Lending Club


Lending Club

Infobox_Company
company_
company_name = LendingClub.com
company_type = Private
foundation = 2006
key_people = Renaud Laplanche, CEO
industry = Personal finance, Software
location = Sunnyvale, California
products = person-to-person lending
revenue = N/A
num_employees = 21
homepage = [http://www.lendingclub.com/ lendingclub.com]

Lending Club - Lending Club is a person-to-person lending website that pairs borrowers and lenders through a matching system [LendingClub.com - How It Works http://www.lendingclub.com/info/how-it-works.action . Retrieved (12-28-2007)] [cite web|accessdate=2008-04-07|url=http://abcnews.go.com/Business/story?id=4549802&page=1|title=Social Lending Networks, New Alternative to Banks |publisher=ABC News|date=2008-04-05|author=Marquez, Laura ] that combines a search algorithm, credit decisioning and social networking [Chu, Kathy. USA Today. (12-25-2007) http://www.usatoday.com/money/perfi/credit/2007-12-25-peerlending-pers_N.htm. Retrieved (12-28-2007)] . Lending Club is headquartered in Sunnyvale, California. In August 2007 the company raised $10.26 Million in a Series A funding round led by Norwest Venture Partners and Canaan Partners [Gonzalez, Nick. [TechCrunch] . (8-22-2007) http://www.techcrunch.com/2007/08/22/lendingclub-to-close-1026-million-series-a/ Retrieved (12-28-2007)] .

Social Lending

Lending Club was founded on the philosophy that borrowers will be less likely to default to members of their own communities. Lending Club leverages existing communities and relationships to help minimize risk using a proprietary algorithm (LendingMatch) [http://www.lendingclub.com/info/how-it-works.action - How It Works. Retrieved (12-28-2007).] . Lending Club can find relationships between anonymous borrowers and lenders based on factors including geographic location, educational and professional background, and connectedness within a given social network. [Wolfe, Daniel. American Banker. (12-6-2007) http://blog.lendingclub.com/images/7920.pdf Retrieved (12-28-2007)]

Loan Performance Statistics

Performance statistics on Lending Club loans are published and updated weekly [http://www.lendingclub.com/info/statistics.action - Loan Performance Statistics. Retrieved (12-28-2007)] . The top 100 Lender portfolios are also listed on the company website [https://secure.lendingclub.com/lender-ranking.action - Top 100 Lender Portfolios. Retrieved (12-28-2007)] .

How It Works

Borrowers

Borrowers create loan listings by supplying details about themselves and the loans being requested. Lending Club obtains a credit report about the borrower in order to score the loan and assign the appropriate credit grade (A-G) and interest rate [http://www.lendingclub.com/info/rates-and-fees.action - Rates and Fees. Retrieved 12-28-2007] . Factors taken into consideration include the borrower’s credit score, credit history, the amount of the loan being requested and the borrower’s debt-to-income ratio.

Lenders

Lenders enter in personal information including their level of risk tolerance and then either search for loans themselves or use the LendingMatch algorithm to generate a recommended portfolio that takes their risk level and connections with borrowers into account. Lenders must supply at least $500 in loan money to take advantage of the LendingMatch algorithm. [http://www.lendingclub.com/info/about-lending.action - About Lending. Retrieved (12-28-2007)]

SEC Registration

As of April 8th 2008, Lending Club has suspended new lender registration, canceled its affiliate program and entered a "quiet period" while it awaits approval to issue promissory notes to lenders. [http://www.lendingclub.com/info/quietPeriod.action - Quiet Period. Retrieved (4-8-2008)]

On June 20, 2008, Lending Club filed an S-1 statement [http://www.sec.gov/Archives/edgar/data/1409970/000089161808000318/f41480orsv1.htm - Lending Club S-1 Filing PDF. Retrieved (7-3-2008)] with the SEC seeking the registration of $600 million in "Member Payment Dependent Notes" to be issued on its Web site. [http://www.techcrunch.com/2008/06/20/lending-club-files-for-sec-registration-hopes-to-resume-service - Techcrunch. Lending Club Files For SEC Registration. Retrieved (7-3-2008)]

On August 1st, 2008, Lending Club filed an amendment to its Form S-1 [http://www.sec.gov/Archives/edgar/data/1409970/000095013408013885/f41480a1sv1za.htm - Lending Club S-1 Amendment No. 1. Retrieved (8-6-2008)] outlining new interest rate formulas as well as more details on a "resale trading system" [http://www.doughroller.net/p2p-lending/lendingclub-changes-how-it-sets-interest-rates/ - Lending Club Files Amended S-1. Retrieved (8-6-2008)]

References

External links

* [http://www.lendingclub.com Official Site] LendingClub.com
* [http://blog.lendingclub.com Company Blog] Lending Club Blog


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