When the Covid-19 pandemic forced small businesses the world over to close their doors, Yanir Yakutiel, founder of Australian SME lender Lumi, knew he needed to move fast. Lumi’s mission is to provide capital to the country’s huge tribe of small businesses. Without access to funds quickly, he knew many of them would struggle to stay afloat through the crisis.

“The Australian government came up with an AUS$40 billion loan-guarantee scheme to encourage banks and non-bank lenders like us to keep the flow of capital going to small businesses. We applied, got accredited and then started making around 90% of our loans under that scheme,” says Yakutiel.

The pandemic also prompted Lumi to accelerate its plans to launch its next product – a flexible line of credit similar to an overdraft. This is now being offered under the government guarantee alongside its existing short-term unsecured loans.

Fast, flexible solutions

The Australian government’s guarantee scheme includes no repayments for the first six months and covers 50 per cent of the loan if the borrower is unable to repay. Thanks to these business-friendly features, he says, Lumi can forge ahead with its aim: channelling funds to small businesses.

“We think it’s a great scheme and we’re very excited to be part of it. It really helps us achieve our purpose, which is to help capitalise small businesses,” says Yakutiel. “Without it, the market for unsecured loans would literally dry up in a second. No one would do it.”

Yakutiel, who has a background in logistics, finance and law and previously founded fintech Sail, set up Lumi in 2018. One of the advantages of running your own business is that you can be closer to your family. Yakutiel’s son is a familiar face for the entire Lumi team. “For me it’s a privilege that I get to spend so much time with him, plus build an amazing business at the same time,” he adds. “Having said that, the average age of the Lumi staff is closer to him than to me.”

Mixing parenthood and the start-up life

In spite of its reputation for all-night working and empty pizza boxes, the start-up environment can fit well with family commitments, says Yakutiel. “The key is that when you start a new company you can set the culture and what’s acceptable in terms of balancing family and work.”

The key to success, he says, is managing time carefully. And the benefits cut both ways – he gets to be a hands-on parent and run his business while his son gets to see close-up how a company works. “There’s a definite benefit from being in this sort of environment to gain life skills you wouldn’t typically get at such a young age,” he says.

Lumi is an Australian small business lending specialist offering secured and unsecured business loans between $5,000 - $500,000 with three to 36 month terms.

Revisit Lumi's success story here.