Today we’d like to introduce you to Vernon Tirey.
Vernon , let’s start with your story. We’d love to hear how you got started and how the journey has been so far.
After 30 years in management consulting and marketing automation, I was looking to take on new challenges. A former client asked me to help him with a turn-around project at Insurance.com, and on that assignment, I fell in love with the marketplace model. With a marketplace, you bring an entire industry to the point of sale and put the customer in charge. The turn-around was successful, and after we sold the business, I started looking for another marketplace opportunity. That’s when I was introduced to equipment financing. I spent the better part of a year researching the industry and assembling a team, before launching LeaseQ in late 2011.
After 30 years in management consulting and marketing automation, I was looking to take on new challenges. A former client asked me to help him with a turn-around project at Insurance.com, and on that assignment, I fell in love with the marketplace model. With a marketplace, you bring an entire industry to the point of sale and put the customer in charge. The turn-around was successful, and after we sold the business, I started looking for another marketplace opportunity. That’s when I was introduced to equipment financing. I spent the better part of a year researching the industry and assembling a team, before launching LeaseQ in late 2011.
Overall, has it been relatively smooth? If not, what were some of the struggles along the way?
LeaseQ has faced two significant challenges:
a. Operating Capital – We understood that marketplaces require lots of capital to get off the ground, but still learned it the hard way. The operating capital required for LeaseQ was more than what we raised in five years. Fintech marketplaces like Lendio and Fundera serving the SMB space raised $35 million and $19 million respectively, compared to our $7 million. In the long run, our discipline and choice to largely self-fund may serve us well, but operating too close to the bone in the short term is a challenge.
b. Innate Industry Complexity – Equipment financing is a large industry sector with over $1 trillion in new originations annually, but it is deceptively complex. Most marketplaces support two-party transactions. That’s a two-node problem with inputs and outputs between a buyer and a seller. But equipment financing is a three-party transaction between a borrower, equipment seller, and lender, and that’s a six-node problem. It is a highly fractured market with 30 different types of equipment (e.g. medical, construction, high-tech, etc.), financed by over 500 specialty lenders (none with more than 4 percent market share), serving all classes of credits (from A++ to D) for over 50 years. Additionally, it is a laggard industry that has been very slow to adopt the technology, and today, most underwriting is done manually.
founder and CEO of LeaseQ – what should we know? What do you guys do best? What sets you apart from the competition?
LeaseQ makes it easy to buy and finance equipment. Like every marketplace, we link all parties at the point of sale and automate transactions. But, unlike other marketplaces, we apply this technology to equipment financing. Prior to LeaseQ, less than 10 of the 500+ equipment finance lenders could generate an instant quote. Today, LeaseQ not only provides instant competitive quotes to borrowers and equipment sellers so they can make an informed buying decision while shopping for equipment, but we also provide instant quotes capabilities to any small ticket equipment lender who is not automated. LeaseQ is now taking the next step and working with major equipment manufacturers, distributors and dealers to fully automate the equipment finance process and provide funding in just one hour.
Do you feel like our city is a good place for businesses like yours? If someone was just starting out, would you recommend them starting out here? If not, what can our city do to improve?
Boston is not known as the epicenter for marketplaces, fintech companies, equipment finance lenders, or investors in those industry sectors. But Boston is ideal for hiring entry-level talent and provides key expertise in next-generation technology, like machine learning and blockchain. Outside of Boston, there are some industry hotspots, like Portsmouth, NH where equipment financing is vibrant and growing. We’re fortunate we don’t need to convince top talent on the West Coast to come to Boston, but can find it right here in New England.
Getting in touch: BostonVoyager is built on recommendations from the community; it’s how we uncover hidden gems, so if you know someone who deserves recognition please let us know here.
