On Thursday morning, the New York Stock Exchange debuted its newest member from Silicon Valley, Lending Club (LC). The Marketplace lending FinTech firm came roaring onto the scene with a share price of $24.75, that's 65% higher than the $15/share price it had announced the night before. During its initial public offering, LC offered 58 million shares at $15, raising $870 million with an estimated valuation of $5 billion or more. Out of the 58 million shares 50,300,000 are offered by LC, while the remainder are being made available by selling stockholders.
LC has been in business for seven years and is the leader in marketplace lending, having funded $6.2 billion in loans and setting the pace for other FinTech companies in the online lending space, a $3 trillion industry. According to LC, the company has successfully paid upwards of $600 million in interest back to their investors, which equates to a return on investment of approximately 8.5%.
“We’ve been building lots of safeguards to ensure there is a great experience for all types of investors, including retail investors. The institutional investors we have at Lending Club are not credit hedgefunds–they’re long-term, patient investors: pension funds, insurance companies, endowments, foundations,” expressed Renaud Laplanche (CEO of LC).
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Here at Patch of Land, we want to congratulate LC for their tremendous success with their IPO. As we all watch with anticipation, we are happy to see marketplace lending and FinTech receive the recognition it rightly deserves. With other marketplace lending companies such as OnDeck Capital and SoFi preparing for their own IPO, it will be interesting to see what the future holds for the online lending industry as a whole.
What are your thoughts on Lending Club's IPO? How do you foresee the outlook of marketplace lending? Please leave a comment with your thoughts and let us know.