Sunbit: Enjoy Life with no Money Constraints
We only regret the chances we didn’t take — this is what works for life, friends, and business. It could be an item we want to buy or an event we want to attend.
But we can’t always afford everything we want at the moment. Or we couldn’t. Buy Now, Pay Later (BNPL) is a new payment method that allows people to purchase items online and pay sometime later, either delaying the payment date or splitting the cost into monthly installments.
The online shopping platforms with BNPL are growing and becoming popular, especially among teens and young people. Simple online shopping, effortless and safe, BNPL enables customers with more financial power.
However, it wasn’t all so simple. Long and detailed application procedures and uncertainty if it would be approved were the practices that precede what we have available today. Arad Levertov’s drive to create a better payment solution is why Sunbit exists today.
Beginning of the Idea
Arad Levertov was born and raised in Israel. He followed in his father's footsteps and wanted to become an industrial engineer with a problem-solving approach. This was his motive to graduate in Industrial Engineering and Management in 2005 at Ben-Gurion University in Negev, Israel.
His business idea was born on a random day, as Arad was shopping in the US only a few years after he moved from Israel. While buying groceries with his family in a big box retailer, a cashier offered to apply for the store credit card at the checkout. He accepted the invitation and jumped unexpectedly into a lengthy application process.
Arad answered all questions but felt invaded by many details for personal information, including his household income. What surprised him the most was the outcome of the process — he was declined.
Although aware that the limited credit file as a recent immigrant was the main reason, the feeling of embarrassment left the most substantial impact. His request was rejected in front of other people, the same as about half of the applicants.
This situation led Arad to think about finding a better way to access fast money in a quick procedure that won’t cost a bunch. He was also occupied with finding more personalized offers, which is something that modern technology can take care of.
As soon as he decided to create a better solution, Arad knew it was time to put the engineering knowledge into practice.
Acquiring Experience is the Key
When this incident in the big box retailer happened, Arad was employed in Enova International, a FinTech company, as a Chief Operating Officer. He began as an interim, and in almost 7 years, he led an $800 million project, responsible for P&L across Product, Marketing, Operations, Strategy, and HR with over 700 employees.
He learned a lot and succeeded in developing and launching high-profile flexible credit products that resulted in $130 million in revenue.
Before Enova, he spent almost 5 years at Intel as a Manufacturing System and System Developer earning vast experience. Aside from his specialty as a Bachelor in Industrial Engineering and Management, he was learning how to lead people in the business world, improving his communication skills, setting goals, motivating people, and directing them to focus on the right target.
Between Intel and Enovia, Arad moved to the US for greater opportunities and continued his education at Duke University. At the time, Arad had great math potential but lacked some leadership skills. This is where the University helped him develop as a person, as he had to work in teams and lead projects.
Another major part of his character was built from 1996 to 2001 while serving as Navy Seals Officer in the Israel Defense Forces. Arad was also doing a lot of mental training, learning that he could do more than he initially thought.
He now likes saying — it’s the mindset that matters the most.
Building the Team
Arad learned from his previous experience about risk mitigation when giving loans to people. He had a picture of how to make a product that most people would get and pay back without disturbing the bottom line of the fintech company.
As he says, the idea is for everybody to benefit. When people work hard to earn money, it is to have a quality life, and there’s no reason to wait.
Led by the idea of building a more transparent way of offering credit that will enable customers to purchase and complete payments, in 2016, he founded Sunbit with people he knew well from years ago.
Arad started Sunbit in Los Angeles thanks to California's great regulations for the specific product they started. With the co-founders, they decided to engage engineers and a data team from Israel. In parallel, while developing the product, Arad was screening the stores around, trying to find their first partner — a small boutique.
Sunbit Makes Payments Simple and Easy
One of the biggest challenges they had was trust — from both retailers and customers. The team had to convince the retailers to work with Sunbit’s tech and assure the customers that their personal information would be safe within the platform. And you can’t only build trust with words; you have to demonstrate virtue.
After a while, it is evident that the product was valuable for chores that couldn’t wait for a second longer, like fixing the car, going to the dentist, etc. Practice proved that the product worked well and fast, and the fact that they knew their target audience was a huge step.
When the customer has to pay, say, $1,000, the associate in the store will present the cost and can check if the customer is qualified for BNPL payment through any identification document.
In only a few seconds, after getting consent from the customer, by scanning the barcode, people from Sunbit can get a credit report, authorize the customer, and allow them to split the payment in 3, 6, or 12 months. And this is possible with 9 out of 10 applicants.
The process is fast: the customer completes the sale, Sunbit pays the store and collects the money over time from the customer. While they aren’t the only company offering such services, Sunbit has become a key player in the BNPL market with dedicated work over the past years.
Funding an Idea
The company, with headquarters in Los Angeles, now offers local service to providers and retailers, but its start was rather bumpy.
Even after the documentation was collected, they had to acquire enough funds to support their idea. They held their first funding round in January 2016 and earned only $120,000. Their following funding was a Seed Round, and even though it was held only a couple of months later, it was far more successful, acquiring them $2.9 million.
Sunbit has collected $210 million across 7 rounds from 17 investors.
Today and Beyond
Arad's mission was to extend the BNPL model, help everyone make the most of their purchasing power, and get access to the things they needed. What is Sunbit today just proves that Arad succeeded.
Sunbit is available in over 13,000 locations nationwide and has over 80,000 people certified to provide Sunbit’s help with a 90% approval rate.
Sunbit continuously aims to reduce risks and application costs and improve analytics. With the help of machine learning and artificial intelligence, Arad believes that Sunbit will be able to give more people access to fair and transparent credit rates. The success so far proves that Sunbit offers quality solutions.