting to obtain working capital to either sustain or grow their businesses.  Traditional banks, historically very stringent with small business loans to begin with (doling out less than 7 out of 10 loans to all  applicants), tightened their lending standards even more, leaving the lending well just about dry.

• Small business produces roughly half of the private GDP and between 60 percent and 80 percent of net new jobs.
• About 7 percent of the U.S. population is in the process of starting a business at any given time.
• The estimated 25.8 million small businesses in the United States:
  • Have generated 60 to 80 percent of net new jobs annually over the last decade
  • Employ 50.6 percent of the country’s private sector workforce
  • Represent 97 percent of all the exporters of goods
  • Represent 99.7 percent of all employer firms
  • Generate a majority of the innovations that come from United States companies

Source: U.S. Small Business Administration

The American small business entrepreneur, the local shop owners across Main Street America, were in dire need of a fast and fair financing solution.  The ever-present predatory Merchant Cash Advance companies (aka as MCAs) were widely viewed as the equivalent to a ‘pay day lender,’ offering great sums of instant cash, but at exorbitant interest rates.  What exacerbated all of this was the fact that resorting to these MCAs never solved the problem, and often resulted in a further downward spiral for the business owner.  The market was ripe for a viable and fair financing solution that would pick up where banks left off.  Enter, On Deck Capital.

Strategy

Position On Deck Capital as the ’small business ally’ — the accessible lending resource that would not only provide a necessary lifeline for small businesses that were the key engine of our economy, but would help them strengthen their operations and improve their overall credit rating over time. Ultimately, our goal was to firmly demonstrate how On Deck could provide a means by which small businesses could return to banks for future, traditional lending needs.

Our approach was to underscore On Deck’s ability to pick up where banks have left off, and ensure that entrepreneurs weren’t ‘forced’ into resorting to other alternative financing options, often the ones that end up irreparably crippling small businesses.  For us to succeed, we needed to highlight On Deck’s unique lending system, one that incorporated proprietary technology that looked at the overall health of a business, not just the personal credit score of the business owner.

Implementation

Knowing that we had a timely and relevant story to tell, we determined that we would catapult On Deck Capital into the mainstream conversation through a series of strategic media placements and key influencer outreach.  For launch, we wanted to hit a broad audience through a widely read print outlet.  We also knew that our core audience, small business owners around the nation, were most likely reading a mainstream daily newspaper such as USA Today.  We timed this story to run the day we issued our official launch press release.  For our broadcast unveil, we secured a feature segment on the popular Fox Business News with Neil Cavuto.

Following launch, we then worked to introduce On Deck to other key consumer and business media.  Through well thought out and timed introductions, we were able to secure coverage across a number of top tier outlets, including Associated Press, Reuters, CNN.com, BusinessWeek, and a large feature story in The Wall Street Journal, to name a few.

To sustain momentum in the months past launch, and once a base of clients was amassed, we then targeted top regional markets in which On Deck Capital had clients for stories on alternative financing featuring On Deck Capital, but told through the lens of a local client.  Secured placements included feature coverage in the Boston Herald, San Francisco Chronicle, Dallas Morning News, and Crain’s NY and Crain’s Cleveland business journals.

Another key component of our program was to directly connect with small business owners through the trade publications they read on a regular basis about their particular industries.  Whether the restaurant business, nail salon industry or packaged goods sector, we secured feature coverage across dozens of top trade publications.

Each piece helped generate important awareness around On Deck Capital, but also worked to further their business objectives by driving new customers, building credibility in the investment community and helping to promote strong interest from key strategic partners.

Sample Media Results

• Los Angeles Times
• USA Today
• VentureWire
• Business.com
• Associated Press
• CNN.com
• CNNMoney.com
• Wall Street Journal
• INC.
• Reuters
• BusinessWeek
• Dallas Morning News
• Phoenix Business Journal
• Boston Herald
• SmartMoney.com
• New York Enterprise Report
• Orlando Sentinel
• CBS2
• BusinessWeek
• Crain’s Cleveland Business
• Market Talk
• Crain’s New York Business
• Dallas Business Journal
• Restaurant Finance Monitor
• Crittenden’s Restaurant Insider
• Stores
• Investor’s Business Journal
• Yahoo! Finance
• Kiplinger Letter
• Reader’s Digest