David Zalik drives up in his black Mercedes convertible towards the parking garage of an aged low-rise office structure near Atlanta and takes off the baseball cap that protected his balding head from sun rays. “This here is a less glamorous variation of Willy Wonka and the Chocolate Factory, nobody goes here,” he informs me as we near the entrance.
With that, we were the first public witnesses to the large, irregularly shaped lower office where GreenSky, the United States third-most-valuable fin-tech business (after SoFi and Stripe), has been resting in obscurity for the last ten years.
It is Zalik who has the golden ticket. The past September, GreenSky obtained $50 million at a $3.6 billion appraisal in funding. The 43-year-old CEO and co-founder still possesses over half of the business, placing him well into the billionaire levels.
His intrigue beings in the hardly lit labyrinth of cubicles, the place where employees with headsets explain GreenSky’s simple-to-use mobile application to home remodeling constructors and contractors.
It is an odd consumer foundation for a fin-tech unicorn, however, Zalik found out that contractors were the gatekeepers of some of the greatest markets in the United States. Yet another number of the company’s phone reps are working to help homeowners catch up on their loans.
Getting money on time generally isn’t an issue, though. While GreenSky has the ability to quickly approve and acquire unsecured loans, it does this solely for borrowers with acceptable FICO scores, allowing a slew of other online loaners to chase the outliers.
However, GreenSky’s real secret is something you cannot witness. A model assigns much of the uncertainty and the work to other entities and returns from both ends of every deal. Those 17,000 contractors don’t just market the deals to homeowners but also pays GreenSky, typically, 6% of the credit amount. It is 14 deposit-rich banking partners such as Regions, SunTrust and Fifth Third (which recently produced the equity investment with Zalik’s business), that are the ones actually making the loans.
“We were inspired to create something where we controlled the transaction,” Zalik mentions.