On Deck Capital Inc. operates a platform for online small business lending.
The company offers a range of term loans and lines of credit customized for the needs of small business owners. It offers equipment finance loans and in Canada, a variable pay product. The company provides loans to customers in 700 different industries across the United States, Canada and Australia.
The company’s platform touches various aspects of the customer life cycle, including customer acquisition, sales, scoring...
On Deck Capital Inc. operates a platform for online small business lending.
The company offers a range of term loans and lines of credit customized for the needs of small business owners. It offers equipment finance loans and in Canada, a variable pay product. The company provides loans to customers in 700 different industries across the United States, Canada and Australia.
The company’s platform touches various aspects of the customer life cycle, including customer acquisition, sales, scoring and underwriting, funding, and servicing and collections. Enabled by its proprietary technology and analytics, the company aggregates and analyzes various data points from dynamic, disparate data sources, and the relationships among those attributes, to assess the creditworthiness of small businesses. The data points include customer activity shown on their bank statements, business and personal credit bureau reports, government filings, tax and census data. Small businesses could apply for a term loan or line of credit, 24 hours a day, 7 days a week, on its website and, using its proprietary OnDeck Score, the company could make a funding decision faster.
The company also offers bank clients a technology and services platform that facilitates online lending to small business customers through its subsidiary, ODX, LLC (ODX). ODX provides bank and financial institution clients a solution package consisting of platform-as-a-service technology modules, consultative analytics and business process services, and real-time origination services support to enable digital small business origination solutions.
Market and Solution
The company offers a suite of financing options, through term loans and lines of credit, tailored to meet the needs of small businesses throughout their life cycle. The major five states in which the company, or its issuing bank partner, originated loans in 2019 were California, Florida, Texas, New York and New Jersey, representing approximately 14%, 9%, 9%, 6% and 4% of its total loan originations, respectively.
Loan Distribution Channels
The company sources its lending customers through three diverse distribution channels: Direct Marketing, Strategic Partners and Funding Advisors.
Through its direct marketing channel, the company makes contact with prospective customers utilizing direct mail, outbound calling, social media and other online marketing.
In its strategic partner channel, the company enters into agreements with third parties that serve or otherwise have access to the small business community, who then introduce it to prospective customers. Strategic partners include, among others, small business-focused service providers, other financial institutions, financial and accounting solution providers, payment processors, independent sales organizations and other websites. Strategic partners conduct their own marketing activities, which might include email marketing, leveraging existing business relationships and direct mail.
Through its funding advisor program, the company makes contact with prospective customers by entering into relationships with third party independent advisors, known as funding advisor program partners (FAPs), that offer various financial services to small businesses. FAPs conduct their own marketing activities, which might include direct mail, online marketing, paid leads, television and radio advertising or leveraging existing business relationships. FAPs include independent sales organizations, commercial loan brokers and equipment leasing firms. FAPs act as intermediaries between potential customers and lenders by brokering business loans on behalf of potential customers. As of December 31, 2019, the company had active relationships with approximately 400 FAPs.
Strategy
The key elements of the company’s strategy are to expand in each of its distribution channels and optimize its funnel; continue to optimize decisioning models; expand loan offerings and features; grow international businesses; grow ODX; and extend customer lifetime value.
Subsidiaries
The company conducts certain of its operations through subsidiaries that support its business. It offers bank clients a technology and services platform that facilitates online lending to small business customers through its ODX subsidiary.
Intellectual Property
The company has registered trademarks in the United States, Canada, and Australia for OnDeck, ODX, OnDeck Score, OnDeck Marketplace, the OnDeck logo and other trademarks.
Government Regulation
The company is a commercial lender and as such there are federal laws and regulations that affect its and other lenders’ lending operations. These laws include, among others, portions of the Wall Street Reform and Consumer Protection Act, the Equal Credit Opportunity Act, the Fair Credit Reporting Act, Economic and Trade Sanctions rules, the Electronic Signatures in Global and National Commerce Act, the Service Members Civil Relief Act, the Telephone Consumer Protection Act of 1991, and Section 5 of the FTC Act prohibiting unfair and deceptive acts or practices.
History
On Deck Capital, Inc. was founded in 2006. The company was incorporated in Delaware in 2006.
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