Interview with Damian Brychcy, COO of Capital On Tap: Unlocking the Secrets of Small Business Finance in a Changing Landscape.

We had the pleasure of speaking with Damian Brychcy, COO of Capital On Tap, who detailed the company’s approach to small business finance. Damian explains how the lending needs of small businesses have evolved over the last decade, from the technology trends driving the evolution of small business lending to the effects of the current climate.

Capital On Tap’s mission is to streamline the process for small businesses to get access to funds and manage their finances. The idea is a simple one: helping people who need access to working capital but have been ignored by banks, who are concentrating on larger companies. Capital On Tap is seizing this opportunity by providing products that make the lives of the many small business owners in the US and the UK easier and more financially rewarding. By developing tailored technologies, they are able to deliver seamless solutions that make managing finances secure, fast and efficient.

This means that, with Capital On Tap, small businesses can take advantage of simple tools and services to help them do more with less, so they can focus all their energy on what matters most: growing their business, exploring new opportunities and achieving success. To date, Capital On Tap has given over $5 billion in funding to more than 200,000 small businesses. With its customer base growing rapidly, we wanted to learn more about how they stay ahead of the curve.

In this Interview, we uncover Damian’s insights on the changing small business lending landscape, and gain his words of advice to help small business owners come out on top during tough economic times.

Table of contents

1. How the lending needs of small businesses have evolved over the last decade
2. The core benefits for small business owners using a commercial credit card in the current climate
3. How businesses are operating differently since the pandemic
4. Why Capital On Tap has been so successful in delivering its growth strategy over the last five years
5. The key technology trends driving the evolution of small business lending
6. Financial advice for any new small business owner

1. How have you seen the lending needs of small businesses evolve over the last decade?

“I think the biggest change I’ve seen in the last decade with small business owners is that they feel empowered to make their own decisions. They don’t want to go to a bank, and they don’t want to talk to an account manager. They want to do their own research and pick a credit card or business bank account that works for them and their business. They want a fast and digital experience because that’s what they’re used to as consumers in their personal lives – and they want that same experience as a business owner.”

2. What are the core benefits for small business owners using a commercial credit card in the current climate?

“There are two key benefits to using a commercial credit card for small business owners. The first one is that it lets them separate their business and personal spend, especially when things are tougher from an economic perspective. It’s really important that the business has its very separate finances from the owner’s personal finances. The second key benefit is that a corporate credit card gives you more tools to run your business. This includes things like cards for your employees, the ability to give your accountant a login, and having all of your transactions feed into your accounting software. It’s essentially built for making it easier and faster to run a small business – most personal cards just aren’t built for that.”

“Commercial credit cards are essentially built for making it easier and faster to run a small business – most personal cards just aren’t built for that.”

3. Have you seen any trends in how businesses operate differently since the pandemic?

“The biggest change I’ve seen since the pandemic is that when I talk to our small business customers, they have more contingency plans in place for whatever shit might hit the fan. Be it employees being tougher to hire, supply chain issues, fewer customers, or rising prices for the goods they use for their products – they just seem to take it more in stride because they survived the pandemic. I think that this kind of confidence is so important for a business owner. If you’ve ever run a small business or been an entrepreneur, you know how hard it is every day, and you understand the struggle that business owners face. So, I think being ready to execute those plans at the drop of a hat is a superpower.”

“Our small business customers have more contingency plans in place since the pandemic. I think being ready to execute those plans at the drop of a hat is a superpower.”

4. Why do you think Capital On Tap has been so successful in delivering its growth strategy over the last five years?

“The key reason we’ve been successful is our focus. We’ve thought about one thing and only one thing for five years, which is “How do we make the lives of small business owners easier?”. If you think about a bank, you might have consumer products, business products, corporate products, lending, banking, payments… Everything and anything under the sun. And it’s very hard to be very good at one thing for any customer segment. Focusing exclusively on micro and small businesses in the US and the UK and targeting the small business owner’s finance needs has allowed us to continue to grow, improve our offering and find an increasing number of small businesses that can use our product.”

5. What are the key technology trends driving the evolution of small business lending?

“The main technology trend driving small business lending is open banking. This gives small business owners the ability to connect their business bank accounts directly with any lender. That can be used both upfront for the first time they’re applying for something, and for something that’s ongoing. The biggest difference that this makes is that it provides the business lender with a real-time view of a business – not a historic view of a business. It gives them the ability to do ongoing monitoring in a seamless, up-to-date and correct way. And I think that if you take those two things of real-time and monitoring, you can see a lot more risk on the part of lenders. When they see, oh, this customer isn’t someone we would’ve traditionally worked with, but now that we have all this new data and all this extra monitoring ability to see what’s actually going on in their business bank account, we feel much more comfortable offering them a credit card or a loan.”

“The main technology trend driving small business lending is open banking. The biggest difference it makes is that it provides the business lender with a real-time view of a business – not a historic view of a business.”

6. What’s the one piece of financial advice you would give any small business owner?

“The single piece of financial advice I’d give to any small business owner is to be prepared before the economy goes south. I think the number one thing you can do is have access to one or two lines of credit that stay open. You don’t have to use them, but if you had to, they are there and ready. The worst thing to do is to wait and start looking when things get bad. I think business owners are doing more and more of this. Like I mentioned, they’re more prepared for contingencies than they ever have been, and I think that’s the most prudent piece of financial advice I could give them.”