Numerated is a rapidly growing fintech company in Boston. The company's real-time lending platform helps smaller regional and community banks compete against the global banks in the industry.
Today, the company is announcing $8M in funding. We connected with Dan O'Malley, Numerated's Founder & CEO, to learn more about the company and the round of funding.
What is Numerated and what is the problem that you are solving?
Numerated powers the digital transformation of lending at banks. We offer a real-time lending and growth platform that enables banks to profitably grow their loan portfolios and meet consumer expectations for on-demand financial services.
The traditional lending experience for business owners, for example, requires them to visit a branch, fill out a long application, often wait weeks for the bank’s underwriters to decision the loan, another visit to the branch to sign documents, and then ultimately wait for the funds to hit their account. For banks that work with Numerated, this entire process is automated—from filling out a short pre-populated application and credit decisioning to signing documents and having funds hit the business owner’s account—takes less than 5 minutes.
This real-time experience not only attracts customers to a bank and leaves them amazed by the simplicity and convenience, it transforms what was an unprofitable and stagnant business line for the bank into a profitable growth driver.
There is particularly high urgency for regional and community banks to implement the platform, because it allows them to out-compete the largest national and global financial institutions that have been stealing market share in their local markets in recent years. We offer regional and community banks a holistic platform to win back market share by combining this real-time lending customer experience with modern bank marketing and sales tools that identifies eligible applicants, drives awareness for the real-time product, surfaces actionable data for more intelligent loan sales, and ultimately enables anyone in the bank to close a loan.
Congratulations on your new round of funding! What are the details on this round of funding, and how do you plan to use the capital to accelerate the business?
We’ve raised an additional $8M from our current investors including Venrock, FIS (largest bank technology company in the world), and FINTOP Capital.
We’re also welcoming Raj Date, the founding Deputy Director of the Consumer Financial Protection Bureau during the Obama administration, as an investor and Advisor.
The capital will be used to meet market demand for our platform, which has exceeded our expectations, and to scale our operations alongside this customer growth.
What’s the background story of the company and its founders?
While Numerated as a company is only 18 months old, our technology has a much longer history.
The platform was initially developed within and for Eastern Bank here in Massachusetts—the largest and oldest mutual bank in the U.S.—to help the bank address both declines in branch foot traffic and increased competition from national financial institutions offering businesses a more convenient, digital way to access capital.
This digital lending technology grew Eastern’s business loan portfolio 4X into the #1 small business lender in Boston, enabling them to out-compete large financial institutions like Bank of America and American Express. With other banks hearing of this success story and having interest in licensing the technology, we spun the technology out as an independent company in 2017.
Prior to leading Eastern’s fintech incubator and Numerated, I spent time in both banking and fintech, including online bank PerkStreet, Capital One, and Oliver Wyman.
What are the key features of the Numerated platform?
Behind the scenes, at the core of what we do is intelligently harnessing data for banks to utilize in determining whether or not they want to extend a loan or line of credit to a borrower.
We do this today in business banking by assessing the eligibility of every single business in a bank’s footprint against a digitized version of the bank’s credit policy. In doing the credit underwriting work in advance, we can offer the borrower a remarkably personalized, fast and convenient application experience. The fastest borrowing experience we have enabled—from beginning the 5-question application to having funds transferred to their account—has been 2 minutes and 57 seconds. This contrasts dramatically to the weeks, if not months, that it can take an applicant to secure a loan traditionally with a bank. We call this “real-time lending.”
Additionally, we offer the bank’s marketing, banker, and branch staff growth tools to drive loan portfolio volume. For example, the email marketing automates the sending of personalized, targeted emails to businesses in a bank’s footprint who are eligible for a loan. As another example, we offer branch and banker sales tools that surface top prospects in their markets to sell to, such as a customer making a loan payment to an alternative or national lender.
What's the size of your team now? What's your plan for hiring over the next year or so, and for what type of roles?
Today we are 46 people. The interest we’ve seen from banks of increasing size and complexity has exceeded our expectations, and we’ve grown our team quite substantially in order to keep pace with customer growth. In the last 3 months alone we’ve grown our team over 50%, and in the last 6 months we’ve more than doubled the size of our team. We are moving into a new office space in a couple weeks to support additional growth across the company in 2019.
What's the future outlook for Numerated?
The future is bright for Numerated, with a proven product that is built by and for bankers matched with urgency in the large bank market to adopt digital lending capabilities. While today our platform supports business loans and lines of credit, we look forward to expanding the platform to support additional bank products where convenience is king.