Startup of the Day: Cortera
Many words have been spilled since the start of the credit crisis lamenting the deficiencies of credit scores. The criticisms can be summed up to this: 670 Ficos didn’t perform as 670 Ficos were expected to perform.
When it comes to commercial lending, credit scores are even more tenuous. The variations between small companies are so difficult to quantify that “scores” that attempt to gauge a venture’s creditworthiness must be considered with some degree of skepticism.
That’s where Cortera, the Startup of the Day, comes in. Cortera aims to tap the internet masses to create a more refined assessment of credit worthiness for each and every company in the nation. The site officially launched today obviously aimed at competing directly with Dun & Bradstreet.
Cortera already is populated with stock corporate data, so there’s quite a large pool of companies already listed on the site. The user interface is clean, and the structure smart. Cortera dishes general corporate information, like start date and number of employees, and presents a “community rating” that is based on a five-star system. Check out this listing for Fidelity National Title Insurance Co., one of the nation’s largest title companies.
If it catches on, Cortera has a chance to make a difference in commercial lending. The price per “premium” report, which includes a Collections Priority Rating, or CPR, which is essentially a payment trend index, costs just $3. The least expensive report from Dun & Bradstreet is $39.99. DNB does not offer any free information, like Cortera.
There are two shortcomings to Cortera: 1) The site does not make available an API for intergrating a credit underwriting system; and 2) Cortera does a poor job of integrating records. For example, if you search for, say, “Citibank,” Cortera will spit back more than 50 records. Instead, there should be one, or at the most one per business line for Citi. But that’s what happens when you dump in a data file as Cortera apparently did.
OK, so Cortera is not perfect, but it is a worthy start. If Cortera really takes off, bankers will be the better for it.
