Let’s say you’re in a situation where you have a contractor in your living room, he’s proposing a $10,000 job for home-improvement.
It’s something you need to do, but you don’t know how you are going to pay for it. Then he offers a way to finance it in an affordable way. The way he does it is by scanning your driver’s license barcode on the back. Not even a minute later, there’s a loan waiting for you, it’s not just pre-approved but genuinely approved. This means no payments and no interest for the initial year. In the end, you sign his contract.
This is the strategy that the business GreenSky Credit incorporates, investor Sahm Adrangi notes. This $3.6 billion firm allows dealers to finish trades by coupling buyers with creditors at the times of transaction. This business from Atlanta just came out of the blue and is now ranked third in the U.S. by appraisal. That’s out of all financial technology firms which are privately owned and funded by venture financiers. Sahm Adrangi highlighted that the placement is in accordance to CB Insights, an index which also placed SoFi and Stripe in front of GreenSky LLC on its rank of “fintech unicorns.”
The person who owns the lion’s share of GreenSky Credit, David Zalik, has been on the media’s radar. He relocated to Alabama from Israel with his family at four years old. He ended up skipping high school and then started at Auburn University at 14 years of age. Soon after, he dropped out to concentrate on a computer-assemblage business which he created himself. Evading the public eye is starting to be more difficult for Zalik. In September, Fifth Third Bancorp declared a union with GreenSky Credit and also purchased a $50 million share which denotes an overall price of $3.6 billion for Zalik’s business which is a big win for investors like Sahm Adrangi.
What’s the method that they use? GreenSky Credit doesn’t simply generate loans. Rather, it enlists dealers who market high-ticket merchandise like home improvement projects such as window installations, different types of siding, or kitchen remodeling. Sahm Adrangi said that it then finds the right set of banks who are willing and able to give loans to approved buyers with the merchant. GreenSky doesn’t do business with overextended recipients. Zalik mentioned the majority of its clients withdraw loans for ease of use instead of necessity.