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00:00Jacqui we briefly touched about touched on this issue of access to capital which is just a persistent problem an issue that small business owners talk about you have Square Capital. Tell us about that effort and what some of your observations have been in that in that hierarchy of needs. We focused initially on helping a small business owner entrepreneur artist musician just simply make the sale and then we asked a question can we actually help them make more sales and what's blocking that no one is really an understanding of the business giving them data around what's happening within their business what they're selling what the patterns are of their customers just understanding exactly what's happening day to day which a lot of businesses we found didn't really have access to because usually all this data spread apart into multiple systems and it's really hard to combine them. It's really lossy. So as we gave understanding to our sellers we saw another opportunity to save a trip to the bank where the banks weren't necessarily serving a particular need which was giving a capital advance or a loan of anything from 500 dollars all the way up to a million dollars to a lot of these businesses. And our focus has really been around speed. We want to be fast because if we can be fast for saving people time and we're giving time back to spend for them to spend on what is more meaningful. So we created a system that will actually e-mail you and it'll say do you want 5000 dollars . Here's the here's the rate of the loan. And you tap on a button that goes in your bank account the very next business morning and the way you pay it back is actually just every time you swipe one of our customer's credit cards. We add a little fee on top and it pays back automatically. So we've seen this really interesting model where just by running your business just by growing your business it just works. And that's been fantastic. We've been able to really push out hundreds of millions of dollars to over 100000 sellers in our in our base. And again it's no trip to the bank. The money appears immediately and you can start using it and pay it back effortlessly and we think that's really important is that simplicity in that speed giving time back to people to really focus on their business. And if they grow their business we grow our business. So we have a nice virtuous loop within within the cycle that really helps to produce the report found that the overwhelming majority of small businesses are seeking capital from banks. But I thought it was interesting because they're getting roughly 40 percent of what they ask the average small business ask was about one hundred thousand dollars and they're getting about 40000 so like what. That's a good question to you. I know Goldman Sachs has done a lot in terms with its capital partners in giving loans. But how do you unlock that. I think that's right in Jack's case. First of all the problem with banks today is evolving theirs is evolving regulation and that'll iterate with the needs of they are the consumers of banking services and we'll have to get to the right place so there's still a moment in time where it's not at equilibrium not necessarily where it's going to end up in terms of banks willingness to take risk and the needs and into that void comes other man banking services especially for small loan needs. And in the case of Jack's business the you know the real opportunity has that in fact he's created is that he knows almost better than the borrowers themselves of what their capacity is to borrow and pay back the disease processing all their transactions and knows as much about them in some cases has better analytics than the people themselves that were doing that business. And so he's positioned himself very well and he used the word virtuous in this what a virtuous circle because you know we're all talking about creating employment in our business but helping to create employment other people's business by supplying them with capital. And frankly those people will produce more or hire more people. And by the way that's the system that's the ideal system that really is the backbone of America. That's what you know I daresay it's contested in many places but that's what capitalism is. And this is a testimonial to it .

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Dorsey, Blankfein on Small Business Access to Capital

Goldman Sachs 10,000 Small Businesses Graduation. The panel includes: Goldman Sachs Chairman and CEO Lloyd Blankfein, Bloomberg LP and Bloomberg Philanthropies founder Michael Bloomberg, Berkshire Hathaway Chairman and CEO Warren Buffett, and Twitter and Square co-founder and CEO Jack Dorsey. (Michael R. Bloomberg is the founder and majority owner of Bloomberg LP, the parent company of Bloomberg News.) (Source: Bloomberg)

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