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George: My superpower is the ability to combine the analytical, the data with the human connection and the empathy required to live in a society.
When I met George Cook, the founder and CEO of Honeycomb Credit, about seven years ago, he and I chatted about the social impact of local community investing. I was skeptical. Over the years since I’ve become a true believer. I relished my conversation with him for this episode, focusing on the societal benefits of local investing.
Honeycomb Credit is one of the leading players in regulated investment crowdfunding. The SEC-regulated FINRA-member portal primarily helps small businesses with debt financing. It is quickly approaching $25 million in business financing since its founding.
There are nearly 30 million small businesses in the US. Most of them have capital needs. This is a big potential market for Honeycomb Credit–and for the investors like you who participate in the loans.
George grew up in Appalachia in a family that operated a community bank for 130 years. “I grew up in the family business. I fell in love with relationship lending, working with business owners who are literally sitting across the street from the branches that I was working out of and loved working with us, hearing their stories and playing a small piece in their growth journey.”
He shares his vision for the community impact of the work he does.
This is such an opportunity to do well while you do good.
The diversity of business owners is: We're working with businesses that support disabled entrepreneurs. We have a ton of veteran-owned businesses. More than half of the businesses we work with are owned by BIPOC business owners. Almost two-thirds are women-owned businesses, and over 40 percent of the businesses we work with are in low to moderate-income communities.
It's an incredibly diverse group of entrepreneurs that we get to work with. Every single one of them has these incredible, inspiring stories that just get us fired up every single day to come to work and know that we're playing this tiny little piece in their growth journey. That's how we want our investors to feel.
For every single offering, we help coordinate a professional video shoot to help the entrepreneurs tell their stories. It's almost a little mini shark tank where you can come to the Honeycomb site and hear these stories.
You can dig in and understand the health of the business, too. Of course, that's important. But then you get to decide which of these businesses you want to put your own hard-earned money into and see that money go to work in your community.
With my skepticism of community investing’s social impact long retired, I am thrilled to have the opportunity to invest in Honeycomb Credit’s loans. I made my first loan about 18 months ago, and every payment has been made on schedule, as promised. The business, a local restaurant, is thriving.
George has built Honeycomb Credit utilizing his superpower, an ability to use both data and a human connection in decision-making. For the sake of brevity, let’s call it analytical empathy.
AI Episode Summary
1. Devin Thorpe introduces his guest, George Cook, the founder and CEO of Honeycomb Credit, one of the leading crowdfunding portals focused on small businesses.
2. George Cook shares that Honeycomb Credit has grown from raising $1 million to being on its way to raising $25 million across its platform.
3. The platform enables small businesses to raise capital from customers, fans, community members, and internet supporters who are interested in aiding small businesses in their growth journey.
4. Honeycomb Credit has funded various businesses, including puzzle companies, ice cream shops, coffee shops, and microbreweries, helping them to purchase new equipment, launch product lines, or open additional locations.
5. The platform returns on investments can be compelling, offering a way for people to build a portfolio of loans with significant yields while also strengthening community ties as businesses repay their local supporters.
6. George discusses his background in banking and credit analytics and the need he saw for small businesses that were being left behind by traditional lending as industries evolved.
7. He shares the story of how he and his business school classmate co-founded Honeycomb Credit after his classmate, a former investment banker, had difficulties obtaining an SBA loan.
8. Honeycomb Credit focuses on empowering small businesses to raise capital from those who believe in them and know them, reinvigorating a sense of community lending.
9. George emphasizes the diversity of business owners who use Honeycomb, including women, BIPOC entrepreneurs, veteran-owned businesses, and businesses in low to moderate-income communities.
10. The company conducts thorough due diligence on all businesses seeking to raise money, including financial reviews, background checks, and credit reports, but also considers the businesses' community connections and customer relationships.
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George expanded on how he thinks about his analytical empathy superpower.
As a society, we talk so much these days about big data, machine learning and artificial intelligence and how that's changing everything. We forget the human connectivity. We sometimes think the world is all data. We forget that qualitative data can be just as important. An algorithm can't answer all your questions because so much of what we experience in the world isn't just a clean number.
Is the baget at the bakery–does it taste good? That's a hard thing to put into an algorithm to get a good result. So, being able to have an empathetic human connection while at the same time understanding and being able to leverage the power of data–if you can put those things together, the sky is the limit.
George uses his analytical empathy on every offering. Not only does the team crunch the numbers, but they also dive into the story to better understand what makes the entrepreneur and the business tick. They recognize that the numbers aren’t the only thing that matters.
He offers a profound starting point for developing greater analytical empathy. We’ve got to do away with the idea that we have to agree fundamentally with people to respect them. “At the human level,” we can “respect and appreciate” people even if we disagree.
Ultimately, George brought the conversation back to the impact of small business lending and community capital. He challenges us to remember that “nobody fights about ice cream.”
By following George’s advice and example, you can develop analytical empathy as a skill. With practice, you can make it a superpower that enables you to do more good in the world.
Remember, however, that research into success suggests that building on your own superpowers is more important than creating new ones or overcoming weaknesses. You do you!
Guest Profile
George Cook (he/him):
Co-Founder & CEO, Honeycomb Credit
About Honeycomb Credit: Honeycomb is a community capital platform where independently owned small businesses can borrow expansion loans from their own customers, fans, and community members. With Honeycomb, beloved local businesses are unlocking fair capital while building community wealth in the neighborhoods they serve.
Biographical Information: George Cook is the Co-Founder and CEO of Honeycomb Credit, a Pittsburgh-based, VC-backed loan crowdfunding website that allows locally owned small businesses to borrow expansion loans from their own loyal customers and fans. Honeycomb unlocks fair growth capital for Main Street businesses while simultaneously enabling anyone to invest local in their own communities.
Born and raised in southwestern Pennsylvania, George is a sixth-generation community banker. His community banking roots have driven him to search for new methods of capital formation and access to credit for small businesses. He started Honeycomb to counter the adverse effects resulting from the rapid consolidation of the community banking industry and to provide small businesses an alternative to predatory online loans that often do more harm than good. Prior to founding Honeycomb Credit, George worked at TransUnion and ZestAI to develop state-of-the-art data analytics tools that help lenders extend credit quickly and fairly. He has also previously served as an Economist at the U.S. Bureau of Labor Statistics.
George holds a Bachelor’s degree in Economics and Statistics from George Washington University and an MBA from the Tuck School of Business at Dartmouth College.
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CEO Explains the Social Impact of Funding Small Businesses - s11 ep57
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Superpowers for Good: Empowering Changemakers for Social Impact via Regulated Investment Crowdfunding from the SuperCrowd.
We host changemakers who are using regulated investment crowdfunding for social impact--impact crowdfunding--as impact investors or social entrepreneurs, catalyzing change with leadership skills we call superpowers.
We host changemakers who are using regulated investment crowdfunding for social impact--impact crowdfunding--as impact investors or social entrepreneurs, catalyzing change with leadership skills we call superpowers.
CEO Explains the Social Impact of Funding Small Businesses - s11 ep57