Become, the Israeli startup that operates a business lending marketplace to give SMBs more funding options, has closed $10 million in Series A investment. In addition, the company — formerly known has Lending Express — has raised $2.5 million in venture debt.
The round is led by Benson Oak Ventures and Magenta Venture Partners, with participation from RIO Ventures Holdings, iAngels and Entrée Capital. The debt funding is provided by Viola Credit.
Claiming that the small business lending landscape is “fundamentally flawed,” with 58% of SMBs denied access to funding, Become’s platform uses technology to give each business a “LendingScore” based on how fundable its algorithms think it is. This is supported by a personalised plan and monitoring system to help SMBs become more transparent and therefore viable to lenders.
The Become marketplace then allows multiple lenders to offer tailored offers to the businesses registered on the platform and compete for an SMB’s custom loan. “This gives each SMB the power to compare and choose the loan that’s right for them, directly from Become’s platform,” says the fintech.
“The lending sector is fundamentally flawed, with many SMBs unable to get loans,” explains Become founder and CEO Eden Amirav. “The process of applying for a loan is often time consuming and confusing, and big bank approval rating sits at just 27.5%.”
To compound this, he says that the lending market is fragmented, consisting of hundreds of alternative lenders, and SMBs don’t know which to choose. “Without the tools to navigate, many end up contacting the wrong lender. There may be some lenders, for example, that have a better loan product or rate that better suits their business.
Finally, the lack of transparency throughout the process leaves SMBs completely in the dark. If denied funding, SMBs don’t know exactly why or how to qualify.”
To remedy this, Become lets SMBs view all funding options in a single place so they can make a “financially savvy” decision after careful comparison. The entire process is online from start to finish, with Amirav claiming that funding is made possible in as little as 3 hours. “Become’s LendingScore improves business’s fundability in order to help them qualify for more and better funding options,” he adds.
With regards to competitors, Become competes with both lending marketplaces and business profiling products. The former includes Fundera and Lendio, while Nav is a competitor in the business credit profiling space.
“What sets Become apart is that [we are the] only truly online marketplace from start to finish,” says Amirav. “For the first time, the whole process from application to funding can be completed entirely online, using [our] API, and without the need for offline activity. Become’s technology continues to search for optimal funding options and notifies customers if more suitable, better options are available.”
Meanwhile, Become says it will use the funds to scale its operations in the U.S. and Australia.
It claims 200,000 business owners registered on its platform, supported by an ecosystem of more than 50 lenders and partners, including PayPal, OnDeck and Kabbage. The fintech, which has offices in San Francisco and Tel Aviv, has facilitated more than $165 million in business loans to date.