Mar 02, 2026 in Research
Investment Partner
Access to affordable, long-term capital remains one of the most persistent constraints facing small businesses in the United States. There are approximately 36 million small businesses, representing roughly 43 percent of US GDP, yet small-balance credit remains structurally underserved. Small businesses face an estimated $350 billion annual funding shortfall, underscoring the scale of the opportunity.
The SBA 7(a) loan program accounts for approximately $37 billion in annual originations, yet the market remains fragmented and operationally complex, particularly for loans under $500,000. After reviewing the data, a clear paradox emerges: a program designed to support small businesses does not consistently serve the smallest borrowers to the extent it could. A disproportionate share of volume flows toward larger loan sizes, where lender unit economics are more attractive. Originating small-balance loans is a fundamentally difficult technological and operational problem that requires automation, standardized workflows, and cost-efficient underwriting infrastructure that traditional banks have struggled to build. As a result, banks often lack the cost structure to profitably serve this segment, while larger SBA specialists concentrate on large-balance loans, leaving a structural gap in the core small business market.
NEWITY was purpose-built to solve this problem.
Rebuilding the SBA Stack
NEWITY is building an end-to-end fintech platform that enables banks to efficiently originate, underwrite, fund, and service small-balance loans at scale. The company embeds with partner banks under a lender service provider model while operating a proprietary origination engine supported by roughly 50 integrations and direct SBA connectivity. Automated KYC and KYB, bank data parsing, and AI-driven underwriting workflows standardize credit evaluation, materially improve throughput, and reduce cycle times, transforming a historically manual process into a scalable system capable of supporting attractive small-balance unit economics.
The core SBA 7(a) platform focuses on loans of $350,000 or less and is deeply integrated with Northeast Bank, the #1 ranked SBA lender by unit approvals in fiscal year 2025, reflecting a uniquely aligned and high-performing relationship. At the same time, NEWITY is expanding its network beyond Northeast, leveraging its technology-driven origination model to serve additional bank partners. The company drives average loan sizes of approximately $113,000, well below typical industry averages, underscoring its focus on a segment that requires automation to deliver attractive unit economics. To date, the company has helped more than 125,000 small businesses secure approximately $12 billion in SBA funding while materially reducing funding timelines relative to national averages.
In September 2025, NEWITY launched its Growth Term Loan, a 10-year non-SBA product designed for a similar borrower base but with faster time to funding and risk-based pricing. The product originated more than $20 million in October 2025 shortly after launch and has continued its rapid growth. This expands the addressable market beyond SBA eligibility while supporting diversified fee, servicing, and gain-on-sale revenue streams.
A Founder-Led Platform Out of Chicago
NEWITY is headquartered in Chicago, and we are excited to support the continued growth of the Chicago-based fintech and credit ecosystem. The company’s location reflects its deep alignment with banking and credit markets and positions it within a strong regional financial network.
Co-CEO David Cody brings more than 30 years of experience across asset management, business development, and capital formation, including time at Fortress. Fellow Co-CEO Luke LaHaie built the platform from the PPP era into today’s scaled SBA and Growth Term Loan infrastructure and leads product and daily operations. Together, they have built a profitable and growing platform in just four years while continuing to expand automation and product breadth.
Multiple Vectors for Expansion
We believe there are several credible avenues to further expansion. Replicating the Northeast Bank playbook across additional regional banks could expand the lender service provider footprint and multiply origination volume. Deeper integrations with core banking providers can broaden distribution across a larger bank base. Scaling the Growth Term Loan through offtake partnerships with credit unions, credit funds, and insurance capital can diversify funding and accelerate growth alongside the SBA loan business.
In parallel, NEWITY is building toward a more structural evolution of small business credit by embedding blockchain infrastructure into its capital markets strategy. The company is developing onchain origination capabilities that create clear data provenance at the loan level, enhancing transparency, auditability, and investor confidence. Its early partnership with the Canton Network positions NEWITY at the forefront of institutional-grade tokenized finance, with the long-term prospect of enabling a permissionless offtake market for standardized small business loans.
By standardizing loan assets and recording key data onchain, NEWITY aims to reduce friction in secondary sales, expand the universe of potential buyers, and unlock capital that has historically remained siloed in private credit markets. Over time, we believe transparent, interoperable credit infrastructure will become increasingly important as private markets modernize, and NEWITY is proactively building toward that future.
NEWITY combines an experienced and execution-oriented team, clear product market fit, attractive unit economics, and exposure to a large and fragmented market. The business is already cash flow positive within a durable SBA framework while layering in differentiated blockchain-enabled capital markets capabilities. We invested because NEWITY is not only scaling small-balance small business lending in the United States but also building the infrastructure that could modernize how this asset class is originated, distributed, and financed.
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