4 essential presentations on marketplace lending

best presentations for marketplace lending

Marketplace lending is rapidly evolving. From its startup roots, the industry is maturing along the lines of other robust lending industries: that is to say, the volumes of originations are ramping and securitizations — the packaging of pools of marketplace loans into securities and selling them off to institutional investors — are underway.

Interested in learning more about the industry? Tradestreaming has compiled an A-list of some of the best presentations and slideshares on marketplace lending. From the beginner to the advanced, these marketplace lending presentations have something to offer everyone.

Marketplace Lending: Evolution of an asset class

Author: Ron Suber (President of Prosper)

Prosper was a pioneer in the US in peer to peer loans. The model has changed as institutional capital has been injected into the industry, but it’s also meant that the industry has grown up a bit. Ron Suber, Prosper’s President, has been a major player in the maturation process that’s seen the industry grow from nothing in 2006 to an expected $122 billion in origination by 2020. Suber’s presentation, delivered at the LendIt Conference, does a great job describing where marketplace lending came from and where Suber and Prosper believe it’s headed.

A trillion dollar market by the people, for the people

By: Charles Moldow (Foundation Capital)

Charles Moldow, of Foundation Capital, is considered one of the most influential investors in the marketplace lending space (you can hear an interview Tradestreaming conducted with Moldow). In fact, he’s credited with coming up with the new name for the industry — marketplace lending — replacing P2P lending, which is how the industry began. In this presentation, Moldow, who was an early investor in Lending Club, lays out the early thesis behind investing in the industry and shows the revenue production possible if marketplace lending is successful in just capturing a small percentage of lending business from the banks. Indeed, he believes that marketplace lending can grow to be a trillion dollar industry.

Transforming the banking system into an online marketplace

By: Renaud Laplanche (Lending Club founder, CEO)

As Lending Club became the first consumer marketplace lender to hit public markets, its CEO and founder, Renaud Laplanche has become kind of a de-facto spokesperson for the industry. This presentation, delivered at the 2014 LendIt conference focuses on how the banking industry hasn’t enjoyed many of the same efficiency gains other industries saw in the era of the internet. Laplanche demonstrates how marketplace lending can replace some of the core functions of the banking sector, and in doing so, provide a solid product to market participants and make a lot of money.

Why marketplace lending is better

By: Samir Desai (Funding Circle)

While the other presentations have focused on consumer lending on marketplace lending platforms, Funding Circle’s founder, Samir Desai’s video, from Lending Europe 2015, describes his firm’s opportunity in SMB lending. Funding Circle is the leader in this type of marketplace lending globally. This video delves into not just what marketplace lending is, but why it can be seen as better than traditional models. Desai describes how his platform matches supply and demand and how a marketplace lender should be fundamentally less risky than a traditional balance sheet lender.

 

 

5 trends we’re watching this week

5 trends in finance this week

[alert type=yellow ]Every week at Tradestreaming, we’re tracking and analyzing the top trends impacting the finance industry. The following is a list of important things going on we think are worth paying attention to. For more in depth trendfollowing, subscribe to Tradestreaming’s newsletters .[/alert]

  1. How Payoff is shifting the conversation about consumer debt to financial wellness (Tradestreaming): Payoff seems to be genuinely interested in helping its clients find their way out of debt and start saving. Pretty weird for a company that extends credit.
  2. Banks should take fintech seriously, not panic, but make a gameplan (McKinsey): A new McKinsey report hit the wires this week – it’s a sanguine analysis meant for finance professionals. “Specifically, this means that banks should be less preoccupied with individual fintech attackers and more focused on what these attackers represent—and build or buy the capabilities that matter for a digital future.” Worth a read.
  3. J.P. Morgan acquires nearly $1 billion worth of LendingClub loans — Sources (Nasdaq): J.P. Morgan has agreed to acquire nearly $1 billion worth of personal loans arranged by LendingClub, according to people familiar.
  4. Why one of the best fintech investors, Foundation Capital’s Charles Moldow, invests only in B2C (Tradestreaming): Foundation has one of the strongest fintech portfolios and General Partner, Charles Moldow (LendingClub, OnDeck Capital, Envestnet, Motif Investing) explains why he sees so much more room to run in disrupting finance.
  5. Quicken Loans getting into personal loans (Detroit Free Press): Quicken this week launched RocketLoans, an online service offering cash loans of $2,000 to $35,000 to prospective borrowers with good credit scores and financial histories. The loans have fixed terms of three to five years and carry interest rates ranging from just over 5% to the low or mid-teens.

[podcast] Why Foundation Capital’s Charles Moldow invests in B2C fintech companies

charles moldow investing in fintech
Charles Moldow, Foundation Capital
Charles Moldow, Foundation Capital

Last week, we had Caribou Honig of QED Investors on the podcast and I said that his portfolio is one of the strongest in fintech. If I had to name the top investors in the next generation of finance companies, Charles Moldow of Foundation Capital  would definitely be near the top of the list, as well. Charles joins us this week on the Tradestreaming Podcast to talk about his thesis behind why he likes to invest in a trillion dollar industry that, in his words, “doesn’t do a great job servicing its customer base”.

His white paper, A Trillion Dollar Market By the People, For the People is essential reading for anyone who wants to know about the marketplace lending space:  its size, structure, and potential. We’ll include a link in the show notes to it. His current portfolio includes auxmoney, BTCJam, Finxera (formerly Bancbox), LendingClub [IPO 12/11/14], Lending Home, Motif Investing, and On Deck Capital [IPO 12/17/14].

I think you’ll find my conversation with Charles to be thought-provoking — pay attention to why he prefers to build standalone B2C finance companies as opposed to firms that partner and sell into incumbent financial institutions. Contrarian and a very interesting point.

Listen to the FULL episode

In this episode, Charles shares:

  • his thesis on why he likes to invest in early stage fintech
  • why fintech has been relatively off the radar screen for many venture capitalists
  • his preference building B2C companies in the financial services space and why B2B firms have a hard go at it
  • how his white paper changed how we view peer to peer lending by renaming it the marketplace lending industry
  • why he turned down investing in Lending Club when he first met them in 2009 and why pulled the trigger in 2010 and invested
  • the struggles of matching supply and demand for a consumer financial marketplace
  • the challenges originally faced by OnDeck Capital and how the company solved them
  • the opportunity to market to millennials and the challenge the generation (with rising debt and weak wages) poses for financial firms
  • his view on the heating up of valuations in the fintech space
  • his firm’s interest in insurance and why it could be an exciting, investable space

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