How Vero Technologies is Helping Banks and Credit Unions Offer a Diversified Set of Commercial Credit Products to the SMBs in their Communities

While we may not know exactly how fintech will impact our future, we have an idea as to who will be leading the charge. In the next installments of our ongoing series of blog posts, “The New Faces of FinTech”, we will spotlight some of the emerging leaders in the fintech world to get their thoughts on what the future of the industry will look like. Their origin stories are different, their paths to entrepreneurship are unique, but their impacts on their respective industries are significant. No one truly knows what the future of fintech holds, but these industry leaders may have an inkling as to what we can expect. All will be presenting at FinTech Sandbox Demo Day 2022 in April.

Up next is John Mizzi, CEO at Vero Technologies. Vero has developed an end-to-end commercial lending platform that supports underwriting, funding, risk and portfolio management, coupled with a servicing operation, so banks and credit unions can offer new credit products without adding headcount or investing in new systems.

John, tell us a bit about your company? What’s the problem you’re solving?

John: Vero’s goal is to help regional and community banks offer new commercial credit products without having to invest in new systems and additional headcount. SMEs do not have access to the specialized credit products they need through their preferred banking channels. Vero set out to work with these smaller financial institutions to deliver the credit products the businesses in their communities need, without investing in additional headcount or new systems.

Can you describe what it’s been like to be part of the FinTech Sandbox community?

John: As part of Fintech Sandbox, we were able to quickly zero in on a credit bureau to work with (Equifax), as well as, partner with Plaid which informs our underwriting and risk monitoring functions.

In the early days, we had a lot of ideas around other alternative data providers that we thought could be solutions for our needs. Fintech Sandbox made it easy for us to figure out what not to do and who was not a good fit — which was critical as we were trying to move fast. Sometimes figuring out what not to do is even more important than finding the right solution to a problem.

What’s the origin story behind your company?

John: I had been working in the fintech space for the last few years, incubating new products for a larger software development company. I gained exposure to the inventory finance space via a client engagement in my prior role.

Isaac Zafarani, my cofounder, and I connected through an early-stage venture firm called Antler. Isaac had been working in the mobility space, specifically developing software to improve the GPS for autonomous vehicles and had a successful exit.

We began exploring supply chain finance and found that many dealers of manufactured goods had limited access to capital to finance their inventory, particularly from their preferred finance services provider, the banks where they did their traditional business banking. We understood that given the operational requirements of supporting an inventory finance program, there were significant barriers to entry for banks to be able to provide this critical product to the SMBs in their communities.

What milestones has your company achieved so far?

John: We’ve funded more than $15M in wholesale purchases on behalf of the dealers we are working with today.

Additionally, we’ve built the only tri-party system where suppliers, dealers and lenders can all coordinate financing activities on a single platform.

How has COVID-19 impacted your business?

John: We launched in the auto-vertical, given its scale and the familiarity auto dealers have with inventory financing. Covid has drastically affected the availability of new and used vehicles, with supply chain issues limiting new vehicle production and used vehicle values skyrocketing.

These dealers are reliant on inventory financing to keep cars in their showrooms and customers coming through their doors, so it has been advantageous in that way. On the other hand, given limited vehicle supply, inventory levels are at all-time lows.

What’s next for Vero Technologies?

John: We’ve been very focused on creating a differentiated borrower experience. As we continue to get more banks onto the platform, we’ll refocus on helping the dealers run more efficient digital retailing operations. More profitable dealers means lower credit risk for our bank partners.