Flowcast’s Tillful Aims to ‘Democratize’ Small Business Credit Scoring

Flowcast, a Silicon Valley fintech that builds AI-based automated credit risk models for lenders, announced a new business credit-scoring product today called Tillful. Flowcast founder and CEO Ken So told us in an interview this week that the new product is aimed at “democratizing” the credit scoring process for small businesses. And he believes his new AI-driven methodology will help expand the available market of “fundable” small businesses for lenders.

Ken argues the current credit scoring model for SMBs was due for innovation.

When you apply for business loans or credit cards, lenders will check the credit risk of your business based on past financial behavior,” Ken told us. “However, unlike personal credit scores, many business owners don’t even know that business credit reports exist. That is because reports from existing business credit reporting agencies tend to be expensive and frankly archaic. We wanted to completely change that.”

Specifically, Tillful offers SMBs the following services free of charge:

  • Free credit analysis, updated daily.
  • A unified dashboard of all linked business accounts providing a complete assessment of a company’s financial health.
  • Actionable personalized recommendations to improve a company’s credit profile.
  • Access to qualified financing offers based on Tillful’s free credit analysis.
What’s My Tillful Score?

What’s most intriguing to use about Tillful is that it doesn’t provide easier access to existing business credit scores. Rather it has created a brand new credit score. So instead of “what’s my Equifax score”, Ken wants businesses to ask “What’s my Tillful score?” And unlike with other platforms, the Tilfull score will be free and fast. And Ken argues it’s also a more accurate reflection of the small business owner’s creditworthiness.

“What makes it possible now than say five years ago is the access to technologies that can build robust credit models,” Ken said. “Tillful leverages the company’s advanced machine learning solution that has been trained and validated in partnership with some of the world’s most innovative financial institutions. The result is a completely new credit scoring that is fast and fair.”

As Ken explains, Tillful makes money by generating referral fees from lenders for approved loans. The company also generates licensing fees from lenders for its AI technology.

Expanding the TAM for Lenders

Using AI to make faster and better credit decisions has the potential to unlock as much as $600 billion in capital for SMBs. That’s a potential boon to both lenders and credit-hungry SMBs.

“There is a more than two trillion dollar funding gap [in the SMB space]. About three-quarters of businesses are turned down for loans by banks. Yet one-third of these are fundable,” Ken explains. “If AI can unlock that one-third of the market, that’s a $600 billion opportunity that can be closed. That is a huge opportunity for banks to lend more while maintaining their risk profile.”

Flowcast was founded in 2015. According to Ken, the company completed a Series A round last year and has raised more than $7 million to date.

You can catch our full interview with Ken So here.

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