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P2P Lending Marketplace Bondora Fuels European Expansion Plans

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Bondora LogoP2P lending service Bondora, headquartered in Tallinn, announced that they raised 5M US$ Series A round led by Valinor Management to fuel further expansion plans for cross-border lending in Europe. Richard Fay and Ragnar Meitern also invested. Bondora was the first p2p lending service doing cross-border lending for retail investors. Bondora is currently facilitating loans to borrowers in Estonia, Spain, Finland and Slovakia from investors in all European countries. Bondora states that investments on the marketplace have consistently yielded premium returns to investors while simultaneously delivering competitive rates to borrowers through efficiency and lower interest rate spread.

Uniting European markets under the roof of a single platform creates a huge opportunity given the size of the population in the continent and the volume of outstanding debt. Thus, Eurozone countries alone account for 340 million people and EUR 1.1 trillion in outstanding consumer credit debt, a market equivalent to US. Lending to borrowers in markets that are independently relatively small (even Germany, the largest economy in Europe is only approximately twice the size of California in terms of GDP) allows earning premium returns due to lack of competition among traditional lenders.

Pärtel Tomberg, CEO and co-founder of Bondora, said he hoped the cash infusion from Valinor Management, the hedge fund run by David Gallo, will allow his company to build the more complex infrastructure needed to make more cross-border loans. ‘The goal is really to become a global market,’ Pärtel Tomberg said in an interview. ‘There are no precedents in the world on many of the things we want to do.’

The company also wants to attract institutional lenders from the US.

A possible mid-term competitor might be Lending Club. But Lending Club said in the investor conference call on Tuesday that they will focus on the US market and will not use the capital raised in their December IPO on international expansion plans in the near future. Renauld Laplanche is however monitoring international developments in the market: ‘We’ll see what model is really the winning model in any particular geography.’ Continue reading →

LendingRobot Raises 3M from Runa Capital

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Seattle based Lending Robot, a 3rd party tool for investors to automate bidding on Lending Club and Prosper has raised 3 million US$ form Moscow based VC Runa Capital. The founders Gilad Golan and Emmanuel Marot had initially created a solution to automate their own investments on Lending Club. The growing needs to automate such investments convinced them to develop this further in the publicly available service Lending Robot. Lending Robot is free for the first 10K managed investment and beyond that charges users a small yearly fee. To comply with regulation, Lending Robot registered with SEC as an Investment Advisor.

The main advantage of the service is that it bids for investors a high speed. This is crucial because bidding on Prosper and Lending Club is very competitive and the most sought loans are filled very fast.

Crowdcube Raises 1.2M from the Crowd and 3.8M from Balderton Capital

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Today British crowdinvestment platform Crowdcube started pitching the crowd to raise 1.2 million GBP. This was on the same terms as the 3.8 million GBP it raises from Balderton Capital in this series B funding. The total raised is for 25.64% equity. This puts the valuation at about 19.5 million GBP. The pitch was funded  in a record 16 minutes by 142 investors. There was a minimum investment threshold of 1,000 GBP (and a maximum of 25K GBP) in this round.

Crowdcube launched in 2011 and has raised over 30 million GBP for more than 130 start-up, early stage and growth businesses. More than half of this finance has been secured in the first half of 2014. Crowdcube also succeeded to sign up international partners and now has a presence in seven countries: Brazil, Sweden, Dubai, Poland, Italy, Spain and New Zealand. I feel that Crowdcube has done tremendously well in terms of product development and building its market position.

Darren Westlake, CEO of Crowdcube commented: ‘We’re delighted to secure growth finance from such a renowned VC who will undoubtedly add tremendous value both strategically and operationally. We’ve built a pioneering and award-winning service over the last few years. This investment, alongside the crowd, puts us in an even stronger position to provide essential growth finance for businesses and inspire a new generation of investors.’

This round follows earlier rounds, where Crowdcube raised 320K GBP in Dec. 2011 (I invested a small amount during that round) and 1.5M GBP last year prompting Techcrunch to rightly state ‘Let no one accuse Crowdcube of not eating its own dog food‘. However I would expect a crowdinvestment platform to be a stellar role model in communication with its own investors and I feel there is lots of room for improvement there (especially when compared to some other equity crowdfunding pitches I invested in) as frequence and content of information provided has been sparse and I found the answers to my direct email queries to Crowdcube directors unsatisfying.

German P2P Lending Service Auxmoney Raises 16M US$ Series B

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German p2p lending service Auxmoney completed a 16M US$ series B round, financed by Foundation Capital, joined by Partech Ventures and Scott Bommer, alongside existing backers Index Ventures and Union Square Venture. Index Ventures and Union Squre Ventures already invested in the Series A in the end of 2012.

Auxmoney was founded in 2007, and has originated 94.4 million EUR in p2p loans since.

The proceeds will be used for auxmoney’s ambitious expansion plans, by further enhancing the Düsseldorf-based lending and investment platform and expanding the company’s 60-strong team.

auxmoney CEO and co-founder Raffael Johnen said the investment marked a tipping-point for peer-to-peer lending in Germany, with the market set to go mainstream. “We are about to witness a major shift in consumer behaviour towards peer-to-peer loans. As clear market leader in Germany, auxmoney is right at the forefront of this development,” he said. “With our new partners on board, we are ready to turn crowdlending into an integral and mainstream element of Germany’s consumer finance landscape.”

Prosper Raises 70M

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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 →