Millennials Don't Want Bank Loans; StreetShares Has a Solution

Shark Tank meets eBay. That’s how StreetShares is putting together loans for small businesses and things are catching on.

Millennials say they would rather go to the dentist than a banker, according to the Millennial Disruption Index. So StreetShares is trying to make the process more pleasant. The Reston-based company was launched a year ago to connect small businesses in need of loans (up to $50k) with investors, who would compete for their business with competitive rates and terms. Co-founder Mark L. Rockefeller (pictured) says over 1,900 small businesses have signed up, although not all have filled out applications. A couple of hundred accredited investors are using StreetShares and a few million dollars in loans have been put together.

Here's how it works: Small businesses create a compelling online pitch for why they should be funded. Investors offer loans for some or all of the requested amount and the lowest interest rate bids are combined into a single loan, which allows the investors to diversify. StreetShares gets in on the deal by providing funds for the first 5% of the loan. Mark says this kind of financing is growing because of regs that make it difficult for banks to loan such small amounts. StreetShares was just named Best Investment by Harvard Business School’s 2015 New Venture Alumni Competition.

The company’s marketing strategy is to work with affinity groups, where members of those groups can lend to each other. First out of the gate are businesses launched by military veterans. Mark and co-founder Mickey Konson (pictured) are veterans, along with the entire sales team. The company has partnered with veteran-focused business groups to help get the word out about StreetShares and to direct $200M in small business loans to veteran-owned small businesses over the next four years.

Continue reading this story with a free account

Log in or register
Sign up for more articles like this
Subscribe to Bisnow's Washington, D.C. Newsletters
Related Stories

270-Unit Manassas Gated Community Sells: The D.C. Deal Sheet

BXP Closes In On Next D.C. Office Development As It Shrinks Assets

How Metropolis Is Bringing Parking Into The Future With AI And Recognition Technology

Montgomery County Approves 18-Month Data Center Moratorium

With New $250M Deal, Elme Is Fully Set To Liquidate

Simpson Thacher Appears In Talks For What Could Be One Of D.C.'s Largest Office Leases In 2026

Hines Nabs 4 Prince William Housing Sites: The D.C. Deal Sheet

AvalonBay Sells 217-Unit Community Next To Greensboro Metro

GSA Head Says Federal Government Has 'Place To Play' In Southwest D.C. Redevelopment

Downtown D.C. Office In Receivership Hits Market For Conversion

Nonprofit Takes On $105M Silver Spring Project: The D.C. Deal Sheet

Janeese Lewis George Wants To Stabilize Rent. The Question Is How