Peer-to-peer lending aggregator changing direction

By Ryan Weeks on 4th May 2017

P2P/Marketplace LendingAlternative Credit

LendingWell pivots business model, makes redundancies.

Peer-to-peer lending aggregator changing direction

LendingWell, a business which facilitates investment into a range of peer-to-peer lenders, is in a period of transition, and is overhauling its team.

After initially setting up shop as a kind of P2P supermarket, LendingWell moved to launch a bond for wealth managers earlier this year.

But founder and CEO Tim Slesinger admitted to being a few months late on that front, with rival firm Goji launching a bond of its own in late March.

Slesinger also said that an excess of investor cash in the P2P market has been creating a lot of drag on performance lately, and that he therefore deemed a pivot back to LendingWell’s technology-oriented roots to be the best course of action.

The firm has thus made a number of redundancies over the past few months, and will be recruiting a new team from scratch. 

“At every stage of the journey towards launching LendingWell, we have had not only to respond to the ever-changing legislative landscape and the effect that has on our partner platforms, but also to gauge the views of our key customers,” said Slesinger. 

“As a start-up, I believe that it has been essential to maintain the ability to pivot our business model in response to what we have learnt along the way. As such, LendingWell is currently working to build a team that is more tech focused in order to build a portal connecting investors with passive direct-lending opportunities globally.”

Slesinger tells us that he has seen interest from potential partners (lending platforms) across the US, South America and Australia, in addition to the firm’s UK partners.

He also says that the firm still has a “good chunk” of investment capital and “supportive shareholders”, and seems optimistic about the new direction of the business.

Peer-to-peer lending is often described as a disintermediated industry – in that it connects borrowers and investors directly. Attempts to reintermediate that process are yet to meet with much success.

InvestUP, another P2P aggregator, has been dormant since the summer of last year, according to Companies House filings. InvestUP’s former founder and CEO James Tuckett next worked as head of product at LendingWell until leaving the firm in April, seemingly among those made redundant. 

Comments

Brian Petersen

26 Jul 2017 12:45am

I cant see any aggregator being able to take more than about 15bp out of a P2P trade so any business is looking at £1bn + in volume to get off ground. Some task right?

AG

08 May 2017 04:34pm

The industry's matured sufficiently in my view for there to be scope for an intermediated service and I think Goji's so far demonstrated that to an extent. I think the FCA needs to be more supportive with clearer guidelines and more stability in terms of policy for the industry to thrive.

Companies in this Article:

Goji
LendingWell