This Kabbage reviews post will share my finding on the main features of the startup loan provider. You will also learn if the actual users of the service had a positive or negative experience with the company. You will also learn the level of interest toward the firm over the past 5 years, which can imply the quality of their service and trustworthiness.
You may have already checked their website before my post. Then you would have already known that you can apply for a startup loan on their website, and Kabbage promises a fast decision time. What does that mean? They use their automated technology to validate your application digitally. I have experiences in the loan industry and this online validation with minimal interventions by human assessors is trending in the market.
According to Wikipedia, this Atlanta-based lending firm started in 2009 and the firm publicly launched and began making its first loans in May 2011. In 2012, the firm raised $30 million and was named one of Red Herring’s Top 100 North American private companies. Since then, Kabbage continuously raised a serious of capitals and won awards. Just by looking at the company history, I was convinced about the quality of their service and product.
We all learned that their major product is a loan to startups and they make a fast decision using technologies. Let’s find it in detail.
Yes, it is business loans. On their homepage, they point out that “Kabbage looks at your business performance — not just a credit score — to let you know right away how much funding you can access.” This is the core principle of Kabbage. They basically invest in your firm based on the performance of your business. That’s it. Let me share their minimum requirements to be qualified for application.
Requirements & Obligations
To be qualified, you should be in business for at least one year. And, you should have a minimum of $50,000 in annual revenue or $4,200 per month over the past three months. Among their application conditions, two points caught my attention. One is your application will be free of charge. Another condition is you have no obligation to take funds.
I believe that these two conditions drive many startups into actual application since applicants don’t have to be worried about any cost or legal responsibility to take funds. More specifically, once you get approved and the fund comes to your account, you can use only the amount you need when you need it.
In exchange for the funds, you pay simply monthly fee. It is counterintuitive that you are obliged to pay a fee, not the interest against the loan principal. What’s more, you can pay off your loan early without having to pay extra charges. They don’t penalize you for early full payment. These benefits differentiate Kabbage from other traditional banks.
- Every month, you pay back the same portion of the loan principal plus the monthly fee.
- If your term is 6 month, it requires a minimum of $500 loan.
- You fee rate will range between 1.5% and 10% depending on the principal amount.
Kabbage offers three options for repayment terms – 6 months, 12 months, and 18 months. Your repayment amount will become different based on the term you choose. Due to the numerous factors, I recommend you to use their loan calculator to simulate your loan amount, loan term, a fee rate, and savings when you pay off early. To use the calculator, please try this link.
Loan Use Cases
Regardless of your industry, you need capital to run your business. How would you want to spend your business loan? In my personal opinion, spending wisely is as hard as earning money. For the cases below, I referred to the loan uses of Kabbage.
Develop New Products or Services
Developing new products and services requires money. You may have been earning enough money to maintain your business. How about launching new products? That often requires additional funds. For your business expansion, you could take advantage of Kabbage business loan.
Additional tools or upgraded equipment can boost work efficiency, which can also lead to cost reduction in long-term and time saving in short-term. If this fits your business needs and your business lacks seed money, it might be a reasonable decision to use loans.
Fill Up Inventory
Your business can be seasonal that in certain times, some popular products are sold out fast and you need to order extra stock. You might need additional cash to make sure that your popular products are always there for your customers. In this case, loans can be really useful.
Smooth Cash Flow
Your business may experience fluctuations in cash flow. To ensure ongoing business during downtimes, you might need consistent cash flow. If this is the case, you may want to consider small business loans.
Marketing or Campaign
You may want to launch a marketing or advertisement campaign to promote your brand and products. When you carry out marketing, the cost can be a burden to your business. Kabbage small business loan can help you to conduct such a campaign.
Hire More Staff Members
You are witnessing a growth in your business and are needing more people to support the expansion. It could be a good idea to use loans as seed money to maintain the momentum of your business.
You might be seeing an opportunity on the horizon, and you want to grab it before anyone else. No one will deny that it is important to grab the right opportunity in a timely manner. Achieving this requires money, and without funds, it could be hard to keep agility for the opportunity.
What is an application like?
We’ve discovered the major features of Kabbage small business loan. The section above listed the use cases for you to have an idea when you may need business loans. Let’s find out how applying is like on Kabbage.
Kabbage claims “applying is quick and easy and typically takes less than 10 minutes.” on their website. They explain that they will require basic information about you and your business. The rest heavy-lifting is done by their digital validation technology. They will connect your business bank accounts securely and use those data to validate your application. It seems like they can also import data from accounting software tools such as Intuit QuickBooks, eBay, Amazon, PayPal, Xero, and Stripe. They added that the firm might ask additional details for potentially an extended amount up to $250,000.
As I explained, to be eligible, your business should be at least one year old. And, your revenue should be $50,000 in annum or $4,200 per month over the last three months. Please note that if your industry is in the following, you will not be qualified.
- Financial institutions
- Lending or non-profit organizations
As a part of the application process, Kabbage will also check your credit history.
The firm points out that the more revenue you can show them, the better chance for qualification. So please make sure to submit accounts and link services to increase your chance.
When can you get your funds?
Approval takes only several minutes. After that, when the loan agreement is signed, the funds will be ready to be deposited into your account of your choice. If you choose a bank account for deposit, it takes 0-3 business days to process. If you select your PayPal account, Kabbage says that it takes just a few minutes. If you use the Kabbage Card for withdrawal, your loan is issued immediately for the same amount of that transaction.
How People Think About TransferWise
When you see product introduction from a company, you will always hear great things about it. No company will reveal any weaknesses or defects of the product, obviously. So, as a consumer, it is wiser to doubt what they say and do your own research before making a final purchase decision. In this section, we will learn how actual users think about Kabbage. How can we measure these? We can do this by using data analysis techniques called sentiment analysis.
You don’t have to be scared by the technical term. I did the technical part and you can just look at pretty graphs. In this section, I will show you two types of graphs – word cloud and customer sentiment chart. For the analysis, I’ve compiled more than 5,500 customer reviews from TrustPilot and conducted analysis to summarize them. I will show you the result in a word cloud and a customer sentiments chart. And, lastly, I will share a Kabbage’s Google trend result that shows the level of interest from people.
Word cloud is one of the great and fun ways to understand customer sentiments toward a product or a service. In a word cloud, you can see specific words in different sizes. The larger it is, the more people used that word to describe the product. For this word cloud, I used the titles of the reviews, since people put the essence of their opinions in the title. The 5,500+ reviews allowed me to generate an interesting word cloud that let me reach a positive conclusion. Let’s have a look!
Understanding the word cloud is easy. Just follow your eyes and see what you see. You will see that most of the big words are all positive. This means that customers have had a positive experience with their product and service. People used words like “easy”, “fast”, “excellent”, “great”, “quick”, and many more positive terms to describe this transfer platform.
In the word cloud, I could find that people also often mentioned “quick” and “easy”. In my opinion, these descriptions are very important since they support what they claimed for the ease of use and the approval speed.
In the word cloud, we were able to observe what descriptive words people used to talk about Kabbage. As mentioned, the word cloud is based on the titles of customer reviews, but the sentiment analysis graph was generated by the contents of the reviews. In the sentiment analysis, we will see more specific types of feeling that people showed in their review. In the analysis, you can see 10 different sentiments such as positive, negative, trust, anticipation, joy, fear, sadness, anger, surprise, and disgust.
The technology behind the chart is straightforward. The analysis algorithm holds 10 different lists – each list containing words that are mapped to one of the 10 sentiments. When this algorithm runs, it checks and matches with one of the sentiments. When matched, it is counted as one and is categorized in one of the 10 sentiments. My analysis on the positive reviews appears as below.
The chart is also not difficult to understand. You can see that the positive sentiment is ranked number one. The first rank is followed by “negative”, “trust”, “anticipation” and “joy”. It does have some negative opinions, but overall, people expressed more positive sentiments than negative ones. So my customer review analysis told me that many people have a positive experience with this lending firm.
As the final segment of analysis, let me share the trend of Kabbage. I used Google Trend to check how frequently “Kabbage” is searched on Google over the past 5 years. Google Trend is a useful tool to measure the interest of people. The more frequently people search on Google, the more popular or trendy it is. The Google Trend (may not visible on a mobile phone) of the firm below shows that people have consistently shown an interest in Kabbage over that period.
If this trend continues, the level of interest is likely to go up slightly in the future. Please note that the trend is from the United States. Their service is available only in the U.S. If I divide it by state, we can see that the largest interest came from Georgia. The rank below tells that the second biggest interest came from New Hampshire followed by New York, Florida, and Arizona.
As I researched Kabbage, I found that their product, small business loans, and the process of application are made so easy and simple. My analysis of Kabbage reviews from actual customers proved that most of the people had a great experience with the company. If you are looking for loans for your business, Kabbage can be a great choice!
If you want to estimate your loans and repayments, check their loan calculator.
If you want to calculate the return on investment when you have the extra money from Kabbage, check their ROI calculator.