On Deck Raises $42 Million to Provide Online Loans to Local Businesses
On Deck has raised $42 million in a fourth round of capital to provide local merchants with loans over the Internet.
Institutional Venture Partners led the round, with existing investors RRE Ventures, SAP Ventures and First Round Capital also participating.
To date, the New York-based company has raised $75 million in equity, and even more if you count the $100 million in debt it secured from Goldman Sachs and Fortress Credit in August.
On Deck said it will use the capital raised today to fund additional growth, which includes new product development and getting the word out to more merchants about the company.
On Deck lends between $5,000 and $150,000 in short-term loans to small businesses, ranging from auto repair shops to bridal boutiques. It vows that the loan application process can take as little as 15 minutes because it uses technology on the back end to evaluate a company beyond its credit scores.
Other lenders provide loans online, but most are targeting other online entities. For instance, some of the companies that have entered that space include Kabbage, which has raised $56 million in capital, and more recently, Amazon.com.
Since 2008, On Deck says, it has deployed $400 million to thousands of small-to-medium-sized businesses.