Home improvement is way, way up. Amid pandemic-prompted stay-at-home orders, people are getting sick of looking at the same old backsplash and dream of transforming their basements into second living rooms.
The trend has been a boon for PowerPay: The King of Prussia fintech company, which manages a digital lending platform for home improvement financing, has seen tremendous growth in the past few months.
PowerPay helps consumers access lending through a national network of 5,000 contractors. COO and cofounder David Haas said a 600% growth in business has led the company to rapid expansion. Before the pandemic, PowerPay had 10 employees; it now has 110.
The company was founded in 2017 and officially launched in December 2019 after designing its software and structuring its team. At launch, Haas said, PowerPay only projected to do approximately $200 million in loans. But as 2020 nears its end, the company has secured $1 billion in loans. Loans range from $15,000 to $100,000 per customer with no penalties for prepayment.
Haas and his company found a niche earlier this year once the credit and banking markets shifted to reflect the recession and pandemic. An influx of people sought ways to finance home improvement projects and needed another way to do it.
“The credit markets and banking markets tightened up,” he said. “Since our model was designed in a unique way where partners and bankers weren’t affected by pandemic, we were one of the few companies left for funding.”
In order to meet a rising demand, PowerPay invested in technology to better facilitate loan volume and speed to consumer. Underwriting and information verification was also prioritized to ensure protection against fraud. Hiring local talent from the Philadelphia area mattered, too.
Haas said that having a service that can help consumers vet potential contractors is an advantage during a pandemic and its compression of time and decision making. With more people relegated to their homes, he’s noticed that many people are noticing cosmetic changes they could make like kitchen remodeling or leisure additions.
For one, Haas has noticed a significant increase in consumer requests for pools, as public pools across America faced limited access due to COVID-19 during the summer. PowerPay is currently one of the largest pool finance companies in the country, he said.
As discussions continue about a COVID-19 vaccine and people continue to navigate the pandemic, Haas believes that helping people finance improvements to their home as easily as possible has an added significance.
“We think that at the end of the day, we feel like we’re doing something good for people,” he said. “It’s all about giving the consumer the fair deal. We feel like we’re helping people during the pandemic to get things they need and want.”
PowerPay is hiring for a handful of roles right now, including a Ruby on Rails developer and regional account manager.
Michael Butler is a 2020-2021 corps member for Report for America, an initiative of The Groundtruth Project that pairs young journalists with local newsrooms. This position is supported by the Lenfest Institute for Journalism.
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