Data to the Rescue: How AI is Cracking Open Small Business Finance

Small businesses are often overlooked when it comes to getting finance. Despite employing the majority of people globally, they face impossible hurdles when they need money to cover cashflow or expansion.

The reason is simple: data. If you only measure the data points available via a traditional lending process, you miss what’s special about each small business, and dismiss them too quickly. Small businesses are unfairly seen as unprofessional, and not standardised enough to accurately risk assess – unless you know exactly where to look in the data.

The rise of easy-to-integrate, powerful AI tools means that data is quickly becoming the only differentiator of note when it comes to tech platforms. More data, more accurate data, data that’s easier to access, and a deeper understanding of this data is what matters.

The Liberis platform can leverage AI to lend sustainably to more small businesses than any other finance platform. How?

For 16 years, we’ve financed small businesses and meticulously tracked their performance data. Working with our partners, we collect daily, anonymous information about their businesses. This data includes cases where businesses succeeded despite lacking the usual factors that attract traditional lenders. By capturing and analysing these outliers, we’ve built a wealth of knowledge about what truly makes small businesses thrive.

We partner with payments, food delivery, salon management software, and more, reaching a diverse variety of small businesses. Each partner offers unique insights into specific industries and which data points indicate high performance. We’ve learned to incorporate this custom data and build a flexible platform to take in the data points that our partners know make a difference when spotting brilliant small businesses. We use this diverse data to deeply train our AI, incorporating everything from occupancy rates to food hygiene ratings and customer reviews. Every piece helps us discover hidden gems among small businesses.

When all else fails, there’s no substitute for a quick call with somebody who knows how your business works. While we are confident enough in our data that we can make the majority of our decisions in established markets automatically, without human input – our small business facing teams are on the phone every day to talk to everybody else. We live and breathe small businesses, so we know how to spot diamonds. Crucially, each of these conversations feeds directly back into our data and makes it more likely that we can automatically spot the next brilliant small business who applies.

These three strengths mean our platform is better able to deploy AI to sustainably fund small businesses than any other and is improving every single day.