LendUp


LendUp is a financial technology company that provides payday loans and installment loans, as well as financial education, access to credit reporting and gamification for responsible lending behavior.[1][2] The company also issued credit cards through its LendUp Card Services division, which ultimately became Mission Lane LLC.[3] The company is licensed as a payday lender in 24 states.[4]

LendUp
TypePrivate
IndustryConsumer Finance
Founded2012
Founders
  • Sasha Orloff
  • Jake Rosenberg (CTO)
HeadquartersSan Francisco, California
Area served
Nationwide
Key people
  • Anu Shultes (CEO)
  • Bill Donnelly (CFO)
  • Vijesh Iyer (COO)
  • Nigel Morris (Board Chair)
Productspayday loans; installment loans
Number of employees
approx. 250 (Q3, 2018)
Websitewww.lendup.com

Founders

LendUp's co-founders are step brothers Sasha Orloff and Jake Rosenberg. Through school and early jobs they went separate ways. Orloff worked in consumer credit and then venture capital at Grameen Bank, World Bank and Citi. Following an internship at 16, Rosenberg became Yahoo! employee #80 and stayed for more than a decade, before joining Zynga as a platform CTO at 29. In the summer of 2011 Orloff asked Rosenberg to join him to found LendUp. They sought to solve problems with the financial services industry, which Rosenberg claimed could be solved through technology.[5][6]

Funding and board advisors

LendUp graduated out of the Y Combinator batch of 2012.[7] It has received $325 million in equity and debt financing from PayPal,[8] Kleiner Perkins Caufield & Byers, Google Ventures, Andreessen Horowitz, Alexis Ohanian and QED among others.[1][9][10][11][12]

In August, 2016 LendUp announced its Series C round of equity, led by Y Combinator.[13] In March 2017, LendUp announced it received a $100 million credit facility from Victory Park Capital and surpassed $1 billion in loan originations.[14]

Nigel Morris, co-founder of Capital One and QED Investors, serves as LendUp's Board Chair.[15] Other Board members include QED co-founder Frank Rotman, an early Capital One Financial Corp. executive and its long-time chief credit officer, and Blake Byers of GV.[16]Board advisors include Carrie Dolan, Ali Rowghani, and others.[17][18]

History

Like other payday loan companies, LendUp loans to customers that banks usually decline,[19] giving borrowers with poor credit scores access to credit cards and short term loans.[20] Many of the loans offered by the company are advertised as an alternative to payday loans for customers, but carry interest rates comparable to other payday lenders.[21] LendUp's two Visa cards are issued by TAB Bank and Beneficial State Bank. They feature longer-than-usual grace periods before late fees kick in, and interest rates range from about 20 to 30 percent on credit lines up to $2,000. The card business is growing more quickly than the firm's lending product.[15] LendUp has called its customers “the emerging middle class.”[22] Its customers generally have credit scores below 680.[10]

In September 2016, LendUp was fined by the Consumer Financial Protection Bureau for charging illegal fees, miscalculating interest rates and failing to report information to credit bureaus.[23]:533 The company agreed to pay $6.3 million in penalties and customer repayments.[24][21][25][26]

In May 2017, LendUp announced plans to quadruple the number of credit cards available to consumers through its partnership with Beneficial State Bank.[27][28] As of May 2018, the company had surpassed this goal.[16]

In June 2017, LendUp and the Aspen Institute Financial Security Program launched Finance Forward, alongside Mayor Stephen K Benjamin of Columbia, SC. Finance Forward is a multi-city event series that brings together elected officials, businesses, community advocates and nonprofit leaders to identify and advance actionable solutions to the growing problem of income volatility in the U.S.[29][30]

In November, 2017, the company announced that former Tesla executive William Donnelly joined as CFO.[31]

In January 2019, Anu Shultes was named CEO, replacing Orloff.[32]

References
  1. Gannes, Liz. "Kleiner Perkins, Andreessen Horowitz and Google Ventures Fund Payday Loan Alternative LendUp". October 10, 2012. All Things D. Retrieved 6 August 2013.
  2. Brancaccio, David (October 11, 2012). "The online game of borrowing money". Marketplace.
  3. "LendUp Card Services has transitioned to Mission Lane LLC". Mission Lane LLC. Retrieved 2020-03-09.
  4. "Rates & Notices". LendUp. Retrieved 2020-03-09.
  5. Blackwell, John Reid (September 2, 2017). "Online lending firm LendUp sees growth opportunity in Richmond area". Richmond Times-Dispatch. Retrieved 2018-09-16.
  6. Terzo, Gerelyn (July 25, 2017). "PayPal & LendUp Bridge Financial Inclusion Gap". deBanked. Retrieved 2018-09-16.
  7. "Winter 2012 Companies (YC W12) | Y Combinator Universe". ycuniverse.com. Retrieved 2018-04-22.
  8. Lawler, Ryan. "LendUp gets strategic investment from PayPal and adds to its executive team". Techcrunch. Retrieved 2018-09-18.
  9. "LendUp Closes $100M Credit Facility | PYMNTS.com". www.pymnts.com. Retrieved 2017-03-04.
  10. Constine, Josh (January 22, 2016). "LendUp Scores $150M For A Credit Card That Won't Screw You Over". Techcrunch. Archived from the original on 2016-01-22. Retrieved 2018-09-16.
  11. Rudegeair, Peter (May 14, 2018). "Former Citigroup CEO Vikram Pandit Makes $100 Million Investment in Credit-Card Startup". Wall Street Journal. Retrieved 2018-09-16.
  12. Rao, Leena. "LendUp Raises Cash From Kleiner Perkins, Andreessen Horowitz, Google Ventures And Others To Disrupt Payday Loans". Techcrunch. Retrieved 2018-09-16.
  13. Rudegeair, Peter; Demos, Telis (2016-08-23). "Silicon Valley Lender Raises Nearly $50 Million for Subprime Credit-Card Push". Wall Street Journal. ISSN 0099-9660. Retrieved 2017-03-04.
  14. "LendUp Closes Another $100 Million Credit Facility & Surpasses $1 Billion In Loan Originations". Retrieved 2017-03-04.
  15. Verhage, Julie and Surane, Jennifer (June 21, 2018). "Capital One Co-Founder Is Making a Bet on Risky Borrowers". Bloomberg Business Journal. Retrieved 2018-09-16.CS1 maint: multiple names: authors list (link)
  16. Mark Calvey (June 21, 2018). "San Francisco fintech LendUp adds star power to boardroom". San Francisco Business Times. Retrieved 2018-09-16.
  17. "Jake Rosenberg of LendUp with Ali Rowghani". Y Combinator YouTube channel. January 31, 2018. Retrieved 2018-09-16.
  18. Mark Calvey (June 28, 2017). "LendUp picks up PayPal as investor, Carrie Dolan as adviser". San Francisco Business Times. Retrieved 2018-09-16.
  19. Farr, Christina. "LendUp Uses 'Big Data' to Bring Better Small Dollar Loans To People In Need Better". October 10, 2012. VentureBeat. Retrieved 6 August 2013.
  20. Empson, Rip (21 June 2013). "Aiming To Disrupt Payday Lending, a16z-Backed LendUp Now Offers Instant Online And Mobile Loans". Techcrunch. Retrieved 8 January 2016.
  21. Jayakumar, Amrita (30 September 2016). "Payday loan alternative LendUp to pay $6.3 million for misleading customers". The Christian Science Monitor. Retrieved 11 July 2018.
  22. "Exclusive: S.F. fintech raises $100 million for subprime lending". www.bizjournals.com. Retrieved 2018-04-22.
  23. Van Loo, Rory (2018-07-01). "Technology Regulation by Default: Platforms, Privacy, and the CFPB". Georgetown Law Technology Review. 2 (2): 531.
  24. "CFPB Orders LendUp to Pay $3.63 Million for Failing to Deliver Promised Benefits". Consumer Financial Protection Bureau. Retrieved 2020-07-19.
  25. Wall Street Journal (September 28, 2016). "Lender ordered to pay total $6.3 million over payday-loan and installment-lending violations".
  26. Koren, James Rufus (2016-09-27). "Google-backed LendUp fined by regulators over payday lending practices". Los Angeles Times. Retrieved 2020-07-19.
  27. "LendUp launches a better credit card for people looking to improve their credit – TechCrunch". techcrunch.com. Archived from the original on 2013-06-23. Retrieved 2018-04-22.
  28. "LendUp Gives the Underbanked What No Traditional Bank Will - Finovate". Finovate. 2017-05-17. Retrieved 2018-04-22.
  29. "LendUp Finance Forward Cash Advance Lends Hand | PYMNTS.com". www.pymnts.com. Retrieved 2018-04-22.
  30. "A Conversation with Lendup's CEO Sasha Orloff and Vice President Jotaka Eaddy". The Financial Revolutionist. Retrieved 2018-04-22.
  31. Wack, Kevin (November 7, 2017). "Former Tesla VP joins consumer lending startup". American Banker. Retrieved 2018-04-22.
  32. Stone, Todd. "LendUp Gets a Shake-up". deBanked. Retrieved 2020-07-21.
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