A few weeks ago I attended a credit group meeting that I help manage with a NACM affiliate. Like many credit groups, we gather 2-3 times a year to discuss a list of submitted customer accounts from the various members. Meetings for these offline professional social networks follow a straightforward process. The accounts are grouped together in a spreadsheet so that each member can see their most recent trade with a specific customer as well as others in the credit group. The group leader then moves through the accounts and discussion ensues, as necessary, covering a range of insights. The process is remarkably efficient and more importantly, the information shared is unlikely to ever show up on a credit report – which is really the whole reason such credit groups exist.

What made this particular meeting standout for me was that for the first time in memory, there were a handful of new members that had never been to this credit group (or any other) before. When a curious but slightly timid newcomer was tapped to discuss one of his accounts first, he requested “Can someone else go first? I’ve never been to one of these – I want to learn how it works.” It was a reminder to veterans that while this may be an essential part of how they do their job, the process of sharing such information – and the realization of resulting benefits – is something that needs to be experienced to be fully understood. Following the meeting, a 30-year veteran of the group recalled his initial experience and why he’s remained committed to collective information sharing throughout his career. Put simply, he felt like it was his duty to pass along his knowledge, techniques and even his network to the next generation, just as the previous generation had done the same for him. And he credited the group and extended network of contacts it has created with an ongoing ability to perform his job at a superior level.

And therein lies the key to such networks — why members remain so committed. Credit and collections decisions are a year-round effort. On the one hand, such meetings provide a period, invaluable opportunity to gain insights that simply don’t show up on a standard business credit report. But equally if not more importantly, they offer the opportunity to broaden a network of peers who can provide similar insight on a when-needed basis.

Given such the added benefits at a time when so many businesses are looking to reduce risks and improve cash flow, we want to know: Are you seeing an uptick in membership and participation in your credit groups? Are you joining new ones? Do you find yourself tapping into such networks more often? We’d love to hear from you. How are you leveraging your credit network?

Last week I received an email from a customer asking a simple question.

“How do we go about contributing credit information about companies? If we run into problems with a customer, we would want the market to know what problems with payment we had.”

The standard and historic answer that most credit bureaus like Cortera would give is this:

“Please send us a cut of your monthly accounts receivables information according to our standard format and we’ll incorporate it into our database.”

This is the way it has always been. Sounds simple enough – right? Well, it is not. For most companies this task requires some kind of technical expertise to get that information out of their accounting system and into a format that a bureau can ingest and then report back on a credit report. Plus, this can take weeks by the time the request has been made to IT and then the information actually shows up on a credit report. In the mean time the debtor could continue to be granted credit without the greater market having any knowledge of their payment problems. Obviously we are talking about reporting on customers that are well past due and are not likely to be a customer again – in common terms we are talking about deadbeats.

Of course my answer is different now.

My response back:

“We just launched a new free website that makes reporting on a specific company and telling the market about them very easy. You can go to Cortera’s community ratings website and from there you can search for the business that is giving you trouble and use the “Rate Company” tab to provide your payment experience and comments.”

Within 5 minutes he was able to report on the two customers that were giving him trouble.

Have a few customer (or should I say ex-customer) deadbeats in your portfolio? Tell the world about yours and who knows you must just catch one reported by another member before you get in too deep.

Jim and Alex on stage demoing the Cortera Credit Exchange at DEMOfall 09.

Join the Cortera Credit Exchange at www.cortera.com.

eWEEK Interviews Cortera at DEMOfall 2009

Jim Rapoza, eWeek

We’ve had a great couple of days here at DEMOfall 09 and the feedback from the blogging and Twitter community has been equally positive.  Here is a sampling of posts from Twitter from the last 48 hours:

• parand Cortera looks like a company that might actually make that … what’s it called? Oh yeah – money. #demo09

• orenmazor iiinteresting. like a useful BBB? http://www.cortera.com

• shawkeith Cortera reminds me of eBay rating system, but for small businesses on whether they are good at paying bills. #demo09

• mystratex Current #DEMO09 myStratex Index Top 5:Enthusem,Point of Wealth,Emo Labs,Cortera and Freeddom.Check http://bit.ly/myStratexBlog for details.

• DunnMich Cortera launches first community for small business credit reporting at DEMOfall 09 | Cortera – http://shar.es/12xSQ

• Rafe Cortera up next at #Demo09. Dull, like I said this AM, but really really smart. http://bit.ly/MOHqi

• laurabeck Agree! RT @acoolong: Cortera helps SMBs build credit/manage credit risk. Who cares if not sexy? It’s SMART & addresses REAL NEED #demo09

• maryrduan cortera credit exchange is going to be extremely useful for the smb space. yelp meets fico meets mint. #demo09

• mystratex DEMOfall 09 myStratex Index for Cortera is 33. Check http://bit.ly/myStratexBlog for details. #DEMO09

• lizasperling Cortera’s value – see what community is saying about you may be more valuable than actual ‘’score”- big market #DEMO09

• acoolong Cortera helps SMBs build credit and manage credit risk. Who cares if it’s not sexy? It’s SMART and addresses a REAL NEED. #demo09

• lizasperling Cortera called dull, but looks pretty compelling. Small businesses need these tools. #DEMO09

• ScottKirsner One of the companies (re)launching at Demo09 today is Cortera, a reincarnation of eCredit, once a dot-com darling: http://bit.ly/zsh44

• attribyte Tiny Cortera swings for Dun & Bradstreet (cnet.com/2 links) http://slnk.us/caVVt7

Read them all here:  http://twitter.com/#search?q=cortera

Follow us at www.twitter.com/Cortera

As we blogged about a few weeks back, big businesses are taking longer to pay their small business suppliers while in turn expecting payment from these same partners much faster. As a result, while America’s largest companies extricate themselves from the recent credit crunch, most small companies continue to feel the pinch. Much of this is, of course, due to the power that these industry giants wield over their smaller counterparts.  But we believe that a large part of the pain can be directly traced back to an antiquated commercial credit system that is stacked against the little guy.

With yesterday’s launch, we are excited by the passion and general enthusiasm from the business community.  Here is some feedback we’ve heard so far:

Wall Street Journal – Venture Capital Dispatch

“The company likens itself to a business-to-business version of Yelp.com. Given the plethora of user generated feedback about consumer products available on the Internet, it was only natural for important things, like the credit risk of a potential customer, be vetted in a more open community.”

- Scott Denne, Venture Capital Dispatch / Wall Street Journal

CNET

“I think I just found the dullest company at Demo 09 to write about. But you know how these things go: Often it’s the block-and-tacklers that find huge success while the science-fiction dreamers end up manning ski lifts.”

- Rafe Needleman, CNET

Credit.com

“Last year, a friend called me asking for advice. Her coaching and consulting firm was stiffed for a couple grand by another business. The firm that didn’t pay her for her services was located across the country, so there was a good chance that any money she spent trying to collect would be a matter of throwing good money after bad. “Can’t I report them to the credit bureaus?” she asked. “Probably not,” was my response. The credit reporting agencies are set up to collect large volumes of information from established clients, not one-time reports like hers.

Today, my answer to her would be different.

That’s because Cortera, a community-driven business information company, has unveiled the Cortera Credit Exchange, a new online service that, for the first time, blends business credit report data with user generated payment experience reviews and ratings from companies’ business partners.”

- Gerri Detweiler, credit expert and co-author of Business Credit Success

eWeek

“The second batch of products were focused on payment systems, and the one that was of the most interest to me was one that another tech writer called the most boring product at DEMOfall. Cortera is another service that seems to fill a void for business today, especially small businesses. Cortera provides credit information on businesses large and small but then combines it with ratings from a community of small business owners, who provide feedback both good and bad on these businesses. So, for example, if a company has a habit of not paying suppliers or paying very late, a new catering business looking to provide services to the negligent company can then either choose to not do business with the deadbeat company or make sure they negotiate upfront payments.”

Jim Rapoza, eWeek

Boston.com

“Cortera aims to be a kind of “wisdom of the crowds”-driven business credit agency. CEO Jim Swift likes to describe it as “Yelp for business credit.” And in the same way that the user-powered review site Yelp has taken on established players like Zagat, Cortera has Dun & Bradstreet in its sights.”

Scott Kirsner, Boston.com

VentureBeat

“Cortera is significant because payments between small companies are crucial to their businesses, so it’s important to track them, and identify untrustworthy partners. And traditional credit reports represent deals from less than 1 percent of businesses in the US, Cortera says.”

Anthony Ha, VentureBeat

What a great day at DEMOfall 09! Today, we unveiled a fundamentally new approach to commercial credit reports by adding the real-time voice of the business community. Are you a small business owner? A finance manager at a Fortune 500 company? Or a veteran credit pro at a company somewhere in between? The Cortera Credit Exchange might just be the information solution you’ve been looking for.

Credit Decisions are Now Social

Join the first community dedicated to making the flow of business credit information as free and widely available than ever before. We’ve taken a basic commercial credit report, put it online for free, and then made it social, creating the first website where you can share your customer payment experience with other decision makers. Just like the many consumer and business online communities you’ve come to rely on every day, you can join for free, glean insight from user reviews, and even write a few of your own.

Harness the Power of Thousands of Credit Professionals

The Cortera Credit Exchange brings together the collective wisdom of the commercial credit community. In a few clicks, you can join Cortera and get ratings from your peers–giving your direct access to the type of information you’ve always wanted. The community brings online what already is being used daily in conference rooms, on the phone and over lunch. You’ll find timely reviews on businesses of all sizes, and you can even add your own review to provide your unique insights.

What’s the Catch?

There is no catch. We believe strongly that the commercial credit reporting system is currently broken and can be improved through the flow of free and drastically lower priced premium information. Want a traditional credit report? We have those too, just at price that might surprise you. Need corporate family information, business scoring on many businesses or business demographic information? We’ve got you covered.

The basic credit report information and community is free to use. It’s that simple.

Join the Community Today – It’s Free

Leverage the collective experiences of credit professionals, business executives, and owners like you to make better decisions. Getting started is easy and won’t cost you a thing—all you have to do is register.

Tell us what you think. We’d love to hear from you.

It’s official. We are excited to announce the first community-driven approach to commercial credit reporting. Business decision makers from small business owners to senior executives of large corporations can now leverage the collective insights of the entire credit community. Using familiar ratings and reviews features popularized on sites like Yelp, Amazon, and TripAdvisor, members can share payment experiences with other credit pros and business owners by writing their own reviews, while utilizing the knowledge of their peers when making credit decisions by reading reviews submitted by other users.

Our goal is to fill an information gap we’ve heard about since our founding over 15 years ago: business credit reports – used to determine credit viability and payment terms – are based on the financial transactions of less than 1% of US businesses. Over 50% of the US GDP is provided by companies that have little or no voice in how they are perceived in traditional credit reports – small businesses found on Main Street in every town in the country. In what amounts to a calculated compromise, these reports are often derived from interactions with only the largest businesses. The majority of interactions with small businesses are often ignored. It’s the all-too-often lost insights contained within those millions of experiences that Cortera aims to recapture by embracing a more social approach.

With this new solution we are simply revitalizing an approach that had been in place since the 1800s – local merchants exchanging trade references in communities throughout the country. And that’s the key. The Cortera Credit Exchange is a community platform, designed to take these traditionally offline communities and peer networks that have long contributed knowledge and experience for the greater good and bring them online — a technological evolution of one of the oldest and most trusted social networks in business history.

Our mission is straightforward. It is time for business decisions and control over the granting of credit that powers over 50% of US GDP to be returned to those that have been left behind: small businesses.

• Read the official press release here
• Watch us live at DEMO here
• Give it a try for yourself here

We are excited to announce that Cortera will be launching our latest innovation next week at DEMOfall ’09.  Read the official announcement here.

Stay tuned to our blog for more big announcements and follow us on Twitter for live tweets right from the show floor.