SoFi Originates $27 Million in Small Business Loans in Inaugural Quarter

“I would say the SMB business is at a very nascent stage,” said Anthony Noto, CEO of SoFi during the Q3 earnings call. “It is still a startup business.”

SoFi originated $27M in small business loans in Q3, its first quarter generating business loans internally. It has a lot of room to grow especially considering its $3 billion partnership with Basepoint Capital for this product.

The company says that it will ease into it.

“It has great prospects and one we will invest in over time and will continue to grow,” Noto added. “Now, getting the credit right is important. Building relationships and the unit economics are important. Why? Because these are high repeat customers. Businesses need capital to grow. When they take out a loan, it helps them grow. That gives them motivation and economic incentive to take out another loan and then another loan. Just like the largest corporations in our country, that capital fuels the growth. So we want to make sure we build relationships first and foremost, achieve the right unit economics, and we continue to expand that over and over on a nice linear line. So we are really pleased with where we are, but it is nowhere near where it will be in the future.”

SoFi previously referred all small business loan inquiries to third parties but they have since rethought that approach.