Peer-to-peer lending marketplace Lending Club is announcing new funding and an acquisition this morning. The company raised $65 million from T. Rowe Price Associates, Inc., Wellington Management Company, LLP, BlackRock and Sands Capital, and $50 million in debt. And Lending Club acquired financing company Springstone Financial for $140 million in cash and stock.
Springstone provides affordable financing options for consumers looking to finance private education and elective medical procedures through a network of over 14,000 schools and healthcare providers.
“The acquisition of Springstone is significantly expanding the services we offer to help consumers achieve their goals,” said Lending Club CEO Renaud Laplanche in a statement. “Parents looking to finance their children’s education and patients undergoing elective procedures will now have access to Lending Club loans and benefit from responsible, transparent and affordable financing options.”
Lending Club brings together lenders and borrowers who want to cut out banks in the process of investing among peers, has facilitated a total of $3.8 billion in consumer loans, and is growing at a pace of over $750 million a quarter. And the company has more than doubled annual loan volume each year since launching in 2007. The company also recently expanded into business loans.
The addition of financing to the Lending Club portfolio seems to be one more step in the direction of the company’s evolution into the modern day bank. As more traditional banks neglect the needs of much of the population in both business and personal finance, the alternative lending space is heating up, more players are growing fast and investors are placing their bets. And if traditional banks are smart, many of these companies could be interesting acquisition targets. But Lending Club has long been seen as an IPO hopeful, so perhaps we’ll see a public offering from the company in the not to distant future.
We’ll find out more when Laplanche takes the stage at Disrupt NY in May.