Fintech Takes x Fundbox presents Engineering the SMB Capital Stack Episode 1: The State of SMB Lending

13 snips

Nov 4, 2025

Prashant Fuloria, CEO of Fundbox and an expert in small-business lending, dives into the current landscape of SMB credit. He discusses stark trends from the Federal Reserve's findings, revealing that many SMBs are struggling to thrive. Rising costs and shifting borrower behaviors are impacting lending dynamics. Prashant also explores how embedded finance is reshaping lending practices, the challenges standalone lenders face, and the importance of aligning banks and fintechs for sustainable growth. This insightful talk is a must-listen for anyone invested in the future of SMB capital.

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INSIGHT

SMBs Recovered But Are Not Thriving

The 2025 Fed small business credit survey shows SMBs have bounced back but revenues remain below pre-pandemic levels and optimism is mixed.
Rising costs, uneven cash flow, and higher self-reported debt are driving financing stress and shifting application patterns.

INSIGHT

Hidden Defaults Mask Distress

Many small businesses quietly default rather than formally declare bankruptcy, masking stress in standard metrics.
Self-reported debt levels increasingly explain why owners think they get denied financing.

ANECDOTE

Real SMB Stories: Repair Delays And Cost Shock

Prashant recounts conversations with customers facing rising repair and input costs, like truck repair delays and expensive burger ingredients.
Platforms ask Fundbox to offer purchase or payroll financing to help businesses manage these pressures.

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Welcome to our new miniseries, Engineering the SMB Capital Stack, sponsored by our friends at Fundbox.

This four-part series digs into small businesses, small business lending, and the forces reshaping how small businesses access capital.

In Episode 1, I sit down with Prashant Fuloria, CEO of Fundbox (and my cohost for the episodes that follow).

We kick things off with The State of SMB Lending, level-setting with data from the Federal Reserve’s 2025 report on small business credit (based on a 2024 survey of 7,600 business owners).

For the first time since 2021, small businesses were more likely to report that revenues decreased rather than increased in the year prior to the survey. Translation: SMBs are surviving; not thriving.

Then, we zoom out from the data to consider why costs are rising, why some businesses are defaulting instead of declaring bankruptcy, and how embedded finance is changing both borrower behavior and lender economics.

Prashant brings the long view of Fundbox’s credit data to the table: how performance differs across industries, why CAC still kills standalone lenders, and how alignment among banks, fintechs, and platforms is the only sustainable model.

It’s a foundational conversation for anyone tracking the next decade of SMB capital: rich with data and grounded in the here and now (with a clear sense of where the stack’s heading!).

Subscribe now to catch what’s next: candid, can’t-miss conversations with leaders from Plaid, Stripe Capital, and Lead Bank!

This episode was brought to you by Fundbox.

As a leading capital infrastructure provider behind the digital SMB economy, Fundbox is focused on enabling platforms to embed financial tools directly into their user experiences. Learn more here.

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