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Prosper Pulls in $165 Million in Funding, Boosting Valuation to $1.9 Billion

By Julie Muhn (@julieschicktanz) Posted on April 10, 2015
Categories: Funding, Prosper

P2P lending company Prosper brought in $165 million in Series D financing yesterday. This doubles the company’s valuation to $1.9 billion, and classifies it as a fintech unicorn—a private company worth more than $1 billion.

The investment was led by Credit Suisse NEXT. Investors also include financial institutions and venture capital firms:

USAA
SunTrust Bank
J.P. Morgan Asset Management
BBVA
Neuberger Berman Private Equity Funds
Passport Capital
Breyer Capital

Founded in 2006, Prosper raised its first round of funding in 2005 to the tune of $7.5 million. Prior to this week’s installment, the company’s funding totaled $190 million; the San Francisco-based company’s funding now totals $355 million.

Three of the financial institutions that furnished the financing, USAA, BBVA, and SunTrust, are in talks with Prosper to co-brand loans for their customers. The company’s competitor, Lending Club, has been co-branding loans with Union Bank since May 2014 and with Bank Alliance community bank members since February 2015.

Prosper facilitated $1.6 billion in loan origination in 2014. This is four times what it did the year prior and more than half of its total $3 billion since launching in 2006.

Prosper plans to use the funding to expand beyond debt consolidation loans into healthcare lending.

Competitor Lending Club went public last December with an IPO that initially valued it around $8 billion. Its current market cap is $6.9 billion. Lending Club has issued $7.6 billion in consumer loans since launching in 2006.

While both companies are similar, Prosper is working hard to differentiate itself. The company, which offers unsecured consumer loans ranging from $2,000 to $35,000, states it has no intent to enter small-business lending. Meanwhile, competitor Lending Club launched its small-business segment, which enables companies to borrow up to $300,000, in March of 2014. According to American Banker, instead of extending financing to small businesses, Prosper plans to focus on finding a partner to help it expand into South America or Asia.

Prosper last demonstrated at FinovateSpring 2009 in San Francisco.

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Fintech Fundings: 16 Companies Raise $470 Million Week Ending April 10

By Jim Bruene Posted on April 10, 2015
Categories: Funding

The second quarter is off to a big start as charter Finovate alum Prosper raised $165 million at a valuation near $2 billion. In comparison, recently public competitor Lending Club is currently trading at a $6.8 billion valuation. Finovate alums Zen Payroll ($60 million), PayNearMe ($14.7 million) and Patch of Land ($23.6 million) also brought in 8-figure rounds. In addition, two Finovate alums were acquired: Authentify by Early Warning and SaveUp by a single investor. All told, Finovate alums attracted more than $260 million in VC funding, our alumni’s best week ever (excluding IPOs).

In total, 16 fintech companies raised $467 million. That’s the fourth biggest week (excluding IPOs) since we began tracking in August.

Here are the fundings from 5 April through 10 April 2015 in order of size:

Prosper
Consumer marketplace lender
HQ: San Francisco, California
Latest round: $165 million Series D; $1.9 billion valuation
Total raised: $355 million
Tags: Lending, credit, peer-to-peer consumer loans, investing, Finovate charter alum
Source: Finovate

Qufenqi
Chinese marketplace with purchases made on installment plan
HQ: Bejing, China
Latest round: $100 million Series D
Total raised: $125 million
Tags: Installment lending, credit, underwriting, ecommerce, payments
Source: Crunchbase

ZenPayroll
Online payroll management
HQ: San Francisco, California
Latest round: $60 million Series B; $550 million valuation
Total raised: $86.1 million
Tags: SMB, human resources management, payroll, payments, Finovate alum
Source: Finovate

WealthSimple

DIY wealth management using ETFs

HQ: Toronto, Ontario, Canada
Latest round: $30 million

Total raised: $31.9 million

Tags: Wealth management, investing, roboadviser, Toronto, Canada

Source: Crunchbase

MobiQwik

Indian mobile wallet
HQ: New Delhi, India
Latest round: $25 million Series B
Total raised: $30 million
Tags: Payments, mobile, wallet
Source: TechCrunch

Patch of Land
Crowdfunding real estate
HQ: Los Angeles, California
Latest round: $23.6 million Series A
Total raised: $24.9 million
Tags: P2P lending, peer-to-peer credit, real estate, investing, mortgage, Finovate alum
Source: Finovate

PayNearMe
Risk management for P2P lending
HQ: Sunnyvale, California
Latest round: $14.7 million Series F
Total raised: $71.2 million
Tags: Payments, underbanked, cash, Finovate alum
Source: Crunchbase

AssetAvenue
Commercial real estate marketplace lender
HQ: Los Angeles, California
Latest round: $11 million Series A
Total raised: $14 million
Tags: Commercial property, mortgage, lending, credit, underwriting, investing
Source: FT Partners

RealtyShares
Real estate marketplace lender
HQ: San Francisco, California
Latest round: $10 million Series A
Total raised: $11.9 million
Tags: Lending, real estate, mortgage, credit, crowdfunding, P2P, investing
Source: Crunchbase

Dealstruck
Lending marketplace for small business
HQ: Carlsbad, California
Latest round: $8.3 million Series A
Total raised: $9.5 million
Tags: Lending, SMB, underwriting, credit, Finovate alum
Source: Finovate

ApplePie Capital
Crowdfunding for the franchise industry
HQ: San Francisco, California
Latest round: $6 million Series A
Total raised: $11.8 million
Tags: P2P lending, SMB, peer-to-peer, underwriting, credit, investing
Source: FT Partners

PeerIQ
Risk management for P2P lending
HQ: New York City
Latest round: $6 million Seed
Total raised: $6 million
Tags: Marketplace lending, enterprise, peer-to-peer lending, underwriting, risk management
Source: Crunchbase

Estimize
Aggregates stock analyst forecasts
HQ: New York City
Latest round: $3 million Series B
Total raised: $5.6 million
Tags: Investing, research, analysts, Wall Street
Source: Crunchbase

Crowd2Fund
Small business marketplace lender
HQ: California
Latest round: $3 million Series A
Total raised: $3 million
Tags: P2P, SMB, lending, debt, equity, underwriting, investing
Source: The Paypers

Praesidio
Cybersecurity for the banking industry
HQ: Seattle, Washington
Latest round: $1.7 million Seed
Total raised: $1.7 million
Tags: Security, fraud protection
Source: Crunchbase

Elorus
Greek online invoicing platform
HQ: Greece
Latest round: $55,000 Seed
Total raised: $55,000
Tags: Accounting, billing, accounts receivables
Source: Crunchbase

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Finovate Alumni News

By Julie Muhn (@julieschicktanz) Posted on April 10, 2015
Categories: Avoka, Digital Insight, Linqto, MX, Onovative, Prosper

On Finovate.com

Prosper Pulls in $165 Million in Funding, Boosting Valuation to $1.9 Billion

Around the web

Digital Insight releases Android smartwatch functionality with Wright-Patt Credit Union.

Australian Banking Finance features Avoka CEO Derek Corcoran.

Louisville business blog features Onovative. Catch them at FinovateSpring 12/13 May 2015.

MX releases first look at its AppleWatch.

Linqto’s Personal Banker receives Overall Most Innovative Award in Barlow Research Associates’ 2015 Monarch Awards for in business banking.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

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FinovateSpring 2015 Sneak Peek: Part 2

By David Penn Posted on April 9, 2015
Categories: Bento for Business, DoubleNet Pay, FinovateSpring 2015, FinovateSpring 2015 Sneak Peek, Karmic Labs, SizeUp, Stratos, TickerTags, Trulioo, Uncategorized

FinovateSpring 2015 is just over a month away. Our annual spring conference returns to San Jose, 12/13 May for two days of live demos of the latest in fintech innovation.

Today we introduce you to another seven companies that will be on stage presenting their technical solutions to some of the financial community’s biggest challenges—from improving engagement through mobile and social channels to improving security and reducing friction for business and individual consumers.

Be sure to check out Part 1 of our Sneak Peek series featuring Alpha Payments Cloud, CUneXus, DRAFT, FundAmerica, SayPay, StockViews, and TrueAccord, as well.

Tickets are going fast. Register today and save your spot at our second Finovate show in San Jose.

Bento for Business provides financial solutions that fit small businesses, combining the security of a bank with the ease and convenience of a modern technology company.

Features:

The Bento Prepaid Commercial MasterCard provides small business owners with controls, such as where, when, and how much their employees can spend without putting their owners’ personal credit at risk.

Why it’s great
Bento’s solutions are designed to save owners time and help eliminate expense ‘leaks,’ a type of fraud that can cost them up to 5% of their revenue each year.

Presenters

Farhan Ahmad, Co-founder and CEO

Ahmad was formerly managing director at Barclays and the global head of emerging payments and prepaid for Discover Financial Services. He has held leadership roles at JPMorgan Chase, Bank One and First USA.
LinkedIn

Sean Anderson, Co-founder and Chief Product Officer

Anderson was formerly senior director of emerging products at Blackhawk Network, where he built and launched their open API platform, launched an offers platform, and developed a prepaid processing platform.
LinkedIn

DoubleNet Pay automatically pays bills and funds savings goals directly from an employee’s paycheck, eliminating guesswork, late fees, and budgeting hassles.

Features:

Seamless integration with major payroll processors
Allows an employee to simply snap a picture of a current bill stub
Employees can easily create, fund, and redeem custom savings goals

Why it’s great
Bills are paid and savings funded automatically on payday, just like payroll taxes.

Presenters

Brian Cosgray, Founder and CEO

Cosgray has spent his entire career in financial services. Working with customers across the economic spectrum convinced him of the need to simplify and automate how people pay bills and save money.
LinkedIn

Cody Laird, Co-founder and COO

Laird is a financial technology veteran. Prior to co-founding DoubleNet Pay, Cody spent 21 years with SunTrust Bank helping to design and build their current retail banking platform.
LinkedIn

Bret Levy, Co-founder and CTO

Levy has been responsible for the architecture of many innovative, highly scalable software systems, most notably the Scientific Games system that powers most state lotteries.
LinkedIn

Karmic Labs provides API-based payment and SaaS solutions for card issuance (initially commercial market). Karmic offers Dash, FIS, and also uses Karmic’s APIs to offer its own product to FIs.

Features:

Robust API infrastructure for commercial card issuance
Payment virtualization layer
Creates a marketplace of innovative financial technology and SaaS solutions for the commercial market.

Why it’s great
Karmic labs offers API-based payment and SaaS solutions, of which its first product is Dash; the APIs are also used by FIS, a global leader in banking and payments technology, for its own product to FIs.

Presenters

Ryan Weidenmiller, CEO

Weidenmiller is an entrepreneur who built a top-ranked venture capital fund in China, now working on Karmic Labs’.
LinkedIn

Chris Agerton, CTO

Agerton was previously at Google, and was a founding engineer at Pinterest, responsible for developing high-availability architecture at Scribd.
LinkedIn

Troy Land, Group Executive of Emerging Commerce, FIS

Land is the group executive of emerging commerce at FIS within the retail payments division; he holds expertise in business and product development.
LinkedIn

SizeUp: SizeUp FI (financial insitutions) is big-data for small businesses. It enables FIs to provide their customers with business intelligence through the FI’s own website.

Features of SizeUp FI:

Enable your FI’s customers to :
- Compare their business performance with that of industry competitors
- Find customers, suppliers, and competitors
- Discover best locations to advertise

Why it’s great
SizeUp FI delivers a deeper business-customer partnership through success assistance; “sticky” client engagement; FI services awareness; and big-data insights that SMEs couldn’t previously access.

Presenters

Anatalio Ubalde, CEO and Co-founder

Ubalde is a successful entrepreneur leading Software as a Service (SaaS) ventures focused on data-driven solutions for small businesses and economic development.
LinkedIn

Thomas Barron, VP Business Development

Barron has developed corporate partnerships for 15 years from Fortunte 500 companies to 5-person startups. He previously worked at Visa developing strategic partnerships.
LinkedIn

Stratos consolidates cards into one dynamic card, making payments secure and smart. Stratos Digital Card Issuance Platform allows cards to download instantly, digitizing physical fulfillment.

Features:

Ensures virtual top of wallet, increases consumer engagement and loyalty
Provides secure card and wallet data
Eliminates costly physical card fulfillment

Why it’s great
Starts card working with Stratos Digital Card Issuance Platform to reinvent, not only your wallet, but also cards—just like the iPod and iTunes reinvented your CD collection.

Presenters

Thiago Olson, Co-founder, CEO

Olson worked at CERN and the Department of Defense and is a leader in next generation payments. He graduated with honors in engineering and physics at Vanderbilt.
LinkedIn

Henry Balanon, Co-founder, CTO

Balanon brings technical leadership and expertise to Stratos from his previous experience as co-founder of Detroit Labs, a leading mobile-app agency.
LinkedIn

TickerTags connects trending social content to investable companies through the monitoring of 250,000+ crowdsourced Tags that have the potential to impact a company’s business.

Features:

Track social velocity and sentiment of products/brands driving your investment
Create your own Tags to associate with Tickers for personalized trending notifications
It’s free

Why it’s great
We are a community-maintained platform intent on democratizing information-flow by evolving new monitoring from view-limited tickers to social -monitored tags.

Presenters

Chris Camillo, Co-founder, CEO

A pioneer in social arbitrage investing, Camillo’s audited portfolio has averaged 84% annual returns over the past 8 years.
LinkedIn

Trulioo’s bank-grade AML/KYC identity-verification product, GlobalGateway, enables businesses to perform frictionless ID verification for 3 billion people in more than 40 countries via 140 data sources.

Features:

Builds confidence and trust by preventing fraud and identity theft
Saves time, money, and resources through automated online ID-checks
Eliminates barriers to market entry

Why it’s great
Trulioo’s GlobalGateway provides advanced analytics from cyber and traditional data sources to verify identities online by powering fraud and compliance systems worldwide, increasing trust and safety.

Presenters

Stephen Ufford, Founder, CEO

Ufford has founded four data-focused startups over the last decade while working in the role of CEO. As a serial entrepreneur, he challenges the status quo and if it’s broken, he likes to fix it.
LinkedIn

Anatoly Kvitnitsky, Director of Corporate Development

With solid startup and corporate experience, Kvitnitsky leads strategic partnerships and data acquisition for Trulioo.
LinkedIn

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Finovate Debuts: CashSentinel’s Mobile Escrow Service

By Julie Muhn (@julieschicktanz) Posted on April 9, 2015
Categories: CashSentinel

CashSentinel enables people who do not know or trust each other to instantly and safely exchange a large amount of money, using their mobile phones.

The Switzerland-based company’s platform works similar to an escrow service combined with a mobile wallet that transfers funds in real-time.

Major benefits

Safer for both buyer and seller
Since neither party needs to carry cash, exchanging money for a vehicle is safer.
The transaction is secure
The system has built-in accountability. The buyer cannot incorrectly claim they sent the payment and the seller cannot incorrectly claim they didn’t receive the payment.
Mobile
After both parties have registered on the web or mobile platform, the transaction can take place either on the CashSentinel mobile app (available for iOS or Android), or via SMS; there is no need for a smartphone.

How it works

In the following example, a private party sells a used car to a private buyer; however, CashSentinel also works for small, commercial sellers and is not limited to vehicles.

1) Buyer loads funds

After the buyer registers online, CashSentinel verifies their identity by mailing them a secret word, which they will use later in the transaction (see step 4). Once the potential buyer finds a vehicle they’d like to purchase, they load the required amount of money onto the CashSentinel platform. If they decide not to purchase the vehicle, they can recoup the money in full.

2) Seller verifies

After the buyer loads the funds onto CashSentinel, they enter the seller’s phone number. This prompts CashSentinel to send the seller a push notification that the funds are ready.

To ensure that the buyer is serious, CashSentinel enables the seller to verify that sufficient funds have been loaded onto the platform (see below).

3) Transfer funds

When the parties meet in person to exchange the vehicle and agree on a price, they transfer the payment. They consent to the exchange by entering each others’ private, six-digit code (see below).

4) Confirm

After the buyer and the seller exchange their 6-digit codes, both need to finalize the transaction by confirming the amount. To do so, the buyer enters the secret word received in the mail. CashSentinel transfers the funds from the buyer to the seller and the transaction is irreversible.

Because funds are transferred instantly, the buyer drives away in the vehicle with the seller knowing the funds are good.

Fees

The service is entirely free for the seller. The buyer pays a tiered flat-rate that varies by the purchase price of the item.

What’s next

CashSentinel currently works only in Switzerland, but the company plans to expand operations into the European Union later this year.

CashSentinel demonstrated at FinovateEurope 2015 in London.

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Finovate Alumni News

By Julie Muhn (@julieschicktanz) Posted on April 9, 2015
Categories: Arxan Technologies, Bento for Business, CashSentinel, Dashlane, FreeAgent, Holvi, Kreditech, Malauzai Software, Patch of Land, PayPal, ProfitStars, Prosper

On Finovate.com

FreeAgent Scores $5 Million Line of Credit

Patch of Land Earns $23 Million Investment Led by SF Capital Group

FinovateSpring 2015 Sneak Peek: Part 2

Finovate Debuts: CashSentinel’s Mobile Escrow Service

Around the web

Nine Lives Media ranks ProfitStars’ Gladiator Technology in 6th annual MSPmentor 501 Global Edition.

Kreditech brings on Oliver Prill as COO.

PYMNTS: Prosper closes out financing round that pushes its valuation to $1.9 billion.

PYMNTS interviews Bento CEO and founder Farhan Ahmad. See Bento demo live at FinovateSpring in San Jose.

PayPal Makes Acquisition of CyActive Official.

TechCrunch: Dashlane’s “Inbox Scan” Tool Uncovers The Passwords You’ve Saved In Your Email.

Arxan expands application protection to support all major internet of things (IoT) platforms.

Holvi partners with identity-intelligence specialist GBGroup to ensure all customers are verified.

Malauzai Software announces 5 community banks to launch SmartwearApps for the Apple Watch.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

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The New New in Financial Technology

By Jim Bruene Posted on April 8, 2015
Categories: Strategic Planning

It’s about this time every year that someone tells me there just isn’t that much new going on, at least not like the “old days” (which could be last year, 2007, or 1997). Usually, they want me to change their mind, offer up some crazy examples of how the world of financial services is about to be turned on its head.

But things just don’t move that fast in the world of money, nor should they. In the past 50 years, there’s been a banking technology game-changer every 10 years or so:

1960s: Credit cards move unsecured consumer lending outside the branch
1970s: ATMs moved cash withdrawals out of the branch
1980s: Call centers moved customer service and account queries out of the branch
Late 1990s: The internet moved account queries away from the telephone, mail and ATM
Late 2000s: Mobile moved account queries away from the (desktop) web, and check deposits out of the branch
Late 2010s: ????

We are still hard at work on the mobile phase which started very late in the last decade. Apple didn’t allow outside apps until mid-2008, and it wasn’t really until 2009/2010 that mobile banking came into its own. And the Great Regulation push after the Great Recession, has stifled innovation somewhat.

However, halfway through the 2010s, I’m still unsure what history will show as the groundbreaking change of the decade. Here are three contenders:

Wearable computing: That’s just a workaround before less cumbersome technology comes along
Bitcoin/blockchain/crypto technology: It may be on the chart in the next decade, but I don’t think it gains dramatic traction in the next four or five years (at least not in countries with stable fiat currencies)
Crowdfunded/marketplace lending: While initially commercialized by Zopa, Prosper, Lending Club in the 2005-2007 period, it really didn’t get going until after the worst of the financial crisis had run its course in 2010/2011 (and after the SEC shut down the U.S. companies for half-a-year in 2008/2009).

My prediction: All three contenders are interesting and potentially huge. But I don’t think wearables or crypto will gain enough traction in the next four or five years to be considered the game-changers of this decade. But I do believe history will show that direct investor-to-customer lending (aka P2P lending or crowdfunding) begin to take hold in the mid-to-late 2010s.

Last year, total worldwide volume in crowdfunded loans was just $11 billion. That’s just 1% the size of a Chase, BofA or Citibank. So clearly, there is a long, long way to go before we start considering crowdfunded lending to be a disruption. But I believe it will begin to take measurable deposits and loans away from banks, credit unions and credit card issuers by 2018/2019.

We are due for a new game-changer, and I doubt we will be wearing it on our wrists.

——–

Picture credit: PixGood

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BBVA Taps Dwolla for Real-time Money Transfers

By Julie Muhn (@julieschicktanz) Posted on April 8, 2015
Categories: BBVA Compass, Dwolla

BBVA Compass and Dwolla began their partnership in October 2014, when BBVA opened its network to the Iowa-based startup.

Today, the two disclosed the first stage of their plan. BBVA Compass is using the startup’s FiSync payments protocol for real-time money transfers. The Alabama-based bank is the largest FI customer to implement the technology.

Dwolla will implement FiSync’s authentication and tokenization processes developed jointly by the two parties. These security processes eliminate the need for customers to grant merchants direct access to their bank account, thereby disclosing account and routing numbers.

Starting today, BBVA Compass clients can send funds in real-time to other BBVA account holders or Dwolla users.

The partnership is also good news for developers. Those with a BBVA Compass account can use Dwolla’s APIs to create their own real-time payments apps. BBVA Compass Chairman and CEO Manolo Sánchez says the FiSync payments protocol will help the bank adapt to customers who are used to getting everything on-demand and instantly. Sanchez says that by working with Dwolla, “BBVA Compass is ensuring that money is able to keep up with the speed of the instant economy. This will have a real and lasting impact on businesses and consumers alike.”

BBVA is mimicking Dwolla’s pricing structure of $0.25 for transactions above $10, with everything under $10 free. The two companies plan to roll out additional updates in the coming months.

Dwolla demonstrated FiSync at FinovateSpring 2012. You can also catch them at the upcoming FinovateSpring show in San Jose next month.

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Early Warning Acquires Authentify

By Julie Muhn (@julieschicktanz) Posted on April 8, 2015
Categories: Authentify, Mergers & Acquisitions, Payfone

Authentify, a company that offers phone-based, multifactor authentication to more than 1,200 financial institutions and e-commerce companies, today announced it will soon be acquired.

The acquirer is Chicago-based Early Warning, a company owned and governed by the largest banks in the U.S. and which provides risk-management solutions to 1,100 banks, government entities, and companies. Once the Authentify acquisition is under its belt, Early Warning will bolster its current offering with a multifactor authentication solution that integrates multiple channels and authentication methods.

The terms of the acquisition were not disclosed.

This is not Early Warning’s first move to broaden its offerings. In 2013, the Arizona-based company partnered with Payfone to combine device and customer-identity authentication with transaction data to ensure security. Early Warning has an equity stake in Payfone.

Authentify was founded in 1999 and Peter Tapling is CEO. The company demonstrated 2CHK at FinovateFall 2011.

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Patch of Land Earns $23 Million Investment Led by SF Capital Group

By David Penn Posted on April 8, 2015
Categories: Patch of Land

FinovateFall 2014 alum Patch of Land has raised more than $23 million in a Series A round. SF Capital Group led the investment, which included the participation of Ron Suber, president of Prosper Marketplace.

The investment is a major infusion of capital for the company. Patch of Land’s total funding now stands at $25 million. Neil Wolfs, SF Capital Group president, will join Patch of Land’s board of directors.

An innovator in the field of real estate crowdfunding, Patch of Land sees the investment as an opportunity to provide the loan products, such as construction and buy-to-rent loans. In this, building bigger and better relationships with institutional investors is key. “We look at them as our capital firepower,” COO Jason Fritton said. Additionally, the capital will help Patch of Land build out its team, adding loan officers, underwriters, and others.

Left: CMO AdaPia D’Errico and CTO Brian Fritton demonstrated the Patch of Land platform at FinovateFall 2014 in New York.

According to The Real Deal, the investment makes Patch of Land “one of the best-funded real estate crowdfunding platforms” in the country. The company has generated 12% annual returns for investors since inception, which is what may have helped spur interest among institutional investors. Issuing $17 million in short-term, commercial real estate loans without a single default likely provided additional impetus for larger investors to get involved in the real estate crowdfunder.

“We are excited to work with this dynamic team and help them capture the tremendous opportunity they have identified,” said Wolfson. “Patch of Land was one of the first companies to focus exclusively on real estate debt investments and the first to offer pretended loans, which dramatically shortens the time developers wait to get funded.”

Patch of Land was founded in February 2013 by Carlo Tabibi, CEO; Brian Fritton, CTO; and Jason Fritton, COO, and is headquartered in Los Angeles, California. The company has 10 employees; more than 2,500 investors; and more than 280 loans in its pipeline, with an average loan size of $240,000.

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FreeAgent Scores $5 Million Line of Credit

By David Penn Posted on April 8, 2015
Categories: FreeAgent, Lighter Capital

U.K.-based online accounting system provider Free Agent has raised $5 million in new debt financing courtesy of SaaS Capital. The new funding will be used helping the company acquire new customers.

Todd Gardner, founder and managing director of SaaS Capital said, “Free Agent is exactly the type of company we were looking to assist when we announced our new fund last month … (They) simply needed more capital to seize the market opportunity in front of them.”

Free Agent CEO Ed Molyneux says SaaS Capital’s investment was a unique opportunity. “We have historically raised equity and also used some venture debt, but we found the SaaS Capital solution to be a great way to finance our growth compared to those other options.”

FreeAgent CEO Ed Molyneux presented at FinovateEurope 2013 in London.

The financing from SaaS Capital comes in the form of a “revenue-based line of credit.” According to FreeAgent, this funding strategy will give the company the ability to deploy capital for longer periods than other lenders, as well as more flexibility when it comes to funding its own longer-term goals. Note that Finovate alum, Lighter Capital, specializes in this kind of financing.

FreeAgent’s cloud-based accounting system is geared toward freelance workers and what the company calls “micro-businesses” for whom other solutions are often too expensive and/or too complex. The company’s platform offers a wide variety of features to help manage business operations from tracking expenses to sending invoicing, to tax planning and filing.

FreeAgent was most recently in the headlines for its partnership with small-business booking-platform Appointedd announced in February, and last December, FreeAgent was selected to be a part of Lloyds Banking Groups new Business Toolbox.

Founded in April 2007 and headquartered in Edinburg, United Kingdom, FreeAgent made its Finovate debut at FinovateEurope 2013, where its online accounting system was demoed. The company has 50 employees and more than 27,000 paying customers. Ed Molyneux is CEO.

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Dealstruck Raises $8 Million in Funding, $50 Million for New Credit Facility

By David Penn Posted on April 8, 2015
Categories: Dealstruck, Uncategorized

In an investment that brings its total lending capacity to more than $100 million, direct lender Dealstruck has raised $58 million in new funding. The funding comes in the form of a $50 million credit facility led by Brevet Capital Management and the completion of a Series A round led by Trinity Ventures.

Co-founder and CEO of Dealstruck Ethan Senturia said, “Recent IPOs by alternative lenders validate an increasing need for new sources of growth capital. We look forward to building on our growth to date by setting even more businesses on the path to becoming bankable.”

The funding will be used to provide funding to small businesses across the country. Dealstruck has loaned more than $50 million since inception, and says it is the fastest online direct lender to reach and surpass the “$50 million lent” milestone.

(Left to right): Dealstruck CTO Russell McLoughlin and CEO Ethan Senturia presented at FinovateSpring 2014 in San Jose.

Talking about his firm’s investment, Doug Monticciolo of Brevet Capital focused on Dealstruck’s role in supporting small businesses, which Monticciolo called “an important engine of economic growth.” Added Noel Fenton of Trinity Ventures, “When small businesses succeed, it’s a win for everyone. Dealstruck is poised to help thousands of small- and medium-sized businesses grow.”

Operating in 43 states, Dealstruck offers three loan products: a term loan, an asset-based line of credit, and an inventory line of credit. Term loans are available up to $250,000, with lines of credit available as high as $500,000. Approved loans are funded within 48 hours.

Dealstruck made its Finovate debut at FinovateSpring 2014 in San Jose, where it demonstrated its Investor API. The company was founded in July 2012 by Ethan Senturia, CEO, and Russell McLoughlin, CTO, and is headquartered in Carlsbad, California.

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