The sky’s the limit for GreenSky, who’ve just filed a U.S. IPO with a goal of raising $100 million in their first round.
Their innovative online platform which allows creditors to process and approve credit applications at the initial point of sale (and almost instantaneously) has seen continued success as it’s provided effective loan services for Americans across the nation. By removing the waiting process that’s generally attached to loans in the market GreenSky are operating within, they’ve been able to revolutionise the loan application process, providing easy finance solutions that can be offered via contractors and service providers in a move to streamline the service process. Although consumer finance is a crowded market, GreenSky have proven themselves as a unique offering year after year in the twelve years they’ve been in operation.
Founded in 2006, GreenSky’s core motivation was to provide credit underwriting technologies specifically shaped towards the home improvement, elective healthcare and retail industries in the U.S. The benefits to consumers are significant: while many would often be deterred at the idea of having to find finance for the cost of, for example, the installation of a new roof, GreenSky enables the roofing company themselves the opportunity to offer that customer instant credit access at the point of sale. Not only does this benefit the end consumer through the removal of heavy paper-driven applications, lengthy delays and time-draining forms and background checks, but it’s also of great value to merchants who can point to GreenSky as a finance solution. Sales increase, speculative quoting activity is more regularly rewarded through a contract and sale, and customer processes are streamlined, increasing productivity and profitability. GreenSky’s loans provide a solution for everyone, and remove many of the points of tension that are traditionally problematic in the personal loan industry.
From the beginning, GreenSky Credit has made a point of differentiating itself in the technology start-up market.
CEO David Zalik has set a course from the beginning that has been adhered to by the growing team. Instead of using press and media attention to grow the perceptions of success, GreenSky have remained quiet while they’ve worked hard to build relationships with banks and merchants across the nation. These relationships have proven their staying power, allowing GreenSky to continue to offer services to hundreds of thousands of consumers.
Now, the company is taking a huge step forward in their filing for an IPO. With a reported $5 billion valuation, the future is looking bright – and there’s a heavily motivated team in place to ensure GreenSky continues to deliver on the value it’s provided to partners on every side of the equation in its decade-long journey to this IPO. With such a successful history behind it, eyes are on this company with expectations of success as they take their operations public.
Zalik has been able to leverage the power of close bank relationships in order to position GreenSky in a unique way that minimises the company’s risk and maximises its profit potential. By transferring the risk of the loans to banks themselves (including SunTrust, Regions and Fifth Third), GreenSky Credit is able to continue to provide functionality for loans to be written without placing itself in the risk position of loan provider. It continues to benefit from this position year-round, as banks then pay GreenSky a percentage of loan balances each year as a generation and service fee.
The real magic of GreenSky’s offering lies, however, in its methodology.
By empowering contractors to pitch their loans on their behalf, they’re able to keep motivated sales teams working across the country, without paying a single commission or carrying any overhead cost. They’ve created a workforce of contractors that’s over 17,000 strong, who can directly pitch home improvement loans to customers at amounts of up to $65,000. Not only do they secure business for GreenSky, but they also pay GreenSky a percentage of the loan amount in recognition of the business it generates for their own books.
GreenSky Credit understood from the beginning the importance of a simplified customer process. Consumers apply via their phones, and receive decisions (complete approvals, not pre-approvals) within mere seconds. Their desire to create a streamlined and strategically simplified customer process has set the company apart in the race for consumer credit.
GreenSky has done its homework before coming to the IPO table.
With five years of profitability behind it and an estimated recorded revenue of $250 million in 2017, the company stands out from a sea of competitors in the lending space who have struggled to prove a profitable business model for years.
Led by a level-headed David Zalik, who worked hard to bootstrap the company for its first eight years of business before bringing in any outside money, GreenSky Credit has proven its staying power and market adaptability.
By combining an army of motivated opportunity generators whose workforce sits on other company’s overhead books alongside the stability of asset-rich financial lenders, GreenSky Credit sits uniquely and prominently as a force to be reckoned with as consumer finance continues to evolve. Many companies will need to be playing catch up: when it comes to making the loan process as simple as pie, GreenSky turned up in first place long before anybody else even thought to get in the game.
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