Today Prosper announced that they have closed another funding round, this time for $17.2 million. It came from several of their existing investors as well as from some new investors as well. Here are some of the details from the press release:
Prosper.com, a social lending marketplace that brings together creditworthy borrowers with individual and institutional investors, today announced that it has raised over $17 million in funding from new investors Draper Fisher Jurvetson and CrosslinkCapital. Existing investors Accel Partners, CompuCredit, Omidyar Network, TomorrowVentures, and Volition Capital also participated in the round.
This $17.2 million funding round is their largest cash injection to date and brings their total cash raised to $74.7 million. Based on their latest financials it was clear that Prosper needed a new cash injection soon. This new injection will give them breathing room now for at least year and probably longer. Prosper has been on a steady growth curve for the last six months and with this higher loan volume will likely be reducing their cash burn rate as they start to generate more cash from operations.
Executives from their new investment partners, Draper Fisher Jurvetson and Crosslink Capital will join Prosper’s board of directors. Here is a quote from one of these new directors:
“Broad access to affordable consumer credit remains one of the enduring challenges for the American economy,” said Tim Draper, founder and managing director of Draper Fisher Jurvetson. “We have watched Prosper build a mature, successful model for opening up the capital markets directly to millions of hard-working Americans that are seeking to borrow or lend capital affordably and with a meaningful return. We are excited to be a part of it.”
All in all this is great news for Prosper and for p2p lending in general. The industry has two strong players (Prosper and Lending Club), both of whom are in great positions now financially as they ramp up their growth. Not only that but there continues to be great innovation (as I reported yesterday) from new companies looking to enter the space. We now have a thriving and vibrant p2p lending industry in this country.
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.