Small business loan facilitator, Lendio, has secured $20 million in a financing round led by investment from Comcast Ventures and Stereo Capital; Dave Zilberman of Comcast Ventures will be joining the firm's board of directors following the financing round; the firm seeks to partner with small business lenders in order to help them find the best loan provider for their needs; they currently partner with approximately 75 loan providers; in the third quarter they helped facilitate $63 million in loans for small businesses, an increase of 93% from the third quarter of 2015. Source
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Sub-prime lender Elevate, while still awaiting the right time to go public, has expanded their product line by offering customers a line of credit for up to $3,500 called Elastic; Republic Bank is the issuer of the credit line and according to Elevate's CEO, Ken Rees, there are other institutions showing interest; Rees explains further, "Banks are terrible at lending outside of their branch footprint and they are not good at customer acquisition. We provide products and a set of underwriting tools that fits for non-prime customers." Source
DirectMoney, an online lender in Australia, has received institutional funding to help it continue originating loans for the next 12-24 months; the funding follows the appointment of new CEO, Anthony Nantes on October 5; full terms of the deal and details on the institutional partnership were not disclosed by the source and appear to be available only to the platform's shareholders. Source
A development agency for the Scottish government, Scottish Enterprise, and its investment arm, the Scottish Investment Bank (SIB), have agreed to fund loans on the LendingCrowd platform; they will invest up to £2.75 million in Scottish small-to-midsized businesses, acting in parallel to the retail investors on the platform; the Scottish government earlier identified SMEs needing financing up to £150,000 as an economic development priority. Source
Intuit has partnered with BlueVine to make credit more easily available for its QuickBooks users; the partnership will allow small businesses using QuickBooks to obtain credit lines of up to $100,000; BlueVine will add a line of credit product offering to the borrowing options on QuickBooks which currently also include loans from Lending Club, OnDeck and Funding Circle. Source
Venture capital investment in marketplace lending is slowing as firms are struggling to become profitable; in 2015 venture capitalists invested $5.2 billion in 132 marketplace lending deals; in 2016 that total is down to $2.2 billion and 65 deals, according to a report from PitchBook Data; Moody's has also reported on a lack of profitability in the sector; with a key focus on achieving profitability it seems there are a few themes that will be important to watch in the industry including investor channels, unified methodology, capital usage, partnerships to increase demand and more reliance on institutional cash. Source
PeerStreet announced that they have crossed $150 million in originations after one year in business; the company launched at Money 20/20 last October; so far the platform has experienced zero losses, providing returns between 6% and 12%; PeerStreet's weighted portfolio loan-to-value is 65%. Source
Stress testing from Funding Circle has reported its loan platform would still provide investors with a net return of 6.4% given a worst case market scenario; while effects from Brexit continue to be debated, market skeptics are not as optimistic as the UK platforms; they foresee stagflation in the UK characterized by higher unemployment and slowing GDP growth; they are also concerned about a lack of skin in the game which has prompted parliament member, Chris Philp, to request from the Financial Conduct Authority that a portion of each firm's loans include balance sheet capital; while marketplace lending executives are against this approach, policy makers are considering it. Source
In a speech at the Money 20/20 conference in Las Vegas, the head of the CFPB said he was troubled by banks who would shut off access to third-party data providers and believes consumers should have access to their data; though the agency declined to comment on the possibility of a new rule, they did make it clear that consumers should be the ones who decide when and who should have access to their data; this puts banks in a tough position as they work to comply with the current regulations and burgeoning fintech market that has given consumers a variety of technology options to use their personal data. Source
The big data technology provider raised the round from MissionOG with follow on investment from Notion Capital and Singtel Innov8; they intend to use the new funds to grow their technology and client services teams also expanding partnerships to keep up with demand from the US and Asia; DemystData provides financial institutions with a big data tech platform to make improved risk and compliance decisions. Source