Brian Zwerner of Kensington Blake Capital Commentary on Marketplace Lender Distribution

Partnerships

April 26, 2015

Kensington Blake Capital’s Managing Principal Brian Zwerner has observed the significant growth of

lenders with marketplace business models and believes this growth will continue. The marketplace

lending community is finding ways to create partnerships with key players in the consumer and business

world and with each other. These partnerships will be a key source of growth in the coming years.

Lending Club is the largest marketplace lender in the U.S. and the only one to complete a public stock

offering thus far. They recently announced a significant partnership deal with Alibaba, the giant e-

commerce company in China. This partnership will allow U.S. consumers and small businesses to

finance the purchase of goods through Alibaba’s online market from manufacturers in China. This

should provide significant loan opportunities for Lending Club to grow their portfolio.

Another interesting partnership recently announce was between two marketplace lenders with differing

strategies. Prosper is the second largest consumer marketplace lender, trailing only Lending Club in

volume. They recently teamed up on what appears to be a cross referral basis with OnDeck Capital, a

leading small business lender that recently completed its own stock offering.

Investors at this point can participate in the marketplace lending market by purchasing loans on a

number of different platforms. These can be consumer loans from companies like Lending Club or

Prosper, or small business loans from Funding Circle or others. Investors can also buy into the growth in

the sector by purchasing the stock of Lending Club or OnDeck. Other marketplace lenders are sure to go

public and be available for broader investor purchase soon. Funding Circle recently completed a

$150MM private equity sale, so a public offering is likely not too far off. At Kensington Blake Capital, we

view this as an important sector for investors and will continue to provide commentary as the market

evolves.

Commentary by Brian Zwerner, Managing Principal, Kensington Blake Capital, LLC.

www.kensingtonblakecapital.com

Please see recent article in Bloomberg News on Lending Club’s partnership with Alibaba

http://www.bloomberg.com/news/articles/2015-02-03/alibaba-picks-lendingclub-as-finance-partner-

after-bank-of-china

Please see press release below on partnership between Prosper and OnDeck Capital

http://www.prnewswire.com/news-releases/prosper-marketplace-and-ondeck-announce-strategic-

partnership-300065272.html