Fundbox CEO Prashant Fuloria Interview Transcript

Clint Betts

Prashant, it's so great of you to be on the show, honored to have you. Give us a sense of Fundbox and how you became the CEO. I know that you were the COO previously, you were the product officer, you spent some time at Yahoo, you spent some time at Facebook, Flurry, and Google. I mean, you have this long history, a great career with all these major tech companies. Give us a sense of how you got to where you are today.

Prashant Fuloria

Thank you, Clint, for having me. I really appreciate it. I have optimized my career for learning, and that thought process has taken me to a number of different companies and in different roles. I started my career as an early product manager at Google. It was a very small company at that time, with fewer than 1,000 people. And I was a product manager working on this product called AdWords, which, of course, has now become this $100 billion-plus business for Google. And I learned a lot through those early days of Google.

And I also had the good fortune to move on from Google after about six or seven years there to Facebook when it was a very young company. Again, like a few hundred people. Also worked on advertising and monetization, and did a start-up called Flurry, which was acquired by Yahoo. So I sometimes joke that I have done Yahoo, Google, and Facebook, but not in the right order.

It was actually a Yahoo that I got talking to a gentleman named Eyal, who was actually the founder of Fundbox. He had started Fundbox in Israel, and then had moved to the Bay Area, and was looking for someone to partner with to help him scale the company. And right from the moment I heard about what Fundbox was about, and I'll share that with you in a second, I was instantly intrigued, and ended up joining them a few months into that journey, into that conversation.

And what Fundbox does and why it intrigued me so much was that Fundbox is a capital platform for small businesses, which is just a fancy way of saying that Fundbox provides a variety of financing solutions to small business owners. And we do it by partnering with the very tools and systems they're already using to run and grow their businesses. So our customers typically don't come to us, we go to them because we partner with folks like QuickBooks, which is the largest, most popular accounting software platform in the US. We partner with big payment providers like Stripe. We partner with a number of other invoicing apps, accounting software systems, payment providers, and software tools that small business owners use.

And the reason why it intrigued me so much was that I'm a technologist, and I like this idea of technology helping level the playing field between the big and the small. And when I was working on AdWords, one thing that really resonated with me was that in the AdWords auction, it doesn't matter whether you're a local grocery store or a retailer that's across the country, you're competing in the same auction on fair terms. And I thought if technology can help democratize access to advertising and marketing across companies, big and small, why couldn't technology do the same thing for other important services? And I knew from my experience with small businesses that access to capital was like oxygen to them, super critical. And so it was that mission that really intrigued me, and that's what's kept me going at Fundbox now, nine years into the journey.

Clint Betts

That is incredible. So, give us a sense, what is the mission of Fundbox ultimately?

Prashant Fuloria

The mission of Fundbox is to help power the small business economy. We, like so many others around us, see small businesses as being incredibly important for us in terms of the economy, in terms of our society, and yet, the deck is often stacked against the small business owner. They don't necessarily have access to the tools and the resources that a mid-market or an enterprise company has.

In a mid-market or an enterprise company, you've got the entire office of the CFO, and they're focused on finance and all things finance. And so if you had to go raise some money to expand your business, well, you've got a bunch of experts who are there to help you, and you have access to banks and other large institutions. If you're a small business owner, you're probably doing this all by yourself, and you probably started your small business because you love the craft, you love what you do. And that could be anything. It could be baking, it could be plumbing, it could be building something, you could be a lawyer, but what you're not is a finance person, typically. And that's the thing you least like about running your business.

And so if we can make it easier for you to be able to handle that part, the more administrative part of your business, which includes making sure that you have access to a smooth cash flow, well, we can make your life just that little bit easier and help you focus on what you really want to do. And so that's really the mission behind Fundbox.

And the strategy, if you will, is rather than trying to go after customers directly and advertise to them and reach them where they are, why not go into the systems that they're already using? So just be present everywhere so that if I'm issuing my invoices and I need to get funds against an invoice I've sent to a customer who hasn't paid me yet, why can't I just click on a button and get funds immediately as opposed to having to go through a whole long expensive process? So that's a little bit about what we do.

Clint Betts

It's actually really interesting. That's beautiful, man. And how has AI changed everything for you both internally and externally?

Prashant Fuloria

Clint, it's interesting you mentioned AI because the word AI has been used for a long time, and it may mean different things. And some of us sitting in Silicon Valley joke that when you use the word data or statistics, that's sort of one thing. And the moment you use the word AI, you're now in la-la land. But we've been using statistics for a long time, and we've been using machine learning for a long time to be able to make predictions on the risk of a small business or any of their transactions. And that's critical because ultimately, what you want to do is to give small business owners a responsible amount of capital. If you give them too little, well, that hurts their business, it stunts their growth, it impacts their chances of success. You can also make a mistake by giving them too much. It has to be a responsible amount.

What if you saddle yourself with a debt and you can't really pay it back because your incoming cash flows can't support it? Well, no one's doing anyone any favors by doing something like that. And so assessing the risk of a business or any of their transactions is something that's critical. And we've been using AI statistical tools for a long time in order to do this.

Now, in the past, it would be mostly machine learning, and now there's a little bit more of GenAI tools that are being used in that process. So for us, AI is a tool, it's a means to an end. We use AI a lot, but our focus is on serving the small business owner.

Clint Betts

Yeah, I mean, where do you think this whole AI thing is going? And obviously, none of us knows the actual answer to that, and it changes every day, every second. By the time we're done, some crazy new thing will be announced around this thing. Where do you think we're headed, though, just given your experience and history in the tech industry? And then, like you said, too, AI isn't new. ChatGPT made it part of the daily conversation and showed the power of it, but AI has been used for decades. Just give us a sense for how you're thinking about it in the future. Not even just as it relates to Fundbox, but just generally.

Prashant Fuloria

I think that there are many places where AI is already making a significant change in the way companies are being run, and that includes Fundbox. And I can mention at least three off the top of my head. One, anywhere where software is being developed. I think the tools to help you develop software faster and better are there today. And so we use a lot of AI when we write our own software, which makes our engineers so much more productive.

We're not actively growing our team significantly because we're seeing increased productivity with the people that we already have. And so I think we're very much in that here and now in terms of the impact of AI on engineering productivity. So that's sort of one thing.

I think another thing that impacts companies across the board, including us, is AI in terms of customer conversations. There are so many places where customers just want the right answer at the right time. They don't want to wait. And AI in chat, AI in voice is already impacting customer service in a positive way across the board. So that's already there.

I think another use of AI, which is there today in companies, is just knowledge. There are so many emails and Slack messages and internal documents that are lying around that sometimes in the past, I found it difficult to just remember I spoke with this person in this context, and they said something, but I just don't remember where it was and when it was, and it's hard to find that. And now that's becoming a lot easier to understand.

And by the way, when you're onboarding a new employee, for them to quickly answer, get all the questions answered without having them feel bad about disturbing somebody all the time, well, that's happening today.

So there are many places where AI is already impacting us in the here and now, and it's just going to accelerate. So I think we don't exactly know where it's going to go, but I think what we all know is that it's really important for everyone in the company, whether you're an engineer, a customer support rep, or whether you're a credit analyst looking at our underwriting to be thinking about all the tools that are out there.

And I think what's so interesting and almost beautiful about AI is that we're all learning and we're all starting from the same place. So it's not like I have an advantage over you because I've been doing it for 20 years, or Company X is better off because it's all new. So it's just an opportunity for us to build something, again, from the ground up.

Clint Betts

What does a typical day look like for you?

Prashant Fuloria

A typical day is a lot of conversations. So there's a lot of asking questions and then listening to what people say, whether they are inside the company, our employees, my colleagues, whether it's customers, small business owners, or increasingly the partners with whom we work, sometimes investors. There's a fair amount of reading just to keep up to date on what's happening. The world is increasingly complex, changing very fast, and very unpredictable.

There is some amount of just thinking, and then there's some amount of obviously time that I spend with my family, just taking care of myself, staying active, and importantly, enough time to sleep. And I can't stress that enough. I'm a big believer in getting the right amount of sleep that you need in order to be able to make your day as productive as possible.

Clint Betts

Yeah, sleep is incredibly important. It's nuts, it's actually nuts. And I think for leaders and founders and CEOs, you can sacrifice sleep to your own detriment.

Prashant Fuloria

I think so. By the way, I think it was fashionable, say, 10, 20 years ago, to talk about how little sleep you got or how little sleep you needed to get by. But I think one of the good things about where we are today is that people recognize the importance of sleep and self-care. I think it's important for everybody, including leaders, because if you're running low on sleep and your judgment is impaired or you're snappy with people, you can cause a lot of damage very quickly. So you need to make sure that you're well-rested, you're thinking straight, and you're being in the moment when you're having a conversation or listening to someone. And again, your body can only take so much, and you have to take care of it.

Clint Betts

How do you think about culture and the company's values, and maintaining those? And that leads to the second part of that question, which is hybrid versus in-person versus entirely remote workforces and how you've landed on all of that.

Prashant Fuloria

Look, I think culture is very simple. I think culture is what you do and not what you say. Look, my philosophy on life is very simple: I think people aren't idiots, and don't be surprised, but what I mean by that is you can't say one thing and do something else. Eventually, people look around, and they understand what a person is doing. And if that person happens to be in a position of leadership, then they learn accordingly.

So I think the only way to build a culture is by doing the things that you want people to do. So, for example, if you want people to be respectful, well, you've got to be respectful yourself in every interaction as much as you humanly can. If you want people to be customer-centric, well, you have to be customer-centric yourself. If you want people to be innovative and think about new ideas, you've got to do it yourself, and you've got to also appreciate it when people come to you with ideas and engage with them and try to make the best of them, those ideas. So to me, culture is very much about what you're doing, and then surrounding yourself and building a team of people for whom those values are important.

And I think every company is different. And there are many places where you can have a very successful company that has a certain culture, let's say, a very hard-driving culture, where there's a lot of competition inside the company. You can have successful companies that are much more collaborative and collegial. I'm not making a value judgment about what is good and what is bad, but what I am saying is that it may be better to be very upfront with people both in the company and those who are thinking of joining, which is how we roll, and this is how we operate. And I think that also drives a self-selection.

If I like a collaborative environment, well, I will gravitate towards a company that talks about it openly. But if I'm wired differently, I might not want to do that. And so I think it's almost better for everyone if you can articulate your culture very clearly and if you can, through your conversation, share with people how you work, such that they can make the decision about whether to join you or stay with you versus going somewhere else where they would be happier.

Clint Betts

How do you think about where we are economically? And you have a front row seat to the state of small business in the United States, and even more broadly, the effect that tariffs have had or not had, and all of that type of stuff. Where do you think we're at? We're more than six, seven months into this thing now this year. How are things looking, and what's the outlook towards the end of the year?

Prashant Fuloria

I think taking a step back from the current six to seven months, there are some very interesting trends in the small business economy more broadly. I think the first thing is that people are increasingly turning to starting their own small businesses. And we've seen the number of small businesses in the US grow three times as fast as the population of the country over the last decade. So the population has grown, but the number of SMBs has, on a percentage basis, has grown three times as fast. So there's definitely something here where more and more people are either thinking of starting a new business from scratch or, in some cases, buying somebody else's business and running it.

The other thing that's interesting is that the number of new business starts every week, every month, doubled around the pandemic, and soon after the pandemic. And while many pandemic-era changes, things that happened in 2020, have sort of reversed a little bit. And we can talk about working from home and hybrid and all of that, but the number of new business starts, so new business formation, remains elevated compared to where it was pre-2020.

So I think there is... whether it's a cultural thing where people want to do their own thing and not work for a large organization, I'm not quite sure, but we see this in the numbers. So that's one thing.

I think the other thing that's very interesting is that more and more small businesses are becoming digital in nature. And I don't just mean somebody who's selling things on Amazon. I mean every kind of small business, you could be a hairdresser, but you're using some sort of digital tool to manage your schedule, your bookings, to get paid. You could be a law firm, and you're using an invoicing app or legal practice management software. So that's another thing that's happening.

And so we see all of that because those, call it secular trends or more long-term trends, have been at play for some time, and they just continue to grow. So more than 50% of small businesses in the US today are using some sort of what people sometimes call vertical SaaS, vertical software, software for their vertical, whether you're a plumber, an electrician, a lawyer, or an accountant. And so we're seeing that for sure.

Now, more specifically for what's happening in the last seven months, I think the small business economy remains strong. It has remained fairly resilient so far. We haven't seen any increase in small business risk as of now. We haven't seen any increased stress more broadly across the spectrum in small businesses.

I think there were some very, very specific vertical issues. For example, some transportation companies were impacted, especially on the West Coast, when there was a slowdown in imports happening, in LA and San Diego, and these large ports. So there were some very specific areas, but we haven't seen any major downturn yet, where we seem to be all right. And of course, there are tailwinds, there are headwinds. Right now, they seem to be balancing each other out.

Clint Betts

Do you think that continues? Not to have the whole interview focused on AI, but I do wonder, man, we have these major companies, some of them you've worked for, like Google, for example, who can spend billions and billions and billions of dollars on AI. I mean, Google has Waymo, for example, on the transportation front and things of that nature. How do we make sure that small businesses remain, like you just said, relatively as many headwinds as tailwinds? And how do we increase entrepreneurship? Do you think about that at all? I mean, and obviously that's a big part of what Fundbox does.

Prashant Fuloria

Yeah. I think AI can be a challenge, but it's also a really interesting opportunity for a small business owner because AI can actually be a way to supplement the resources that you have.

And I'll give you an example of one of our partners, Fundbox's partners is a company that serves home service professionals: electricians, plumbers, HVAC installers. And many of these small business owners don't necessarily have an admin to manage scheduling.

So, for example, if you had a leaky faucet and you're calling a plumber, very often you're calling them on their cell phone. They're at a job site, they can't take your call, so they may miss the opportunity. You may call somebody else. Now imagine if that plumber actually had an AI assistant who could say, "Clint, what problem do you have?" You could say, "Look, my sink is leaking, or what have you." And they could ask you for some information like, "Oh, you live at this place," and so on, and then book an appointment for you without having the plumber stop working on what he or she's working on.

So I think that's a way in which a call answering service, which may otherwise only be available to a mid-market company, now becomes available at a fairly high quality. And one of our partners has actually built this out. So I do think that there are these really interesting ways in which AI can help small business owners.

And then unlike a very large organization where there may be inertia, a lot of decision-makers around implementing a technology and also people who may have a vested interest in not implementing something because their role in the company gets impacted in some way, for a small business, there aren't a lot of such internal dynamics and politics. And so I think, and maybe I'm being overly optimistic, but I do hope to see... I do see a little bit of small business owners embracing those tools because they can, and they're less encumbered by the way they're doing things today, unlike a much larger organization.

Clint Betts

Yeah, yeah, that makes total sense. I want to be respectful of your time, so the final question, we ask everybody this question, and that is at CEO.com, we believe the chances one gives are just as important as the chances one takes. When you hear that, who gave you a chance to get you to where you are today?

Prashant Fuloria

A lot of people took a chance on me to get me to where I am today. I think of my time at Google, which was a big break for me to work there back in 2003. And the SVP of product management, a gentleman named Jonathan Rosenberg, really wanted to hire folks like me with my background, but I didn't have a degree in computer science. I was an engineer by training, and I had a PhD from Stanford, but at the business school, Larry and Sergey were very dogmatic about We're only going to hire people with degrees in computer science.

And I remember Jonathan Rosenberg did this little trick. He told them, "This guy, Prashant, and a few others like him, I'm hiring them as business product managers, so not really product managers." And Larry and Sergey were like, "That's fine. He's got the degree, it's okay, [inaudible 00:23:11]." And so I got hired into Google under this new job category called business product manager. And when I got there, I just started doing the same work that everybody else did, and no one seemed to care or mind, and it was all okay, but it was a little bit of inventiveness on Jonathan's part. And there are a dozen others like him who've given me that break at the right time, and for whom I'm very, very grateful.

Clint Betts

Prashant, thank you so much for coming on. Congratulations on everything that you're building here with Fundbox. What's been built. Again, it's just an incredible company, super valuable in the world. Honored to have you. Thank you so much.

Prashant Fuloria

Thank you for having me.

Edited for readability.