Credit Pulse predicted a retail chain would go out of business 3 months before it happened. What else can the company’s holistic business credit scoring system, leveraging proprietary data and AI, do for businesses?
Imagine you’re a manufacturer, shipping goods to a small or medium-sized business on credit terms. If that customer goes bankrupt, there’s a pretty good shot that shipment becomes your problem: bad debt.
This almost happened to Credit Pulse’s first customer, a large global footwear and clothing brand. Credit Pulse’s proprietary risk model helped predict the June bankruptcy of Bob’s / Eastern Mountain Sports, which prevented millions in potential losses.
This practice of delivering goods and services without an immediate exchange of money, called trade credit, is a vital part of the financial system that most people don’t know exists. Credit Pulse has arrived to fill the niche, helping suppliers and manufacturers make better customer credit decisions and small business buyers access credit more easily.
While the 100+ data points they leverage to create that holistic business credit score can apply to any industry, Credit Pulse is initially focusing on business-to-business physical good industries that have a large ‘credit risk differential’ between suppliers and their buyers. They’ve seen the most pain with industrial manufacturers that sell to the trades (construction, roofing, solar installers, plumbers, etc.) and in the footwear and clothing manufacturers that sell to retailers.
“We’re working with leading manufacturing companies, finding new ways to assess private businesses, that typically keep their data private,” said Jordan Esbin, Credit Pulse founder and proud Purdue alumni. “For too long, bad data on private businesses has directly translated into bad debt for manufacturers and the $9T business-to-business trade finance market. We leverage proprietary and vertical-specific data to predict the health of these businesses and their payment behavior. We are deploying advanced analytics-driven credit models on top of payment, hiring, online sentiment, adverse media, and other private financial data.”
Credit Pulse’s capacity to automatically and easily flag early risk of future tumult makes it easy to see why investors are keen to become early supporters.
Credit Pulse has just closed their seed round, led by Amplo, with support of Purdue Strategic Ventures. “We’re excited to partner with Purdue and the broader Purdue network,” said Esbin. “With this funding, we plan to grow our incredible team to accelerate our product value and support our corporate customers.”
Danielle Salters, principal at Purdue Strategic Ventures who led the investment process and executed investment, explained why the team felt strongly about the company. “Credit Pulse is bringing automation and AI to an antiquated space, sourcing, aggregating and analyzing data in real-time to enable customers to make predictive credit decisions, reducing bad debt and streamlining credit decisions. This is meaningful to enterprise clients and with the potential to impact the viability of small-to-medium sized business. We are excited to support Jordan to diversify our portfolio into fintech and to aid in the commercialization of this innovative and impactful technology.”
To learn more about Credit Pulse and see their open positions, visit their LinkedIn page.
Media Contact: Polly Barks, phbarks@prf.org
Source: Jordan Esbin
