King: High e-commerce financing rates reflect astronomical underlying startup failure risks
Ed King · Rich People Are the Best Evangelists in the World - Here Is Why · Apr 1, 2025 · at 35:33
Ed King, Chief Strategy Officer at Startups.com, explains why capital providers charge high rates for e-commerce loans despite having ample capital and deal flow.
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“The unit economics are really tough in financing e-commerce, and that's the reason these interest rates, like even you look at PayPal, like PayPal's got oodles of money. They're sitting on bags and bags, a war chest of money that they could be empowering. All these e-commerce entrepreneurs, they got the deal flow, they got the market, yet look at the interest rates that they charge. Why? They have to, because the failure rates are that high. The risk is Astronomical.”
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