Transforming the banking system into an online marketplace

Invest

PaymentsBorrowers

Investors

U.S. Securities and Exchange Commission (SEC)

crowd sourcing investments is legal

Problem

is it safe?

5 problems borrowers face:• Applications are denied

• Interest rates can be really high

• Loan payments can be expensive

• Hidden fees and penalties

• Calls to much

Benefit for borrowers

is a great option

5 decisions for borrowers:• Easy online application

• Low fixed rates

• Fixed monthly payments and flexible terms

• No hidden fees and prepayment penalties

• Friendly service

Benefit for investors

and efficiency

5 decisions for investors:• Returns to high

• Simple and straightforward

• Portfolio analysis

• Loan analysis

• Auto sell feature

How its work

peer-to-peer lending

Borrowers get fundedInvestors build a portfolio

Borrowers apply for loansInvestors open an account

Borrowers repay automatically

Investors earn & reinvest

Advantage

Operating expenses as % of outstanding loan

balance

Source McKinsey & Company

Competitions

Sources: Liberum “P2P Lending: Opportunity & how to invest” March 2014

Market

Sources: Liberum “P2P Lending: Opportunity & how to invest” March 2014

Positioning

Sources: Foundation Capital 2014

Business model Lender Lender Lender

BorrowerWeb bank

Notes, providing for payments equal to monthly payments received by Lending Club

from borrower, net of 1% service charge

Purchase price of Notes, designed to fund a selected member loan

Monthly payments of principal and interest on

corresponding member loan

Funding of selected corresponding member loan

Loan proceeds

Corresponding member loan promissory note

Non-recourse assignment of corresponding member loan

promissory note

Traction

Sources: Financial Report LendingClub Q1 2014

Forecast

Source: McKinsey & Company

Source: Wall Street Journal “Billion-Dollar Startup Club” January 2014

Risks

Kondratieff waves

• Borrower defaults

• Bankruptcy

• Interest rate risk

• Poor loan diversification

• Liquidity risk

• Government protection

Founded: October 1, 2006

Founders: Renaud Laplanche CEO; Carrie Dolan, CFO; Scott Sanborn, COO; John J. Mack, Director, Mary Meeker, Soul Htite

Headquarters: San Francisco, CA

Funding: $392.2M

Revenue: $98M (2013)

Categories: Finance Technology, Personal Finance, Finance

Employes: 379

Competitors: Prosper, Zidisha, Zopa, Funding Circle, Ratesetter, Kabbage

Partners: UnionBank, BlackRock, T. Rowe Price, Sands Capital Ventures, Google Capital, DST Global, Foundation Capital

Overview

Banks, hedge funds push into peer-to-peer lending

www.lendingclub.com

By Viktor Osetrov25/06/2014