Intuit Inc. (Nasdaq: INTU) is launching QuickBooks Capital, an
innovative lending product that helps small businesses get the capital
they need to succeed. Building on Intuit’s long history of using leading
edge data science and machine learning, QuickBooks Capital has developed
a breakthrough credit model to help young small businesses overcome the
barriers they have traditionally faced in accessing small dollar loans.
QuickBooks Capital delivers:
The ability for small businesses to use their own QuickBooks data to
get full credit for their business performance, historical and ongoing.
A streamlined and transparent application process that is embedded
within QuickBooks so that small businesses can access funding right
inside their daily workflow, just as they need it.
New opportunities for small business growth -- 60 percent of
QuickBooks Capital customers would likely not get a loan elsewhere,
and 46 percent have never even applied for a loan before.
“The QuickBooks Capital credit model is delivering powerful results for
small businesses -- getting capital into the hands of so many
credit-worthy small businesses that otherwise felt stuck,” said Rania
Succar, head of QuickBooks Capital at Intuit. “We are particularly proud
to be innovating for young businesses because they are critical to the
future success of the economy, but very underserved by the options
available in today’s credit market.”
Taking The Friction Out Of Small Business Lending
According to a recent Federal
Reserve study, 70 percent of businesses younger than five years need
funding to grow, but only 23 percent of them get the funds they need.
Even among those who are able to access credit, more than half are
dissatisfied with the experience according to the same Federal Reserve
study. Although new young businesses are the growth engine of the
economy, generating twice as many jobs as more established businesses,
lack of funding is a top reason that about 50 percent of them fail
within the first five years.
The average QuickBooks customer needs a $25,000 working capital loan in
order to take advantage of growth opportunities, such as buying
inventory, paying for packaging so they can get their product into a
retail store or hiring an additional employee to accept new jobs.
QuickBooks Capital is tailor-made for these businesses.
Giving Businesses Credit For Their Past, Capital For Their Future
Powered by more than 26 billion QuickBooks data points and third party
data sources, the QuickBooks Capital credit model provides a powerful
view of a small business’ borrowing capacity. Small businesses are
empowered to use their own QuickBooks data to provide an automated,
comprehensive view of what’s happening with their business, including:
Free cash flow: QuickBooks provides a comprehensive picture of
cash flow because in addition to the core accounting app including
payroll and payments, small businesses also connect their bank
accounts and credit cards, as well as other third party apps to get a
full picture of their business.
Future income: QuickBooks data allows small businesses to get credit
for open invoices, work in progress, total inventory, and ongoing
Relative performance: Because there are more than 2.3M
QuickBooks users, QuickBooks makes it easy to understand how a small
business stacks up against others like them.
Trends: QuickBooks makes it easy to understand a small business within
the context of individual business trends (seasonality and growth), as
well as market trends.
In addition to delivering loans directly, Intuit is evaluating other
potential applications for the QuickBooks Capital credit model,
including enabling customers to share these data attributes with other
lenders to transform the small business lending experience more broadly.
Fast, Transparent and Integrated Borrowing Experience
The traditional process of applying for credit today is full of
friction. It sometimes requires multiple years of tax returns, business
plans and other documents and often takes several days or weeks to hear
back with a final decision. In the case of some online lenders, it can
result in very high interest rates with low transparency.
QuickBooks Capital removes all of the friction from the application
process. Small businesses that qualify for the offering can access funds
from a new “Capital” tab right inside QuickBooks, where they can always
see how much they are eligible to apply for based on the latest
developments in their business. The working capital loans currently
offered range up to $35,000, with a term between three and six months.
The product also emphasizes transparency by always displaying annual
percentage rates (APRs) to borrowers. Other than interest cost, there
are no origination fees or prepayment penalties.
Meeting the Needs of New Small Businesses
QuickBooks Capital is already making a difference for hundreds of small
businesses that were invited to use the product through a private beta.
Underserved businesses are now able to access capital: 60
percent of QuickBooks Capital customers would likely not get a loan
Borrowing is no longer intimidating: 46 percent of QuickBooks
Capital customers had never even applied for a loan before.
New businesses are using the capital to invest in growth
opportunities: 90 percent of QuickBooks Capital customers say the loan
helped their business grow. The top five uses are: (1) opportunity for
additional profit, (2) inventory or raw material purchase, (3) making
payroll, (4) equipment purchase, and (5) marketing.
There is near universal satisfaction with the product: 99 percent of
borrowers were satisfied with the QuickBooks Capital experience.
Customer Stories and Quotes -- RMU Outdoors
RMU Outdoors of Colorado is an outdoor lifestyle brand that grew out of
building custom skis. The company has often struggled to keep up with
orders due to a lack of available funding.
“In the early days we’d go out and paint houses so we could buy
materials to build the skis,” explained Mike Waesche one of the founders
of the business.
Even though they have become quite successful -- including selling their
skis internationally -- they still struggled to get the financing they
needed to expand.
“We’ve been turned down by lender after lender because we were making
money just three months out of the year.”
This year, they had the opportunity to build a Biergarten in the back of
their ski shop -- it was a great way to bring the community together,
while also solving their seasonality problems.
“When we logged into QuickBooks, we saw that financing was just
available to us. And that's what actually enabled us to put the
Biergarten together on such short notice. It was conveniently there at
the right time. The nicest part of the experience is that the funding
was directly linked to our finances. There was no discussion over ‘How
are you guys doing? Can you support this?’ It was like, ‘We understand
where you're at. We understand what you've been doing and where you’ll
go with it.’ QuickBooks Capital provided the solution for us to get out
of the seasonal business.”
Have a look at this video of RMU
Customer Stories and Quotes -- True Love Honey
Anthony Tubbiolo founded True Love Honey with $212 of savings eight
years ago and spent the first four years selling honey on the side of
the road. He has worked diligently during this time to create growth
opportunities for his business, including getting his honey into stores,
now with more than 150 commercial accounts.
He had tried to get a line of credit at least three times from a
traditional lender and had been rejected each time. Based on the
strength of his business performance, QuickBooks Capital offered his
business a $10,000 loan which he used to stock up on inventory as well
as to build his business credit for the future.
“We had found a beekeeper who had a couple of drums of honey that we
wanted, and we didn't have the money for it, and so the loan allowed us
to purchase that,” explained Anthony. “That was a nice big help. You
need working capital when you're talking about growth, and needing to
buy extra inventory so that you can offer more to the stores, and we’re
not there yet. QuickBooks is in there with your business. QuickBooks
Capital sees everything that I see, and I don't have to convince
anybody. They simply look at it, and decide that they want to invest in
your business, and if they want to, I want to.”
For additional information, please look at:
Today’s announcement is part of a series of product innovations being
announced in the lead-up to the fourth annual QuickBooks
Intuit Inc. is committed to powering
prosperity around the world for consumers, small businesses and the
self-employed through its ecosystem of innovative financial management
Its flagship products and services include QuickBooks® and TurboTax®,
which make it easier to manage small
businesses and tax
preparation and filing. QuickBooks
Self-Employed provides freelancers and independent contractors with
an easy and affordable way to manage their finances and save money at
tax time, while Mint delivers
financial tools and insights to help people make smart choices about
Intuit's ProConnect brand
portfolio includes ProConnect
Tax Online, ProSeries®
the company's leading tax preparation offerings for professional
Founded in 1983, Intuit serves 46 million customers in North America,
Europe, Australia, Brazil and India, with revenue of $5.2 billion in its
fiscal year 2017. The company has approximately 8,200 employees with
major offices in the United States, Canada,
the United Kingdom, India, Australia and
other locations. More information can be found at www.intuit.com.