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Banking & Finance

Financial Data Startup Expands Access To Tools, Sets Capital Goal

By Audrey Elsberry, posted May 23, 2024
Wilmington-based financial data startup Lumos Technologies debuted Lumos Launch Pad, a free platform that allows customers to explore the company’s tools, on Tuesday.
 
Lumos has a financial institution customer base, and the company’s packaging of financial data helps lenders gain insights when adding to their lending portfolios. The Launch Pad is a way for potential clients to engage with Lumos’s various dashboards for free, increasing exposure, said Youri Nelson, co-founder and chief technology officer at Lumos.
 
The product gives anyone access to five Lumos data dashboards. The Lumos Small Business Economic Index, SBA 7(a) lending analysis, SBA 7(a) acquisitions, SBA lending to majority women-owned businesses and Bank Key Summary Metrics can all be accessed through the Launch Pad.

The data Lumos uses is publicly available, but the Lumos team organizes the data and creates visualizations for financial institutions, Nelson said. The program went live on Lumos’s website with a soft launch about two weeks ago, Nelson said, and the company announced the update online on Tuesday.
 
The company has about 80 paying users comprised of financial institutions ranging from small credit unions to large banks across the country, Nelson said. Lumos officials have an ambitious goal of doubling that number by the end of the year, he said.
 
Nelson said the company is in the process of building its second capital raise. Lumos had an initial $3 million investment from Summit Technology Group in 2022, Nelson said, but has not raised money since. Now, its next seed round will likely close by mid-summer with a goal of raising $2 million to $3 million, he said. The money is expected to come from friends and family and potentially a couple of strategic investors focused on financial technology and the banking sector.
 
Since the company’s founding in 2021, it has rolled out several online tools such as its Prime+ Score, which is a predictive business performance model, and Lumos Portfolio Score, which helps financial institutions analyze risk associated with their small business loan portfolios.
 
Now, the company has shifted its focus from building new tools to marketing those tools.
 
“We're in the middle of fundraising our next round,” Nelson said. “And the intent of that raise is to focus more heavily on sales and marketing, and not necessarily put out new products but enhance the existing offering and making it more robust. And essentially, making more noise about what we're currently doing.”
 
The Lumos team has seen a significant increase in attention to its products this year, he said. He credits the attention to changes to the Small Business Association’s Standard Operating Procedures from 2023 as well as a push by banks to be more cost-efficient in lending to small businesses. The changes allow small business lenders to use small business credit scores like Lumos’s Prime+ Score to aid in lending decisions under $500,000.
 
“In terms of timing, it's great for us," Nelson said, "because we've got that tool that banks can use, and a lot of banks aren't satisfied with what's currently available in the market."
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