Buoyed by $8 million in seed funding, Yanir Yakutiel launched a fintech start-up in November, last year, to assist small businesses under-serviced by banks and other traditional lenders. The former finance and shipping expert spoke to Dynamic Business about Sail, including the process of raising capital and its participation in the Tel Aviv Landing Pad program established by Austrade in collaboration with the NSW government.
Dynamic Business: What service does Sail provide small businesses?
Yakutiel: We are an online small business lender targeting the ‘S’ in the SME. We provide term loans, ranging between $5,000 and $100,000, and can provide funding within 24 hours. This means small businesses finally have fast access to finance, allowing them to better manage their cashflow, expand, hire staff, purchase equipment or stock and much more.
We want to revolutionise the customer experience for business owners applying for a business loan. We do this by leveraging big data in real-time to provide a simple, secure and responsible lending solutions to Australian business owners.
Dynamic Business: What distinguishes Sail from other lenders?
Yakutiel There’s definitely a lot of activity in the fintech space in general and alternative lending in particular at the moment. I believe most of the alternative lenders in Australia are lending companies before they were technology companies. What sets Sail apart is that we are a technology company first and foremost. We’ve invested heavily in our user product, back end systems, loan management, core banking software and security features. Our proprietary algorithm uses machine learning to deliver better risk analysis and our security software, which is similar to airport-grade ID security, enables customers to upload personal documents safely.
Our technological infrastructure gives us a competitive advantage in terms of scaling. Other lenders have done a phenomenal job, but if were looking at core technology, we are at the forefront in the Australian market.
Dynamic Business: What led you to start the company?
Yakutiel: I’ve been lucky enough to have gained extensive exposure within financial services firms in many corners of the world, including 15 years in investments, financing, mergers and acquisitions, debt raising, joint ventures, and valuations. I also launched, managed and developed successful global businesses across different countries before launching Sail.
I started Sail in January 2016, after repeatedly seeing small businesses being squeezed out of credit markets. Small businesses in Australia are particularly under-serviced by the big banks. With the advent of new technology, specifically financial technology, I saw the opportunity to create a technology-based solution to meet the unique funding needs of small business owners.
Dynamic Business: Who is Sail backed by and how did you secure support?
Yakutiel: Sail is backed by prominent Sydney-based investors and brothers Marc and Gideon Lubotzky, who’ve joined our board of directors. The key to raising capital was inspiring potential investors and leaving them confident that we could execute the business plan. It is very easy to make a beautiful presentation, but investors want to see someone with faith in their convictions and who is completely determined and focused on executing a well-designed plan. It was also necessary to assemble the right team that reflects a balance of skills, personalities and talents, so as to nail the product and user experience. I’ve been very lucky to have built a strong team.
Dynamic Business: What went into qualifying for the Tel Aviv Landing Pad program?
Yakutiel: Simply put, we met the criteria outlined by Austrade and the NSW Department of Industry. We were asked to outline our vision for the business, scalability, proof of concept and existing funding, along with differentiation factors, our value proposition and market relevance. The eight participating fintech and cybersecurity startups were selected by a joint panel but I think we did a good job at demonstrating our understanding of the market and our customer value proposition.
Dynamic Business: What opportunities did the 10-day intensive program provide?
Yakutiel: The program was an excellent opportunity for Sail and the other start-ups to learn from Israel’s innovation ecosystem. It gave us access to world-class thought leaders in tech startups, VC investors, legal practitioners, CEOs & founders, accelerator programs, networking opportunities and access to the world’s biggest tech innovation festival, the DLD Summit.
Dynamic Business: What key insights did you return to Australia with?
Yakutiel: It really gave us the opportunity to recalibrate our trajectory of what we’re trying to achieve at Sail. We were able to take a step back, listen to the experts in the industry and better understand the hurdles they overcame, how they managed to scale their business and the areas in which they fell short. The experience allowed us to foresee issues in our own business plan we would otherwise not have realised. We came back to Sydney with a refreshed outlook on where we’re heading and an expanded network and resources to support us through the start-up journey.
Dynamic Business: Does Tel Aviv’s start-up community differ to Australia’s?
There’s definitely a more established start-up community in Tel Aviv. People are very comfortable working for early-stage companies in Israel, whereas people in Australia are geared towards graduating university and going into a stable job with an established business. Israelis have a high tolerance to risk, along with a mindset where it is okay to question the status quo, and it’s okay to fail. It’s great to see Australia investing in its own start-up ecosystem but there is a long way to go until we reach the heights of Silicon Valley, Tel Aviv & Shanghai. There is always room for the ecosystem to grow, however, and all it might take is a few more homegrown successes.