Credibility Capital is a lending platform focused on prime credit small business borrowers. The Company matches businesses with institutional investors to fund loans ranging from $10,000 to $350,000. Investors include banks, hedge funds and family offices with an appetite for current income.
As an early stage investor and the current largest shareholder in Credibility Capital, Stibel & Co. has been instrumental in expanding the technology-enabled lending platform that helps small businesses gain access to transparent and affordable loans. Brett Baris, Co-founder and CEO of Credibility Capital, has personally known Jeff Stibel for 25+ years, dating back to their days at Tufts University, where the two young entrepreneurs first cut their teeth in business together. Stibel and Baris have collaborated on a number of investments, culminating with the early investment in Credibility Capital that Baris cofounded in 2013.
Here’s what Baris had to say about the quarter-century relationship and how Stibel & Co. has shaped their business strategy over time.
Co-Founder & CEO, Credibility Capital
Q: How did you first come to work with Jeff Stibel?
A: I started one of my first business ventures in college. The year was 1995 and my partner was close friend and fellow Tufts alum Jeff Stibel. Jeff and I came up with a very simple concept – purchase gourmet coffee beans in bulk and sell them by the pound via mail order/catalogue. We chose a simple name: “Just Beans.” While Jeff and I spent months and months researching the concept and conducting market research, we missed the big picture. The Internet was just starting to develop as a medium for online shopping. And Starbucks, which completed its IPO just a few years earlier, hadn’t yet reached unicorn status. The coffee trend was coming, but unfortunately the venture never really got off the ground (our inventory was stolen!) and we missed out on what could have been a massive opportunity.
The failure of “Just Beans” didn’t deter either one of us. Shortly thereafter Jeff started Simpli.com, an innovative search engine company that was founded long before Google was a household name, and I was fortunate to be a (small) early investor and informal advisor. I went on to become a partner in a VC fund and often collaborated with Jeff and his team on a number of fintech opportunities.
Ultimately the entrepreneurial spirit was too difficult for me to suppress. Close to 20 years after the experience with Just Beans, I left my VC job to co-found my own fintech platform Credibility Capital with another close friend Mark Rambler. This time, Jeff was there to support me with guidance and advice. Jeff helped shape the idea of Credibility Capital, a lending platform providing fair, transparent capital to established small businesses, and remains one of the largest shareholders. We’ve come a long way from the days of “Just Beans!”
Q: What do you think Stibel & Co. was drawn to in Credibility Capital?
A: In many ways, Credibility Capital is a data-driven growth company consistent with Stibel & Co.’s investment strategy. Our goal is to match small businesses with access to capital. We gather a myriad of data elements on US small businesses that we use to make smarter commercial lending decisions (e.g. approving and pricing loans). We also use data to target high-quality small business customers. Using many of these data elements, we’ve developed a proprietary Credibility Capital Risk (CCR) Score to analyze and score risk. That score is periodically back-tested and recalibrated by our data scientists to improve predictability. I believe this commitment to data and small businesses aligns perfectly with Stibel & Co.’s values.
Q: In what ways has the Stibel & Co. team added value to Credibility Capital?
A: The Stibel & Co. team has been instrumental in the strategic planning for our business. In particular, Jeff Stibel has provided my co-founder and me with guidance from the beginning as we designed our business from its earliest conceptual stage. It was Jeff who stressed the partnership aspect of our business model to drive down the cost of customer acquisition, enabling Credibility Capital to pass on the savings to our clients in the form of best-in-class, low-APR loans.
Q: How has Stibel & Co. shaped the growth of your business?
A: Their strategic planning and guidance was followed up by introductions to key individuals at Dun & Bradstreet, which ultimately landed Credibility Capital with its first borrower acquisition partnership. This was a critical milestone for the business as Dun & Bradstreet has been an integral Credibility Capital partner for 4+ years, enabling Credibility Capital to provide approximately $100 million in capital to 1,000+ businesses in 44 US States.
Q: Were there any unexpected benefits in working with the team?
A: When it came time to build out our technology platform, Stibel & Co. partner Aaron Stibel was helpful in recommending a system architecture and even introduced us to technology resources that proved to be helpful to us our organization as a whole. Aaron also oversaw the API development connecting Credibility Capital to Dun & Bradstreet. Through this API, leads are seamlessly passed in real time from D&B sales reps to our loan specialists.
Q: What do you believe has been the most impactful contribution from the Stibel & Co. team?
A: Credibility Capital has benefited tremendously from the experience and insights of many members of the Stibel team. In the early days of Credibility Capital, Stibel & Co. partners Peter Delgrosso and Judy Hackett helped us identify the need for our product and the size of the market opportunity. They helped us design and administer surveys and focus groups revealing that, after the 2008 crisis, business owners who were seeking less than $350,000 of capital were no longer being served by their local banks. Furthermore, it became evident that business owners were being offered improperly-disclosed short term, daily pay, high-APR loans, and desired a more transparent, monthly pay, fully-amortizing term loan. This is the product that we’ve been offering since 2015: transparent, fair term loans from $10,000 to $350,000.
Q: Has the Stibel & Co. network connected your company to others?
A: As we launched our business and started originating loans, members of the Stibel & Co. team have continued to make critical introductions to others including strategic partners, innovative SMB data resources, and even a fantastic small business, which we were able to lend $200,000.
Pete and Judy also invited us to participate and speak at their Access-to-Capital conferences across the country, providing the first real exposure for Credibility Capital. In fact, one NYC event resulted in my first ever tv appearance – an interview by Kate Rogers of CNBC!
The team has proven to be a consistent and invaluable resource to us in ways we could never have imagined.