Renauld Laplanche, CEO of Lending Club, announced today that Lending Club and Union Bank will partner to develop and offer products to the 1 million customers of Union Bank. Lending Club has partnered with several smaller banks in the 12 to 18 months. Laplanche sees great potential for more of the 6,000 banks in the US to partner with the p2p lending industry and profit from leaner processes the new players offer.
Source: Lending Club
Renauld Laplanche speaking at LendIt 2014
Asked whether Lending Club has plans to go international he says the focus is on the US. But the time may come for international expansion but that is at least 2-3 years of.
Prosper raises a 70 million US$ funding round led by Francisco Partners. The additional funding will be used for growth and expansion plans. David Golob from Francisco Partners, global private equity firm which focuses on information technology, will join the Prosper Marketplace Board of Directors. The funding round also includes investments from Institutional Venture Partners (IVP), one of the premier later-stage venture capital and growth equity firms, as well as Phenomen Ventures. Continue reading →
Lending Club announced today that it has acquired Springstone Financial for a total consideration of 140 million US$ in cash and stock. Springstone provides financing options for consumers looking to finance private education and elective medical procedures through a network of over 14,000 schools and healthcare providers.
“The acquisition of Springstone is significantly expanding the services we offer to help consumers achieve their goals,” said Lending Club CEO Renaud Laplanche. “Parents looking to finance their children’s education and patients undergoing elective procedures will now have access to Lending Club loans and benefit from responsible, transparent and affordable financing options.”
Mike Gilroy, CEO of Springstone, said, “Lending Club has established a great reputation as an innovator. We’ve built strong bridges between providers and patients and between educational institutions and parents. We’re excited to become part of the Lending Club platform, which will bring new financing options to our network.”
As part of the financing of this transaction, Lending Club also announced the closing of an equity capital raise. Investors in the $65 million round included funds and accounts managed by T. Rowe Price Associates, Inc., Wellington Management Company, LLP, BlackRock and Sands Capital. According to Peter Renton the valuation of Lending Club at this round is at 3.76 million US$.
“We believe that Lending Club has an opportunity to transform an important part of the banking system into a transparent online marketplace,” said Henry Ellenbogen, Portfolio Manager at T. Rowe Price Associates, Inc. “The Springstone acquisition is another step in that direction, and we are very excited at the prospect of being a long term equity partner of Lending Club.”
Lending Club also raised $50 million in debt financing to fund the acquisition.
March brought growth for the major p2p lending services. Ratesetter managed to pass Zopa and Funding Circle in newly originated loan volume in the UK. I added one new service to the table. Note that I have switched the reporting currency to Euro as all but two services are located in Europe. Several p2p lending services reached major figures for total loan volume funded since inception:
I do monitor development of p2p lending figures for many markets. Since I already have most of the data on file I can publish statistics on the monthly loan originations for selected p2p lending services.
Table: P2P Lending Volumes in March 2014. Source: own research Note that volumes have been converted from local currency to Euro for the sake of comparison. Some figures are estimates/approximations.
Notice to p2p lending services not listed: If you want to be included in this chart in future, please email the following figures on the first working day of a month: total loan volume originated since inception, loan volume originated in previous month, number of loans originated in previous month, average nominal interest rate of loans originated in previous month.
A huge step for Lending Club. Yesterday they launched loans to businesses. Lending Club business loans will range from 15,000 US$ to 100,000 US$ initially, with plans to increase to 300,000 US$ in the future. The loans carry fixed interest rates starting at 5.9% with terms of one to five years and no prepayment penalties. While Lending Club already offered loans that were used for “business purposes” in the past, these were actually consumer loans – the borrower was an individual rather than a company. Obviously the application process and the evaluation of creditworthyness needed to be redesigned for this type of loans.
This will have a big impact on the p2p lending market in the US. It vastly increase the potential market size and will enlarge the choice of loans that investors can lend to.
In the UK 7 innovative finance companies have joined forces and launched the Alternativebusinessfunding.co.uk website to inform SMEs what alternative funding methods they offer. Two p2p lending services Zopa and Funding Circle, two p2p equity (crowdinvesting) services Crowdcube and Seedrs as well as three other services Pension-Led Funding, Platform Black and MarketInvoice participate in this non-bank funders collaberation. These platforms account for 85% of alternative finance for businesses market and have provided more than 580 million GBP to SMEs between them. Screenshot
The information website works like this: 1. Enter the amount of funding you require. 2. After each question you will see the lights change dependant on which funder suits your criteria. 3. At the final question click on any green (or amber) traffic lights for your preferred funder details. 4. All that is left now is for you to approach your funder of choice about sourcing SME finance.
