In an interview with InnovationMap, Carolyn Rodz, CEO and founder of Hello Alice, explains how the partnership came about and how the program will significantly move the needle on equitable access to capital for small business owners. Photo courtesy of Hello Alice

Last month, Hello Alice — now with 1 million members in its community — announced a new program with MasterCard that provides small business owners a simpler way to unlock access to capital.

The Hello Alice Small Business Mastercard offers users expert business advice, business insights, cash back, and a rewards program that gives entrepreneurs points for completing business-advancing activities on the Hello Alice platform.

"As a small business owner myself, I've created a card that I wish I would have had," Carolyn Rodz, CEO and founder of Hello Alice, tells InnovationMap. "We really looked at where are the gaps for these business owners and the things they don't already have or are unable to access."

In an interview with InnovationMap, Rodz explains how the partnership came about and how the program will significantly move the needle on equitable access to capital for small business owners.

InnovationMap: How did this partnership come about to provide this this unique credit card for small business owners?

Carolyn Rodz: We have been looking at ways to support business owners along their capital journeys for a long time. Since we started Hello Alice access to capital has been the number one barrier for small business owners, and that's only magnified when we look at business owners of color and our new majority business owners that we focus on. And so it made natural sense as we went down a path of conversations with MasterCard initially around how do we create something, particularly in a world where accessing capital, which would be daunting for business owners.

There's a lot of talk around venture capital and getting loans and what that growth journey looks like. But the reality is most business owners understand a credit card — they understand how it works. So, that was a great starting point for us. Then we looked at what are some of the issues with cards — all business cards particularly or commodities. They're typically an afterthought from a lot of the financial institutions that offer them. We're seeing a lot of these emerging fintech companies that are rolling out cards, but even for them, the small business audience is typically an afterthought. They're really focused on tech companies and very rapid growth businesses.

It felt like mainstream small businesses were really getting lost in this conversation, so that was where we really wanted to tackle. How do we solve some of these problems — how do we create benefits that are actually meaningful to small business owners? Things like one-on-one coaching and helping them get access to workshops that will help them along their growth journey. Things that they can redeem points for experiences and opportunities that that may not otherwise be accessible through a lot of these business owners.

The other piece that we wanted to support is the large group of businesses that don't qualify for a traditional credit card. And so we, in tandem with our unsecured credit card, also launched a secured card. And the idea for that was that we could actually roll out a credit quality tool. So, in conjunction with all the education and wraparound services that we're offering, there's a six- to nine-month process that a business owner — if they have poor credit history — can go through to build up that credit with a secured credit card and then seamlessly transition into an unsecured card. It's an opportunity to take that first step toward building and growing their business and accessing the capital that they need to grow.

IM: How does this initiative target the inequality in access to capital for small business owners?

CR: Well, nine out of 10 of business owners are relying on their personal credit card when they're applying for financing. When we look at entrepreneurs of color, the rate of low credit score for them is two to three times higher for Black and LatinX entrepreneurs specifically. So for us, this is the importance of building in conjunction with our creating equitable access to credit program that is much broader, frankly, than the card itself, but offering the wraparound services around it, making sure that we are providing the secured to unsecured seamless transition plan.

We're also working with the First National Bank of Omaha, and the reason we selected them at the bank, they're the largest privately held bank in the country. This also gave us the flexibility to really look at alternative underwriting models and the the opportunity to learn through all of the insights that we're gaining around these small business owners. We're trying to figure out how do we start to look at some of these alternative data points and identify not just the financial history of a business owner.

There are a lot of circumstances that lead to poor credit scores, whether it was for a health circumstance that they endured or veteran business owners who may have no credit history because they've been overseas for a long period of time. We're looking at what are some of the data points that are indicating that a business owner is more likely to succeed and more likely to repay the credit that they've taken on. We know already through a lot of research and data points that having a business plan automatically makes you more likely to repay your your debt. Or the fact that you are getting positive feedback from mentors is a strong indicator that you're going to be more likely to pay off some of those debts. And so we're really looking at what are some of these things that may be overlooked but are frankly more indicative of who the business owner is and the potential for their for their business and their opportunities to be able to repay credit that they take off.

IM: What type of small business owners do you feel like this is a really good solution for? What all can they expect from the program?

CR: As a small business owner myself, I've created a card that I wish I would have had. When I started this company, I really looked at what was available to the market. This credit card, like many cards, offers benefits that are pretty standard in the market right now. Things like cash back, extra points, and kickers for certain spends that are relevant to small business owners. But again, we really looked at where are the gaps for these business owners and the things they don't already have or are unable to access.

What we discovered was there are lots of accelerators, programs, and workshops and things — but they're expensive. So, there's an opportunity here. We work with our network of partners that we have for Hello Alice that are traditionally paid or have a cost to roll them out and offer business owners points and earnings that can be spent toward that.

Mentorship, as you know, is a huge, huge barrier, particularly when we look at our new majority entrepreneurs, so all of our cardholders get access to one-on-one coaching for this card. And we've really focused on areas that are primary interest to them, things like business strategy, operations, and financing for their businesses.

And then the other important piece of this is leveraging our partner network. We have so many partners that we work with at Hello Alice, companies that are offering products and tools and services to small business owners. With this card, we're opening up additional discounts beyond what we've already negotiated standards for all of our community, whether it's an extra discount on things like QuickBooks, Salesforce, or different tools that they might be using. We have over 70 affiliate partners that we've already brought into the program working with more every week right now, which is really exciting.

We're also trying to find new opportunities — where can we bring the most benefit these business owners in a way that grows with their company and that, as they're spending and creating traction with their company, our team is working behind the scenes to unlock more and more opportunities every stage of that journey.

IM: Do you feel like this program is a response to the growing challenges small businesses have been facing over the past few years?

CR: I mean, our business certainly had a hell of a couple of years, and 89 percent of small business owners in our community, which is now over a million business owners strong, claim the access to capital is limiting their growth potential. Where we focus a majority of our energy as a company is unlocking those barriers.

As we dig into that, what we're seeing is access to capital — whether that's early days as a credit card or a grant funding, or later stage with loans or even venture capital — is that we need to address this by helping to unlock that journey for business owners, but also making sure that we're supporting them with the opportunities that are relevant to their own stage of growth.

The other piece is revenue generation. We always want to focus on the core and sustainable business health of a company and making sure that they're bringing in revenue and that they've created a business model that actually works and is scalable. We're working a lot on providing them not just money into their business or outside capital, but how do we actually help them generate revenue and clear capital in all the stages unless they have that capital? How do we actually help them deploy that capital in meaningful ways will help them grow their business?

All of the wraparound services that come with the core of what Hello Alice offers — and certainly with this credit card we're getting a deeper layer of insight, because we know more about the businesses, we know how they're spending, what they're doing. We're really learning about how do we additionally support this cohort of business owners with the right wraparound services, making sure that they're getting the right thing at the right time.

What's interesting is that and the reason we really started with the credit card is that 50 percent of small business owners have a personal credit score of 680 or better, and that's strong enough to apply for most business credit cards. However, that score locks them out of getting a business loan, which typically requires a score of 720 or better to qualify. So we're able to tap into a cohort and help them grow this pool of capital in the earliest stages. But really making sure that we're giving them the growth tools that ultimately free them up to go get that loan, to go walk into a main street bank and have that power of choice along their capital journey.

In general, we focus a lot on access to capital. We deployed over $37 million in small business grants to date, and we're continuing to grow that pool. We're actually working right now on an equitable access to capital fund, which will allow us to utilize those grants to actually pay the security deposit for select business owners who may not qualify for additional credit.

Ultimately, this is a really tangible way to work with financial institutions, MasterCard, and our broader partner ecosystem. We haven't seen the statistics move in decades. How do we actually open up more capital to business owners that otherwise wouldn't qualify for it? And this is our our first of many steps toward towards putting a really tangible stake in the ground.

IM: What about the challenges of the pandemic — how do you see COVID-19 and its shutdown affect small businesses?

CR: For us, like many businesses, I think the pandemic was it shook everything up. I think we had a plan and a path forward that always entailed unlocking access to capital and unlocking opportunity — that has never changed for us. But it accelerated a lot of things. We had planned to deploy grant funding in 2020 independent of the pandemic. When COVID hit and we saw these businesses struggling, we quickly pivoted. We accelerated that plan significantly. We started deploying grants within weeks of shelter in place — even before PPP had been announced and before businesses were accessing any government support. We were among the first to offer emergency grants and put us in a really strong position to grow that program and again to accelerate the rollout of that, which is now turned into a much larger program.

That really was, I would say, the acceleration of our entire early stage access to capital continuum. And what we learned from that was how much capital these business owners actually need. The process gave us a lot of information that that has really helped roll out the broader continuum of capital for us. We launched our lending marketplace with over 92 small business lenders all focused on fair and equitable funding, which is available over all as well. And so these credit cards round out that early stage access to capital.

But when we look at our new majority cohort — and even many white male businesses — we have to get business owners of all types that are struggling with access to capital. Everybody's willing to give money to business owners that have traction, that are doing well with their business, that are on a growth path. But it's very hard to get the traction that big investors need, and that's always really struggle.

The pandemic accelerated a lot in this space. It made us realize that the opportunity here is actually much greater to support these businesses and also got a lot of attention from partners. We've been having these conversations for years, frankly, prior to the pandemic. And everybody recognized there was an issue, but I don't think they realized the impact of the issue until COVID hit, and small businesses were the ones that kept operating and made sure that we were getting the resources that we needed to continue to live in a time when everything was a little bit uncertain.

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This conversation has been edited for brevity and clarity.

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Houston robotics co. closes series B after year of growth

money moves

Houston- and Boston-based Square Robot Inc. closed a series B round of funding last month.

The advanced submersible robotics company raised $13 million, according to Tracxn.com, and says it will put the funds toward international expansion.

"This Series B round, our largest to date, enables us to accelerate our growth plans and meet the surging global demand for our services,” David Lamont, CEO, said in a statement.

The company aims to establish a permanent presence in Europe and the Middle East and grow its delivery services to reach four more countries and one new continent in Q1 2025.

Additionally, Square Robot plans to release a new robot early next year. The robot is expected to be able to operate in extreme temperatures up to 60 C. The company will also introduce its first AI-enabled tools to improve data collection.

Square Robot launched its Houston office in 2019. Its autonomous, submersible robots are used for storage tank inspections and eliminate the need for humans to enter dangerous and toxic environments.

The company was one of the first group of finalists for the Houston Innovation Awards' Scaleup of the Year, which honors a Bayou City company that's seen impressive growth in 2024. Click here to read more about the company's growth.

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This article originally ran on EnergyCapital.

Show me the money: Top Houston innovation grant and gift news of 2024

year in review

Editor's note: As the year comes to a close, InnovationMap is looking back at the year's top stories in Houston innovation. Money means a lot to startups and other innovative entities, and while startups are usually scouting venture capital investors, grants and donations are key too. These are the most-read news articles about grants and gifts — be sure to click through to read the full story.

Rice researchers secure $35M federal grant to advance medical device technology

Rice’s Biotech Launch Pad will lead the effort to commercialize the device. Photo courtesy Rice University

Rice University has secured part of a nearly $35 million federal grant aimed at commercializing a bioelectric implant for treatment of type 2 diabetes and obesity.

The federal Advanced Research Projects Agency for Health awarded the $34.9 million grant to Rice and several other universities.

Rice’s Biotech Launch Pad will lead the effort to commercialize the self-contained, implantable Rx On-site Generation Using Electronics (ROGUE) device. ROGUE houses cells that are engineered to produce type 2 diabetes and obesity therapies in response to patients’ needs. Continue reading.

Houston health care institutions receive $22M to attract top recruits

The grants, which are between $2 million to $6 million each, are earmarked for recruitment of prominent researchers. Photo via Getty Images

Houston’s Baylor College of Medicine has received a total of $12 million in grants from the Cancer Prevention & Research Institute of Texas to attract two prominent researchers.

The two grants, which are $6 million each, are earmarked for recruitment of Thomas Milner and Radek Skoda. The Cancer Prevention & Research Institute of Texas (CPRIT) announced the grants May 14.

Milner, an expert in photomedicine for surgery and diagnostics, is a professor of surgery and biomedical engineering at the Beckman Laser Institute & Medical Clinic at the University of California, Irvine and the university’s Chao Family Comprehensive Cancer Center. Continue reading.

New report ranks Houston top market for life sciences

Houston lands in the No. 7 spot for growth in the granting of degrees in biological and biomedical sciences. Photo by Natalie Harms/InnovationMap

Thanks in large part to producing hundreds of college-trained professionals, Houston’s life sciences industry ranks among the top U.S. markets for talent in 2024.

In a report published by commercial real estate services company CBRE, Houston lands in the No. 7 spot for growth in the granting of degrees in biological and biomedical sciences. From 2017 to 2022, Houston notched a growth rate of 32.4 percent in this category.

In 2022, the University of Houston led the higher education pack in the region, graduating 746 people with a bachelor’s degree or above in biological or biomedical sciences, according to the report. Continue reading.

Texas organization grants $68.5M to Houston institutions for recruitment, research

Several Houston organizations have received millions from the Cancer Prevention and Research Institute of Texas. Photo via tmc.edu

Three prominent institutions in Houston will be able to snag a trio of high-profile cancer researchers thanks to $12 million in new funding from the Cancer Prevention and Research Institute of Texas.

The biggest recruitment award — $6 million — went to the University of Texas MD Anderson Center to lure researcher Xiling Shen away from the Terasaki Institute for Biomedical Innovation in Los Angeles.

Shen is chief scientific officer at the nonprofit Terasaki Institute. His lab there studies precision medicine, including treatments for cancer, from a “systems biology perspective.” Continue reading.

Houston health care institution secures $100M for expansion, shares renderings

Baylor College of Medicine's Lillie and Roy Cullen Tower is set to open in 2026. Rendering courtesy of SLAM Architecture

Baylor College of Medicine has collected $100 million toward its $150 million fundraising goal for the college’s planned Lillie and Roy Cullen Tower.

The $100 million in gifts include:

  • A total of $30 million from The Cullen Foundation, The Cullen Trust for Health Care, and The Cullen Trust for Higher Education.
  • $12 million from the DeBakey Medical Foundation
  • $10 million from the Huffington Foundation
  • More than $45 million from members of Baylor’s Board of Trustees and other community donors, including the M.D. Anderson Foundation, the Albert and Margaret Alkek Foundation, and The Elkins Foundation.

“The Cullen Trust for Health Care is very honored to support this building along with The Cullen Foundation and The Cullen Trust for Higher Education,” Cullen Geiselman Muse, chair of The Cullen Trust for Health Care, says in a news release. “We cannot wait to see what new beginnings will come from inside the Lillie and Roy Cullen Tower.” Continue reading.

TMC launches cancer-focused partnership with Japan

global collaboration

Houston's Texas Medical Center announced the launch of its new TMC Japan BioBridge and Japan-Accelerator Cancer Therapeutics and Medical Devices, or JACT, this month.

The strategic partnership between Japan-based Mitsui Fudosan Co. Ltd. and the National Cancer Center will focus on advancing cancer treatments and providing a pathway for Japanese innovators to expand in the U.S. market. A delegation from TMC recently visited Tokyo, and William F. McKeon, president and CEO of TMC, signed the TMC Japan BioBridge Memorandum of Understanding with Takeshi Ozane, general manager of Mitsui Fudosan, and Hitoshi Nakagama, president of the National Cancer Center of Japan.

“The launch of TMC Japan BioBridge is a vital step forward in connecting two global leaders in healthcare innovation,” McKeon says in a statement. “Japan’s leadership has demonstrated an impressive commitment to advance medical cures and life sciences technologies and through this partnership, we are opening necessary doors for Japanese researchers and innovators to access the US market and collaborate with our TMC ecosystem. Together, we aim to accelerate critical breakthroughs to make a difference for patients all around the world.”

The new JACT will offer cancer-treatment companies a structured process to prepare for a U.S. expansion and will allow for meetings with pharmaceutical companies, hospital systems and investors and provide insights on U.S. regulatory approvals. It'll focus on three key areas, according to the statement:

  1. Milestone development and financial planning
  2. Clinical and regulatory expertise
  3. Strategic partnerships and market insights

“This TMC Japan BioBridge and JACT Program will enable us to promote the advancement of start-up companies aiming to commercialize innovative medical technologies originating in Japan into the U.S." Nakagama says in a statement. "We also hope this collaboration will not be limited to our (Japan Agency for Medical Research and Development)-supported project, but will lead to further cooperation between TMC, NCC, and other Japanese institutions in various fields.”

This is the sixth international strategic partnership for the TMC. It launched its first BioBridge, which focus on partnerships to support international healthcare companies preparing for U.S. expansion, with the Health Informatics Society of Australia in 2016. It also has BioBridge partnerships with the Netherlands, Ireland, Denmark and the United Kingdom.