Fintech One•On•One

Luke Voiles of Pipe

Feb 9, 2024

Luke Voiles, the CEO of Pipe, discusses the challenges of small business lending and how Pipe is revolutionizing the space. He talks about their unique working capital product, the importance of payments data for underwriting, and why vertical SaaS companies are the new community banks. Luke also shares his thoughts on regulatory matters, including Section 1071 of Dodd-Frank, and explains how Pipe is accessing the capital they need to lend.

41:48

Episode guests

Luke Voiles

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Episode notes

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Quick takeaways

The success in solving the small business lending problem lies in narrowing the problem and having the right tech teams, focusing on real-time transaction data and payments to underwrite loans accurately.

Accessing and analyzing real-time transaction data allows for accurate underwriting and risk assessment, helping reconcile the variation in financial management practices across different businesses and mitigating risks associated with individual businesses.

Deep dives

The Importance of Narrowing the Problem and Having the Right Tech Teams

The success in solving the small business lending problem lies in narrowing the problem and having the right tech teams. Many alternative lenders lack the necessary technology and APIs to provide a seamless and efficient lending experience. The key is to focus on real-time transaction data and payments to underwrite loans accurately and provide pre-approved offers. This ensures a frictionless experience for small businesses seeking capital.

Introduction

2min

Luke's Background in the Fintech Industry

2min

Joining Pipe: A Clear Purpose and Unique Opportunity

4min

Expanding the TAM, Becoming a Market Maker, and Changing Customer Acquisition

4min

Merchant Finance and Multi-Draw Line of Credit

14min

Regulatory Matters: Section 1071 and Fair Access to Financial Products

16min

Small business lending is still not a solved problem in this country, or anywhere around the world for that matter, despite a decade or more attacking the problem. But today, we are seeing some new business models and new go-to-market approaches that have the potential to make a huge difference.

My next guest on the Fintech One-on-One podcast is Luke Voiles, the CEO of Pipe. Luke has been around fintech for many years and he became CEO of Pipe about a year ago now. He has a different perspective on small business lending and how to make it work best for the lender which he goes into in some depth in this episode.

In this podcast you will learn:

Some of the big names in fintech where Luke has had leadership roles.
Why he decided to take on the CEO role at Pipe.
What he did in his first weeks as CEO to fully understand the state of the company.
How he describes Pipe today.
How their working capital product works and where they sit in the payments flow.
The size of the small business they will lend to.
Why it is so important to get the payments data for their underwriting.
How they inject themselves into the payments flow so they are paid first.
Why vertical SaaS companies are the new community banks (see Luke's article here).
Luke's thoughts on Section 1071 of Dodd-Frank and why it is a good thing for fintech.
How Pipe is accessing the capital they need to lend.
Why we haven't yet solved the small business access to capital problem.
Why they are not concerned with the expense side of a business.
The vision for Pipe for the next five years.

Connect with Luke on LinkedIn
Connect with Pipe on LinkedIn

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