Access to Capital: Reimagining The Lifeline of Small Businesses

As I’ve written before, current data suggests that we are in the midst of a slow, but steady economic recovery. Yet one of the most critical areas where we are not seeing enough recovery is small businesses’ ability to access capital.

Intuit Small Business Index

Image: The latest Intuit Employment and Revenue Index shows small businesses added 10,000 new jobs in March. Unfortunately, small businesses are lagging behind the rest of the economy. While overall employment has risen 4.5 percent in three years, small business employment has risen only 1.4 percent over the same period.

Small businesses want to grow and they want to hire people to help them grow. To do this, they need access to the financial resources that will allow them to hire new employees and help drive economic growth both in their communities and in our nation as a whole.

Unfortunately, too many small businesses today are facing increasing difficulty when it comes to accessing the capital they need:

  • 43% of small business owners said that in their need for funding they have been unable to find resources – loans, credit cards or individual investors.
  • 29% of small business owners reported that their loans and lines of credit have been substantially reduced over the last four years. And 1 in 10 had their lines of credit and or loan called in early by the funding source.
  • Overall, 53% of businesses have been unable to grow their business or expand operations, including hiring, due to lack of capital and 32% have reduced their employee roles.

This needs to change. Small businesses play a vital role in creating jobs and growing the economy. It is incumbent on industry, government and financial institutions to find new and innovative ways to ensure that small businesses can access the capital they need.

At Intuit, we are piloting a new service called QuickBooks Financing, which will help small businesses obtain capital faster and at lower rates from lenders. The service also helps lenders make more informed risk decisions, increasing the potential for small businesses to obtain a loan quickly.

We know there is much more than can be done by us and others. I urge lenders to be innovative – look at other ways to verify a small business’s assets rather than what is just on its books. As the backbone of the economy, small businesses should not be excluded from receiving a loan, simply because there are not financial assets on the books. Get creative!

I am also interested in what you think about this important issue. In particular, I would love to hear your ideas on what is the one thing that banks, government, and industry could do differently in order to help small businesses today.

Let me know what you think in the comments and I promise I will bring the best of these ideas with me as Intuit engages with all of the key stakeholders on this important issue.

*This blog originally appeared on LinkedIn. You can follow Brad Smith on LinkedIn here.

Love at First Use: Three Tips for Building Awesome Products

It’s said that you never get a second chance to make a first impression. Nowhere is this more true than in product development. You may have built a truly amazing product, full of wonderful features that deliver lasting value to customers, but if you don’t have an amazing first-use experience, it’s game over!

In today’s world, first impressions matter more than ever before. Prospects have little patience for friction or confusion. In a mobile-first world, potential customers will download and test-drive our app, and if it doesn’t deliver some benefit or WOW in its first impression … they press the app until it wiggles, hit the X, and go searching for a better solution.

This new reality has motivated us to take a fresh look at our first use experiences, and our observations have led to three guiding principles to successfully introduce customers to our products:

  • Time-To-Benefit: Make sure that the customer immediately sees how and why they would use the product. Resist the temptation to reveal all the great long-term benefits, but instead, focus on getting to real core customer value in a simple, fast and approachable manner.
  • Ease (Do It For Me): Only ask for the absolute minimum information to get started. Once you ask for it, don’t ask again. Every request for information introduces friction and can reduce conversion significantly.
  • Emotional Delight: Go beyond functionality and surprise your customers. Make the most important tasks easier than expected. Seek to create moments of “Wow!” that will generate positive word of mouth.

A great first use experience is the front door to powering growth for a new or existing product. Don’t let all the hard work that goes into creating a great product be sabotaged by not putting in the time and effort of designing a delightful gateway. None of us want to see the next thumb being placed on our wiggling app to delete it!

*This blog originally appeared on LinkedIn. You can follow Brad Smith on LinkedIn here.

Perspectives from Intuit CEO Brad Smith: Opening up your Platform Requires a Mindset Shift from Ownership to Outcome

The world has shifted from a paper-based, human-produced, brick-and-mortar bound market to one where users understand, appreciate and embrace the benefits of truly connected services. As a result customer expectations are changing. Customers expect products to work seamlessly across devices. They expect to have their other efforts aggregated or harnessed into something you provide so they don’t have to do re-work. Customers want to have a 360 degree view of their lives or business, not just what you provide. And they want it all to be personalized for them.

On top of that new devices are launched every day and the pace of platform change has moved from six years to six months.

We are operating in a world where no one company can solve all of their customers’ problems. We have to shift our mindset from ownership to outcome.

Meeting that demand can be a technological challenge for any provider, especially in financial services. This morning I had the opportunity to join a panel of CEOs at the BAI Retail Delivery Conference in Washington D.C. We discussed the future of financial services and tackled this very topic.

Some bankers may be reluctant to open up their platform. But to remain relevant, they will have to. Opening up empowers a financial institution to incorporate the contributions of others, solve a wider array of specific customer challenges and, ultimately, delight those they serve. And, with higher engagement comes better revenue opportunities for all involved.

Intuit data shows that customers now interact with their financial institution via the digital branch more than any other way. A recent Intuit internal study showed that our financial institutions’ online customers interact with their financial institution’s website approximately 10 times per month.  When mobile is added, users interact roughly 19 times per month. And, those who access using online banking, mobile banking and tablet banking access their accounts approximately 30 times per month.

At Intuit, we’re finding new ways to open our products and platforms so that our customers and third-party software developers can help us add value to our products, even while we sleep. Recently we opened up the APIs to our financial data services and our digital banking platform.

In this new digital world, we’re committed to unleashing the power of many to continue creating innovative solutions that improve people’s financial lives. I encourage you to join us.

*The panel discussion can be viewed online at: http://www.bai.org/RETAILDELIVERY/summits-and-sessions/ceo-panel-live-webcast.aspx