Ethan Senturia wants DealStruck,his startup which specializes in securing loans for small businesses, to be around for the next 40 years — even if that means surviving a few economic downturns. To do that, the company said it raised $8.3 million in venture financing today. The company also said it secured a $50 million credit facility as part of the financing announcement.
“Anyone who gets into the business looks back over the course of 100 years, and knows in the next 100 years, there’s gonna be a downturn again,” he said. “I’m certainly not an economic forecaster, but I can tell you from our perspective as a lender, we have structured products tied to the needs of our business owners. Even in a downturn, the structure of those products will help them better use capital and help us work them through it.”
DealStruck specializes in lending money to small businesses, usually in loans that range from $50,000 to $500,000. Once a business signs up and seeks a quote on a loan, DealStruck works with services like credit agencies to pre-qualify that business. Then, to continue the process, DealStruck will access the company’s bank accounts to validate through third parties that they are active. A few days after that, DealStruck is able to provide a response and an offer.
The majority of this can be done digitally, but businesses seeking a loan through DealStruck can also contact salespeople at the firm. The company is located in San Diego, partially because people in Southern California have a lot of financial expertise and there are a lot of salespeople, Senturia said.
“Throwing a thousand engineers at the problem won’t solve it — it relies on domain expertise, a long history of people who have seen long cycles, and understand how assets perform,” he said. “While you’re using tech to make intelligent credit decisions, you’re really administrating a lending product, that requires experience. Half our team really comes from commercial lending.”
While the funding will help with headcount, much of it is driven by tech and marketing, he said. Though, it probably won’t be spent on billboard advertising: “Our CMO would probably be cringing right now,” he said.