YouLend: Embedded Finance Is Just Getting Started

Today, embedded finance is emerging as a pivotal trend, reshaping how businesses access financial services. 

Jakob Pethick, CCO of YouLend, an embedded finance provider operating in the US, UK and Europe, offers insights into this burgeoning sector and its potential to transform small business financing.

Solving financial problems for customers 

“Increasingly, tech companies are beginning to solve financial problems for their customers,” Jakob observes. “We see this a lot in the e-commerce space, in the travel space, food delivery payments. This embedded finance wave is just getting started.”

The core of this trend, according to Jakob, is the integration of banking and financial services into software and tech platforms. This approach serves two primary purposes: addressing the financial needs of small businesses and helping tech companies enhance customer loyalty and monetisation.

“For small business customers, there's usually a challenge around not being able to access financial services that help them grow and create jobs,” he explains. “For a lot of tech companies, there are challenges around keeping their customer base loyal to them, helping them grow and monetising them further.”

Collaborating with JPMorgan

YouLend's recent collaboration with JP Morgan exemplifies the growing interest in embedded finance from traditional financial institutions. “The nice thing about the JP Morgan deal is that it brings additional firepower to us,” Jakob says. “It allows us to fund more small businesses, both in the UK and the Eurozone, and really that allows us to help more job creation and more GDP growth.”

Partnerships are crucial to YouLend's business model, with the company relying entirely on these relationships for market access. 

One notable partnership is with Amazon, where YouLend's financing options are integrated directly into the Seller Central platform. “When sellers log in, they'll be able to see offers that are pre-approved,” Jakob notes. 

“It's been a pleasure working with the team at Amazon. They know financing really well, so it's really good working with the partners there.”

A consistent focus

Despite the rapid changes in the fintech sector, Jakob maintains that YouLend's focus for the next 12 to 18 months will remain consistent. “Our answer is usually really boring” he admits. “We're going to keep doing what we are doing now because we are only just getting started.”

This strategy involves continual product innovation and optimisation rather than chasing new trends. “We see a lot of demand from small businesses across many verticals in the UK, EU, and US, and we see a lot of demand from partners as well in new verticals,” Jakob explains.

The company's mission to help small businesses access financing for growth and job creation underpins this approach. Jakob emphasises the importance of refining existing products and processes: “We don't think there's a lot of need to do new things except innovate on the product. Make sure that it's easy to bring to market, approve as many as you can and bring prices down."

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