Marketplace Lenders Sharing the Love with Small Businesses This Valentine’s Day

By, Brock Blake CrowdFund Beat  guestcontributor,

Cupid has a big effect on how Americans spend their money, and when hit with his arrow, the average American spends $134 on Valentine’s Day gifts and $54 more than usual for a romantic meal with their partner. The week of February 14 sees huge increases in total volume and average purchase amount, and savvy local businesses in these industries can win big with the right preparation.

“The week of Valentine’s Day we see about a 750 percent increase in revenue. The best advice I have for other florists is just lots of planning ahead,” says the owner of Foxglove Flower and Gifts.


However, small businesses often have difficulty getting timely loans from big banks and even community banks, who struggle to accommodate the increase in demand. Additionally, banks typically only want to give out bigger, longer-term loans, which is most profitable for them. As a result, traditional lenders are increasingly denying businesses the smaller, short-term loans needed for a one-time capital injection ahead of a major holiday. According to the Federal Reserve Bank of Cleveland, non-farm business loans of less than $1 million—a common proxy for small business lending—have declined steadily from 1998-2012, dropping from 51 percent to 29 percent in that time frame. This makes planning ahead and acquiring credit difficult for small businesses when they need to boost their inventory a few months before Valentine’s Day.

“We start preparing in early January by getting our Valentine’s-specific product out on shelves so people who come in for other things will know what specialty items we have and will be more likely to think of us when deciding on a gift,” says the owner of V Chocolates.

This lack of bank loans for smaller businesses, while not necessarily new, has led to the rising popularity of both crowdfunding and peer-to-peer (a.k.a. marketplace) lending, which have grown into multi-billion dollar industries. During the recession, the “credit crunch” not only affected the consumer market, but the small business and startup segments as well, opening the door for alternative financing to support job creation and offer cost-effective credit options for these establishments.

Valentine’s Day can mean big business for small businesses who prepare for it. From inventory to hiring, the right preparations can pay big dividends. Like any big return, it takes foresight and investment. Showing love to local businesses by shopping at their stores doesn’t just mean revenue for independent small companies, it means more jobs and improved local economies. We wish all our fellow small businesses success during this Valentine’s Day season.


Brock Blake is the founder and CEO of Lendio, a marketplace lending platform that connects small businesses with over 50 best-in-class small business lenders in the country. To date, Lendio has helped more than 500,000 small business owners save time and money in search of the right small business loan.


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