Prosper has completed a $165 million Series D financing round led by Credit Suisse NEXT Investors, part of Credit Suisse Asset Management.
Additional investors include J.P Morgan Asset Management, SunTrust Banks, a subsidiary of USAA, BBVA Ventures (BBVA’s representative office in San Francisco), Neuberger Berman Private Equity Funds, Passport Capital, Breyer Capital and others.
“This investment is a testament to the efforts of our entire team in changing how people experience access to credit. The explosion of interest in P2P lending demonstrates that a shift is in progress in the way that consumers borrow and lend. This new funding will help us scale the business to meet this growing awareness and demand.”
The funding will be used to help the platform continue with its expansion of development of a national brand as it continues to build new products for both borrowers and investors.
Vic Pascucci III, head of corporate development at USAA, added:
“USAA invests in companies and start-ups to combine the best of external innovation with the best of internal innovation to serve USAA’s members and mission. As the nation’s first peer-to-peer lending service, Prosper has pioneered a new model that makes it simpler to get an unsecured loan. Prosper’s digital capabilities and peer-to-peer lending services are just the kind of innovation we look for in an investment.”
Jim Breyer, returning investor, Founder/CEO of Breyer Capital and Partner at Accel Partners, explained:
“The accelerating growth of peer-to-peer lending demonstrates that there is a compelling opportunity to disrupt traditional models by improving the experience and enhancing value for people all around the world on both sides of the borrowing and lending equation. The talented team at Prosper has done a tremendous job of creating a trusted and recognized brand, and we are excited to continue supporting the company as it enters its next phase of growth.”
Interestingly, Nasdaq.com has reported that Aaron Vermut said that Prosper would consider using the funds raised for acquisitions but has no imminent plans to go public. This quells rumours that the platform will be following in the footsteps of OnDeck and Lending Club.
It has been reported that this funding round values Prosper at $1.9 billion. This is a big jump from May last year when after a $70m funding round the company was said to be valued at about $600m. For comparison, after floating last year, Lending Club now trades at a market value of about $7 billion.
Prosper has just completed a record quarter, with nearly $600 million in loans originated through the platform, up 200% from the year ago quarter.
The platform has now originated an impressive $3 billion in loans. Especially considering that the platform only reached the $2 billion milestone at the end of October last year.
"Our industry globally is reaching escape velocity....and the proof is in the numbers. It took Prosper 8 years to achieve $1 billion in aggregate loans .....six month to reach the second $1 billion and less to reach the third $1 billion. This is a testament to the borrower experience, quality of the product and Tons of EAU."
However, in the UK we are still waiting to see which platform will be the first to reach the £1 billion lending mark. AltFi Data has taken a look and challenged the assumption that Zopa, the oldest P2P lender, will be the first to hit this mark. We will be watching closely to see how the UK market develops and to see if it can catch up with the extremely strong growth in the US.
AltFi is returning to Amsterdam for its second annual Summit in the city. The inaugural event last year was a roaring success, with key figures from across Continental Europe's alternative finance and digital banking sectors highlighted. These included Jeroen Broekema, managing director of Funding Circle Netherlands, and Mieke van Engelen, head of innovative partnerships at ABN AMRO's standalone lending platform, New10.