In the latest episode of The Bright Founders Talk, hosted by Temy, we had the pleasure of having conversation with Eric Youngstrom, Founder and CEO of Onramp Funds, Inc. Eric shared his inspiring journey, detailing the inception and growth of his company.
Onramp Funds provides a vital working capital platform specifically designed for e-commerce merchants, ensuring they can sustain and scale their businesses. Drawing from his previous experience launching ShippingEasy, Eric identified a critical gap in the market for accessible financing solutions tailored to the unique needs of online sellers.
Through Onramp Funds, Eric addresses the common issue of merchants running out of money despite having good orders. He discussed how his platform connects with sales channels like Amazon and Shopify, offering real-time insights and tailored financial support. Eric's dedication to empowering e-commerce entrepreneurs is evident in his mission to provide seamless, efficient access to the funds they need to thrive.
From Shipping Labels to Capital Lifelines: Eric's Journey with Onramp Funds
When Eric Youngstrom launched ShippingEasy back in 2012, he revolutionized the way online merchants managed their orders and shipping. What seemed obvious today was groundbreaking back then—merchants could see all their orders from various platforms in one place. But as Eric worked closely with these businesses, he noticed a recurring issue that was more pressing than logistics: working capital. "Merchants had good orders coming in but couldn't even afford the shipping labels," Eric recalls, highlighting the frustrating cycle where cash flow bottlenecks stifled growth.
Seeing this persistent problem inspired Eric to create Onramp Funds, a solution tailor-made for e-commerce merchants facing similar cash flow challenges. After ShippingEasy was acquired by Stamps.com, Eric channeled his insights into building a platform that provides timely and accessible financing. By leveraging real-time data from sales channels like Amazon and Shopify, Onramp Funds ensures that merchants never run out of the capital needed to fulfill their orders. "Any business needs working capital; it's what keeps the wheels turning," Eric says, emphasizing the critical role his platform plays in helping businesses thrive.
Today, Onramp Funds stands as a lifeline for e-commerce entrepreneurs. With its seamless integration and nightly re-underwriting, the platform offers merchants instant access to the funds they need, precisely when they need them. Whether it's preparing for the holiday rush or scaling up to meet increasing demand, Eric's creation is designed to keep the momentum going for online sellers. As he puts it, "We re-underwrite the merchant every night, so the offer is always ready," showcasing the dynamic and responsive nature of Onramp Funds in supporting business growth.
Why Onramp Funds is a Game-Changer for E-commerce Merchants
When asked about the reception of Onramp Funds' unique financing model, Eric couldn't hide his enthusiasm. “We’ve been thrilled with the response from merchants,” he says. Unlike traditional banks, Onramp Funds offers a dynamic solution that evolves with market shifts and merchant needs. Eric points out that many businesses shy away from debt, yet they frequently rely on credit cards. Onramp Funds bridges this gap, providing a seamless extension to traditional credit without the typical pitfalls. By syncing with sales data and offering real-time financial support, Onramp Funds ensures businesses can stay afloat and grow without the stress of cash flow issues.
For businesses curious about how to get started, Eric explains that the process is designed to be straightforward and hassle-free. “We try to make it incredibly easy,” he emphasizes. The initial step involves connecting online stores, which allows Onramp Funds to analyze sales history and project future growth. Within minutes, merchants receive a pre-qualified offer based on their sales data. This transparency means that if the offer isn’t suitable, they can save time and effort. If the preliminary offer looks promising, the next steps involve connecting a bank account and providing basic business documentation, all aimed at making the funding process as smooth as possible.
Eric also highlights the flexibility and proactive nature of Onramp Funds. Merchants not yet meeting the minimum sales threshold are monitored, and they’re alerted as soon as they become eligible for funding. For those already eligible but managing multiple funding sources, Onramp Funds keeps track of their financial landscape and alerts them when it’s advantageous to switch or add Onramp’s services. “We want to offload the work from the merchant and do it on their behalf,” Eric explains. The goal is clear: to enable business owners to focus on growth and sustainability, whether they dream of building a billion-dollar empire or simply maintaining a steady, profitable operation.
From Struggles to Success: How Onramp Funds Transforms E-commerce Growth
When asked if Onramp Funds is making a real difference for its customers, Eric beams with pride. "We've seen customers grow up to 75% in their first 180 days with us," he shares, underscoring the impact of providing accessible working capital. The success stories are numerous, with some merchants even tripling their sales in under two years. It's clear that Onramp Funds is more than just a lender; it's a catalyst for growth. Many e-commerce entrepreneurs, who lack access to venture capital or wealthy backers, find a lifeline in Eric's innovative approach.
We've seen customers grow up to 75% in their first 180 days with us
Eric YoungstromFounder and CEO at Onramp Funds, Inc.
Eric explains that traditional funding avenues often fall short for online merchants. Business credit card offers are typically tied to personal credit limits, which can shrink if an entrepreneur leaves a full-time job to focus on their business. Onramp Funds takes a different route, evaluating the business's real-time sales performance to determine funding needs. This method provides a more accurate and dynamic view of a merchant's financial health, enabling them to secure the capital required to keep their operations running smoothly. "We build a pretty good crystal ball view into the next 90 days of sales," Eric says, highlighting the predictive power of their system.
The result is a significant reduction in cash flow issues, allowing merchants to scale their businesses effectively. As their sales grow, so does their line of credit with Onramp Funds, ensuring they can meet increasing demand. This cycle of growth and reinvestment helps merchants establish a stable revenue baseline, month after month. "It allows you to reach a point where you can actually start to distribute your profits back to yourself," Eric notes, emphasizing the broader goal of not just building a successful business but also creating a fulfilling life for entrepreneurs and their families.
Onramp Funds and the AI Revolution: How Eric Youngstrom Stays Ahead
Discussing the future, Eric dives into how Onramp Funds is embracing AI to stay relevant in a fast-paced industry. "We're already a machine learning-based risk scoring environment," Eric explains. This isn't just about keeping up; it's about leading the charge. By leveraging AI, Onramp Funds can process and analyze vast amounts of data rapidly, providing real-time insights that are crucial for making informed decisions. However, Eric emphasizes the importance of transparency in AI: "We build both AI and ML tools but require them to explain their decisions," ensuring human oversight and accountability.
We're already a machine learning-based risk scoring environment
Eric YoungstromFounder and CEO at Onramp Funds, Inc.
As Eric elaborates, it's clear that AI's role in Onramp Funds goes beyond risk assessment. The technology helps validate and review merchants' websites swiftly, identifying potential legal issues and ensuring compliance. This rapid validation process means fewer delays and more efficient operations, allowing merchants to focus on growth rather than administrative hurdles. Additionally, AI assists in customer service, automating responses to common inquiries and streamlining loan servicing. This integration of AI across multiple facets of the business showcases Onramp Funds' commitment to innovation and efficiency.
Behind the scenes, Eric credits his exceptional team for the seamless implementation of these advanced technologies. "I work alongside a fantastic team," he says, highlighting the strong camaraderie and expertise that drives Onramp Funds forward. Many team members have been with Eric since the early days of ShippingEasy, bringing a wealth of experience and a shared vision for the future. Their collaborative efforts ensure that the software evolves continuously, meeting the ever-changing needs of e-commerce merchants and maintaining Onramp Funds' position at the forefront of the industry.
