Hacker News Reader

Definitely see how embedded lending could be a value-add for a number of businesses! Two questions:

1. Is the main draw for your customers being able to increase customer retention over time?

2. How are applications distributed to the top lenders, on the back end? Is there an auction process?

1. I think the main draw depends on the objectives of the customer. For many the priority is going to be improving retention, but for others it may be increasing revenue per user or driving adoption of another product or feature. Ultimately it all leads to higher retention, that just may not be the main draw starting out.

2. We compile data on the business as if we're underwriting them for a loan, although we never actually lend or take balance sheet risk. We use the data to place them with a batch of lenders (typically about 3) that's going to be the best fit for their risk profile and use of funds. We take the best pricing from the batch to present to the borrower. The goal is to send them to as few lenders as possible while acquiring the best pricing available on the market.

Reply on news.ycombinator.com