Finnovate was launched last month with the aim of capturing 5% of Australia’s $36.7 billion business finance market within its first five years, with a longer-term goal of 10%.
Founded by Chris Beath, Finnovate claims to be Australia’s first business finance comparison website, backed by Beath’s Brisbane-based asset finance group, A Class Business Finance.
Finnovate allows businesses to access and compare the rates and fees of major lenders, and apply for equipment and vehicle finance and leasing online.
“There has been a longstanding lack of legitimate competitive pressure in the SME loan segment… and borrowing insight has suffered because of this,” Beath says.
“Finnovate totally changes the game – until now there has been nothing like this in the business sector.”
Beath talks to StartupSmart about why comparison sites are soaring in popularity, and how his site stands out from the pack.
What prompted you to launch Finnovate? What niche did you identify?
Finnovate was launched following a relentless inquiry to find the best possible way for businesses to access, compare and apply for their business finance needs.
We identified that the equipment finance industry in Australia had remained relatively unchanged for more than three decades and was in need of some serious innovation.
We did our homework over a two-and-a-half year period and designed something that not only met the needs but exceeded the needs of what our customers were looking for.
How did you fund the business? What were your start-up costs?
Finnovate is backed by A Class Business Finance Propriety Limited and was self-funded. Start-up costs were in the vicinity of $750,000.
How do you promote the business?
Finnovate is being promoted through a number of channels.
We have great strategies and, more importantly, great people around all of our promotional activities including public relations, advertising, direct marketing, social media, and through our internal sales team.
How do you stand out in the market? What’s your point/s of difference?
That’s easy – we’re the only company that is actively fighting for business to lower the cost of borrowing.
There is a huge number of comparison websites for consumers – we’re the only one on business’ side.
Finnovate also stands out in the market by being the first and only comparison site for equipment finance. Not to mention that we’ve introduced transparency and real empowerment to Australian business.
Furthermore, Finnovate is the only place to obtain interest rates for equipment finance online.
What are your revenue projections for 2012/13?
Revenue projections for this financial year are $36 million.
Comparison sites are becoming an increasingly hot category. Why is this?
Comparison sites have certainly rocketed in popularity.
Why? Because they’re a great way to force down the price of various goods and services, and they make it easier than ever for the customer to get the best price.
Comparison sites have transformed the way we shop for a number of goods and services, and make the market more competitive.
Where do you think the market is heading?
We see the comparison site market continuing to gain momentum in the coming years with new and innovative ideas developing.
This space has been increasing in popularity across Europe, the US and more recently in Asia – and it makes sense that Australia is following a similar path.
Australian consumers and businesses alike expect the best – and comparison sites are a great way to deliver on this expectation.
What’s the biggest risk you face?
To some degree, Finnovate’s rapid rate of growth posed a risk as our expectations and forecasts were well surpassed from an early stage.
Fortunately, we’ve been able to mitigate this risk by ensuring we’ve got a really impressive team. Finnovate has a fantastic culture and has attracted the best of the best.
Combining the very best people while staying true to our vision and our values, we’ll make sure that our strong growth is actually one of our strengths.
Is there anything you would have done differently?
Finnovate’s journey to date has been enormously exciting and fulfilling. It certainly hasn’t been without challenges and we’ve learnt a lot of lessons along the way.
But in saying that, we’re all the better for the experience. So would we have done anything differently? Not at all.
What advice would you give to other online entrepreneurs?
Read Good to Great and Great by Choice – both by Jim Collins. While not specific for the online market, these two books are must-reads for any entrepreneur.
This, and never forget to enjoy the ride.