The current management team at Prosper continues to provide us with pleasant surprises. Today, they announced they have closed an additional funding round totaling $25 million led by existing investor Sequoia Capital and newcomer to the space BlackRock.
The addition of BlackRock was quite a surprise. Although, I was told in my meetings at Prosper headquarters a couple of weeks back that this round was coming and a very big name was participating. And they don’t get much bigger than BlackRock. They are the world’s largest asset manager with a staggering $3.9 trillion under management. Brian Stern, a Managing Director at BlackRock and a senior member of BlackRock Alternative Investors is the person quoted in the press release.
What is interesting to me is that, just like in January, Sequoia led this funding round. They obviously like what they have seen from Prosper over the last eight months and so they doubled down on their investment. But what is even more interesting is that a big name like BlackRock had p2p lending on their radar. Not only that but they were following it closely enough to want to make an investment here. This is yet another indication of the movement towards the mainstream for this new asset class.
Over a $100 Million Valuation
When the new executive team took over in January Prosper was valued at around $38 million. Today, just eight months later I was told by a reliable source that their pre-money valuation on this deal was over $100 million. That is impressive. Not only that but they said that they could have easily raised more than $25 million if they had wished – even at this much higher valuation. There was a lot of appetite from the VC community and they had to turn some investors away.
This $25 million brings the total raised by Prosper since their inception to $119.9 million, of which $45 million has been raised this year. Maybe this will be the last cash infusion although we certainly can’t rule out another one. Personally, I would like to see Prosper take this latest funding and ride it all the way through to profitability.
Now, with the class action lawsuit behind them, a large cash war chest and an ever increasing top line Prosper has everything going for them. With growing investor interest and a more efficient borrower funnel it should be smooth sailing ahead for Prosper.
Peter Renton is the chairman and co-founder of LendIt Fintech, the world’s first and largest digital media and events company focused on fintech. Peter has been writing about fintech since 2010 and he is the author and creator of the Fintech One-on-One Podcast, the first and longest-running fintech interview series. Peter has been interviewed by the Wall Street Journal, Bloomberg, The New York Times, CNBC, CNN, Fortune, NPR, Fox Business News, the Financial Times, and dozens of other publications.