Where Are They Now? FinovateSpring Alums Raise More than $326 Million in a Year

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Last week we took a look at what the alums of FinovateSpring 2015 have been up to in the year since they demoed on the Finovate stage. Today, we’re focusing on the funding.

All $326 million of it.

Of the 72 companies that demoed at FinovateSpring 2015 in San Jose last year, 21 of them had raised capital within a year. Kabbage’s raise of $135 million certainly stands out. But the $25 million investment picked up by itBit in May of last year, as well as the $15 million raised by Trulioo and the $12 million raised by Moven were also major contributors to a strong fundraising performance from the Class of FinovateSpring 2015. And this doesn’t even include companies such as Yodlee, which was acquired by Envestnet for $660 million, or Aurora Financial Systems, bought by fellow Finovate alum, Finicity, for an undisclosed sum.

March 2016

January 2016

Dec 2015

October 2015

September 2015

August 2015

  • [M&A] Holy Yodlee! Envestnet to Buy Yodlee for $660 Million – video

July 2015

June 2015

May 2015

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FinovateSpring 2016 is less than a month away. Pick up your tickets today and save your spot at our upcoming spring conference in San Jose, California.

 

Finovate Alumni News

On Finovate.com

  • Check out this week’s FinDEVr APIntelligence.
  • Akamai’s New Bot Manager Offers Insight into Bot Activity.

Around the web

  • Morocco-based microfinancier, Albaraka implements core banking system and CRM from Infosys Finacle.
  • Aerospike unveils version 3.7 of its NoSQL database. Aerospike returns to FinDEVr on 29 & 30 March 2016 in New York City.
  • TransferTo forges partnership with Vodafone Group to bring real-time international money transfers to M-Pesa Mobile Money accounts.
  • LoanNow begins reporting loan repayment behavior data to TransUnion.
  • Taulia partners with supplier information management solutions company Lavante.

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.

LoanNow Secures $50 Million Credit Facility

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In a deal that will help the company better serve its non-prime, middle-income customer base, LoanNow has secured a $50 million credit facility from an undisclosed institutional investor.

LoanNow’s President and COO Miron Lulic credited his company’s ability to “uniquely identify, assess and ultimately incentivize deserving borrowers that would otherwise lack affordable options.” The financing comes in the wake of LoanNow announcing it was nearing the $10 million mark in terms of personal loans originated in its first full year in operation.

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LoanNow CEO and co-founder Harry Langenberg demonstrated LoanNow Group Signing at FinovateSpring 2015 in San Jose.

LoanNow specializes in providing financing options for borrowers with credit scores of 650 or less. The company’s platform monitors borrowers’ financial behavior, rewarding timely and consecutive payments, and the addition of micro-cosignatories. LoanNow says its dynamic loan-replayment process can result in APR reductions of as much as 50%. Loans are available up to $5,000, with terms of up to 48 months.

Currently available in five states, LoanNow expanded to New Mexico in August and to Utah in June. In July 2015, the company earned a spot in Orange County Business Journal’s “Best Places to Work in Orange County 2015” roster.

Founded in June 2013 and headquartered in Santa Ana, California, LoanNow demonstrated its group signing feature at its Finovate debut at FinovateSpring 2015.

Finovate Alumni News

On Finovate.com

  • Soundpays Appoints Steve Doswell as CEO”
  • Backbase’s 2015 Metrics Report Cites 35% YoY Revenue Growth”
  • FundAmerica Shares Growth Metrics, Plans for 2016″
  • LoanNow Secures $50 Million Credit Facility”

Around the web

  • Billhighway awarded National Best and Brightest Company to Work For for fourth year in a row.
  • CloudLock and Check Point Partner to attack hybrid cloud shadow IT and malware through detection, quarantine, and eradication.
  • InComm acquires TibiDono, Austria-based marketing and gift-card-distribution company.
  • Cachet Financial Solutions to power RDC solutions for Illinois-based Algonquin State Bank.
  • Roostify appoints Iyad Darcazallie CFO and COO, names Scott Stein VP of sales.
  • GMC Software named leader in Gartner Magic Quadrant for Customer Communications Management Software for third consecutive year.

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.

Finovate Alumni News

On Finovate.com

  • “Finovate Debuts: Slice Introduces Intelligent Shopping API”
  • “Arxan Technologies Drafts Joe Sander as CEO”

Around the web

  • Kasasa reaches milestone: 300+ community FIs now offer Kasasa to members, a total of 823,000 accounts.
  • NY Times lists Betterment, Coinbase, Wealthfront, ZenPayroll as companies that may be the next startup unicorns.
  • Crowdfund Insider: Zopa tops £1 million in loans, a U.K. first for peer-to-peer lending.
  • Global News interviews Karl Martin, Nymi CEO and founder.
  • Trustly bolsters team with appointments from H&M and Klarna.
  • FIS launches financial inclusion lab in India.
  • SME Insider interviews CurrencyTransfer.com‘s CEO Daniel Abrahams.
  • Silanis to deploy eSignLive technology with TransGuard and Occidental Fire & Casualty.
  • Puerto Rico-based Evertec to enable mobile e-commerce courtesy of Acculynk’s PaySecure.
  • Payoneer wins contract with Dailymotion.
  • NPR interviews Pindrop Security‘s CEO Vijay Balasubramaniyan.
  • Selling Power ranks OnDeck 17 out of 50 on its list of 2015 Best Companies to Sell For.
  • Nostrum Group receives FCA authorization for debt administration to cover its involvement in customer loan accounts and debt collection.

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.

Finovate Alumni News

On Finovate.com

  • “Behalf Closes $119 Million Series D”
  • “Neon Release Adds Touch ID and Enhanced Notifications to Oink 2.0″
  • “ShopKeep Rings Up $60 Million Investment”

Around the web

  • Citibank India and MasterCard launch digital wallet, Citi MasterPass, in India.
  • This is Money features TransferWise in a look at the lack of transparency in exchange fees.
  • LoanNow earns #4 spot in Orange County Business Journal’s “Best Places to Work in Orange County 2015” roster.
  • PYMNTS looks at how PayPal’s Paydiant is powering Subway’s mobile-payments app.
  • Payments Views talks with Doug Yeager, HCE inventor and CEO of SimplyTapp, in its latest podcast.
  • Expensify launches New Investment Fund, Expensify Ventures, for fintech startups.
  • American Banker considers how banks are using startups such as Social Money and Qapital to bolster their offerings.
  • Dashlane launches One-Tap Password Changer for Apple Watch and iPhone.
  • John Hancock Retirement Plan Services now offers Morningstar’s HelloWallet financial wellness tool to plan-sponsors on its Total Retirement Solution platform.
  • Arroweye Solutions to provide EMV Credit and Debit Cards for Mountain America Credit Union.
  • TechCrunch: Betterment tops 100,000 customers and $2.5 billion AUM.
  • Taulia reports record revenue and ten customer wins for Q2 2015.
  • Mobile Payments Today looks at InComm’s drive to bring open-loop prepaid to mobile wallets.

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.

 

Finovate Alumni News

On Finovate.com

  • Mobile Fees: BillGuard Goes Freemium with Integrated Credit Monitoring
  • New $175 Million Investment Earns Credit Karma a $3.5 Billion Valuation
  • Lake Trust Credit Union Launches Larky-powered Mobile Rewards App

Around the web

  • The Financial Times looks at progress from robo-advisor services Nutmeg and Money on Toast.
  • FCI Federal Credit Union deploys CruiseNet core processing system from Jack Henry’s Symitar division.
  • UPS Capital, the financial services business division for United Parcel Service, to offer loans to its small business customers via Kabbage.
  • Motif launches new website for improved user experience.
  • Fortune Magazine and Great Place to Work name On Deck Capital 1 of 100 best places to work for millennials.
  • CU Management features Onovative in a discussion on innovations in new member onboarding.

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.

Finovate Debuts: LoanNow Helps Borrowers “Outperform their FICO Score”

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Years after the financial crisis, lenders remain reluctant to fund borrowers with less than perfect credit. LoanNow combines more than a decade of experience in lending; top engineering talent (“most of our team is ex-Amazon” the LoanNow team tells me); and a fresh approach to managing risk to provide better loan programs to the subprime borrowing population.

Company facts:

  • Founded June 2013
  • Headquartered in Santa Ana, California
  • More than $5 million in funding raised
  • More than $3 million in loans issued
  • 25 employees

“Everybody has friends with bad credit,” says LoanNow CEO Harry Langenberg in a conversation during Finovate week. “But you’d still loan them your car. We’re trying to help people outperform their FICO scores. [In doing so] we are producing a lower-cost loan during the lifetime of the loan.”

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From left: LoanNow co-founders Harry Langenberg, CEO, and Miron Lulic, COO, demonstrated LoanNow Group Signing at FinovateSpring 2015 in San Jose.

The story

What makes LoanNow possible is a combination of technological and regulatory opportunities and a group of individuals eager to take advantage of them. Company founder and CEO Harry Langenberg and COO Miron Lulic have more than 12 years of experience building a variety of companies that addressed different consumer needs. After the financial crisis, with banks shunning borrowers with less than sterling credit, Langenberg and Lulic saw an opportunity to work with subprime lenders.

“We saw ourselves as a team of A players in a C-level industry,” they explained. “We could succeed where others were afraid to go.”

What Langenberg and Lulic brought to subprime lending was a belief that a closer focus on individual borrower behavior can bring default rates down. They use algorithms and a variety of technical tools to look at far more factors than the FICO score. “FICO is a bad way to judge people in subprime categories,” Langenberg says. “We don’t just look at past data. We also look at the real-time performance while the borrower is in the loan, as (the borrower) pays it down.”

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LoanNow’s Group Signing feature, demonstrated at FinovateSpring 2015, is another example of leveraging technology with an understanding of the borrower to make better loans to those unable to rely on traditional lenders. Group Signing lets borrowers leverage their social networks, encouraging friends and family members to pledge to help retire some fraction of the loan if the borrower defaults. Based on the number of group signers and the amounts vouched for, borrowers earn credits to lower the loan rate.

Since lending is risk-based, the core problem of subprime must be solved: reduce the risk of defaults. Langenburg says the goal becomes how to manage and drive down risk when interest rates are high and pricing is up because of defaults.

There’s more to the LoanNow platform than the Group Signing feature. But the feature, demoed at FinovateSpring 2015 in San Jose, is both new and a great example of LoanNow’s concept of “social credit” in action.

How it works

Group Signing takes the traditional concept of co-signing and brings in into the 21st century. Borrowers taking advantage of the Group Signing option use the LoanNow platform to send a note to friends and family members who might be willing to vouch for the LoanNow loan. By vouching, Group Signees agree to pay a fraction of the borrower’s loan in the event of default.

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Having a large number of Group Signees (and/or having a significant amount of the loan “group-signed”) gives the borrower credits used to lower the interest rate on the loan. By making debt less expensive and easier to retire, borrowers are better able to improve their credit score. LoanNow’s ultimate goal is to help subprime borrowers move out of the category altogether.

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After accepting a Group Signing invitation, the platform thanks the Group Signee for participating and asks for a pledge amount ($25 minimum). Pledges are made with credit/debit cards from Visa, MasterCard, Discover, Maestro, or Visa Electron. Cards are not charged unless the borrower defaults.

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The LoanNow platform provides the borrower with a dashboard to track loan obligations. Friends and family members who have agreed to group-sign or “vouch” loans not only can be tracked, but also any loans the borrower has vouched for. The dashboard also gives a “Score Feed.” The Score Feed reminds the borrower of those who have group-signed for the loan, and also shows the vouch amount and how that vouching contributes to the borrower’s overall group-signing credit total.

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LoanNow currently operates in its home state of California as well as in Utah and Missouri. Loan amounts range from $2,500 to $5,000 in California, and $1,000 to $5,000 in Utah and Missouri. Terms range from 9 months to 24 months. Application is a quick, five-minute process and, as a direct lender, LoanNow can guarantee a rapid response. Loans are deposited directly into the borrower’s account.

The future

Going forward, LoanNow’s biggest focus is to expand operations. Currently in three states, and with 20 employees, the company is looking to double or triple its headcount by the end of the year. While currently lending half-a-million a month, LoanNow would like to triple or quadruple that number in the same time frame. The company is finalizing talks with a financial partner, with a potential announcement coming by the end of June 2015.

“We came to Finovate to meet banks and credit unions and are looking to partner with them,” said Langenberg. “Our platform for subprime borrowers is also a place to monetize leads and [pick up] a mismatch in their loan programs that we can help them fix and monetize.”

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“We are investing heavily in the platform, more so than before,” said Langenberg. And that represents a commitment of not only financial capital, but also human capital. “Our platform is an entire banking infrastructure built from scratch,” he said. “We are always looking for great engineers.” LoanNow also boasts of a strong legal team to make sure they remain compliant; the company is also looking for legal talent, with plans to double the size of their legal team by January 2016.

“We are specialists on the behavioral data in this space,” said Langenberg. “We are looking to extend beyond consumer loans to work with less than perfect credit in other categories such as auto loans. We want to be the white-hat leader in this space.”

LoanNow demoed its LoanNow Group Signing technology at FinovateSpring 2015 in San Jose.

Finovate Alumni News

On Finovate.com

  • “Finovate Debuts: LoanNow Helps Borrowers ‘Outperform their FICO Score'”

Around the web

  • HedgeCoVest launches its real-time, hedge fund replication platform.
  • First Republic Bank to deploy virtual banking solutions from Q2 Holdings.
  • The Independent takes a look at Klarna and the power of micropayment.
  • oneID featured in MacWorld as a two-factor authentication app for the Apple Watch.
  • Allied Wallet now a supported online payment provider of Spreedly.
  • emX Select from eMoney Advisor now integrated with Dropbox.
  • Süddeutsche Zeitung features Trustly and Klarna (in German).
  • Bank Innovation profile on alternative fintech capitals looks at Iceland and highlights Meniga.
  • Ripple Labs adds former Depository Trust & Clearing Corporation (DTCC) CEO Donald Donahue as advisor.
  • A review of local fintech startups in the Boston Globe features Kensho and Quantopian.
  • Temenos wins “Best Core Banking System” honors from Banker Africa East Africa Awards 2015.
  • American Banker considers how Namu covers the emotional side of banking.
  • Entrepreneur lists Patch of Land as 1 of 100 brilliant companies to watch in 2015.
  • Pendo Systems wins awards from international financial technology publications, the New Jersey Technology Council, and SWIFT.
  • Asian Wealth Times: “Singapore’s MoneySmart to Launch PFM tools with Ewise”
  • Finaeos teams up with TATA Consulting Services to help SMBs take advantage of Regulation A+ of the JOBS Act.

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.

LoanNow Uses Motivational Lending to Help Borrowers Reduce the Cost of Credit

This post is part of our live coverage of FinovateSpring 2015.

LoanNow-logo-noTM-flatLoanNow is introducing a new way to co-sign loans; it’s called “Group Signing.”

LoanNow is debuting a groundbreaking new form of loan co-signing called “Group Signing” as part of its motivational lending platform. Group Signing amplifies the traditional benefit of a co-signer by leveraging crowdsourcing technology to share the risk among a broader group of people in smaller allotments. This lowered risk profile allows LoanNow to actively pass along its own risk savings in the form of a lower APR during the loan lifecycle. Combined with other active APR reduction incentives LoanNow now offers, Group Signing has the potential to save borrowers significant amounts of money in interest payments.

Presenters: Harry Langenberg, CEO and co-founder, and Miron Lulic, president, COO and co-founder

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Product Launch: May 2015

Metrics: $5M raised, $3M in loans issued to clients, 25 employees
Product distribution strategy: Direct to Consumer (B2C)

HQ: Santa Ana, California
Founded: June 2013
Website: loannow.com
Twitter: @loannow