Wrap-up of the 2014 LendIt Conference

LendIt 2014 kicked off with a cocktail party sponsored by Lending Club
LendIt 2014 kicked off with a cocktail party sponsored by Lending Club

LendIt 2014 is now history. Around 950 people gathered at the Hilton Hotel Union Square in San Francisco for two days of educational sessions, presentations and networking.

There was a palpable feeling of excitement, I think in part because most people here did not consider this to be just another conference.  This industry is new and different and for many people, myself included, this is more than a job – it is our passion. It was this shared passion that made LendIt 2014 a special conference.

Earlier this week I gave a brief summary of the first day of the LendIt Conference. With this post I will go into a little more detail about both days.

Before the conference officially kicked off we had a cocktail party on the 46th floor of the Hilton Hotel that was sponsored by Lending Club. This was an informal affair where sponsors, speakers and select guests got to know each other while enjoying some of the best views in San Francisco.

LendIt Conference – Day One

When Renaud Laplanche kicked the conference off with his morning keynote on Monday it was standing room only in the main ballroom. And almost 2,000 people joined along online as we webcast the entire conference for free on www.lendit.tv.

Laplanche’s speech was highlighted by the announcement of Lending Club’s new partnership with Union Bank. That has been covered a lot in the press and partnering with banks was certainly one of the themes of the conference.

Here are some highlights and talking points from day one of LendIt 2014:

  • Laplanche introduced the term “marketplace lending” to describe the industry – peer to peer lending is no longer accurate.
  • Lending Club is partnering with Union Bank in a strategic alliance to provide innovative credit products to the bank’s one million customers.
  • There were more than 100 platforms in attendance at LendIt 2014.
  • Prosper is working on taking away the speed advantage of investing through the API. “That game is over,” says Ron Suber.
  • Also from Ron Suber: “Prosper is not interested in derivatives or synthetic products for this asset class.”
  • More automation is critical to providing better service for new borrowers – 70% of OnDeck Capital’s loan applications no longer require a human underwriter.
  • SAT score and type of major can be very predictive in assessing a young borrowers credit risk – Upstart incorporates this into their underwriting.
  • P2P Picks introduces LendGuardian for institutional investors without in-house analytics.
  • Semble has an innovative platform for providing loans to non-profits.
  • Mike Cagney, CEO of SoFi, explained why a sensible approach to securitization is good for the online lending industry.
  • Barclays invested in Rainfin, a tiny p2p platform in South Africa, because they see this industry getting very big and traditional banking getting smaller.
  • Credit is changing from a manual process to an automated and efficient exchange.
  • We need to further the education, awareness and understanding of borrowers. This is the competition today – not banks.

There was a well-attended cocktail hour sponsored by Prosper in the exhibit area after proceedings on Monday. Then everyone went their separate ways – with some attending one of the many unofficial parties being hosted that night.

LendIt Conference – Day Two

We kicked off day two of LendIt bright and early with a keynote by Michael Barr, a former Assistant Secretary to the Treasury and currently a law professor at the University of Michigan, and a Lending Club advisor. Here are some of the talking points from day two:

  • Michael Barr implored the platforms to take the high road when it comes to transparency and education – this will help prevent any further regulatory interest.
  • All of the major European p2p lenders are moving from a purely retail investor focus to a mix of retail/institutional investors.
  • In China 65% of personal savings are in bank deposits collecting minimal interest – this is one of the main reasons why p2p lending is exploding in China.
  • Lendvious is a new aggregation platform that wants to be the Kayak of p2p lending.
  • By 2025 Charles Moldow of Foundation Capital says that marketplace lending will be a $1 trillion industry globally.
  • Moldow also announced the release of his new detailed new white paper, A Trillion Dollar Market By the People, For the People.
  • Frank Rotman from QED Investors says that credit it like fire. It can light up a room or if not managed well it can burn your house down. Responsible startups in this space recognize this.
  • Many people do not realize that the federal government provides free data resources to help online lenders – details are at finance.data.gov.
  • We need to break down the walls between alternative and traditional data – just call it data. As long as it is predictive we should use it.
  • One of the growth opportunities for online platforms is to go down the credit ladder into “emerging prime” and even sub prime consumers have potential if managed well.

LendIt Innovator of the Year Award

Jon Barlow (left) of Eaglewood Capital accepting the LendIt 2014 Innovator of the Year Award
Jon Barlow (left) of Eaglewood Capital accepting the LendIt 2014 Innovator of the Year Award

Also on day two we presented the first ever LendIt Innovator of the Year Award. We created this award to recognize the company that has produced a major innovation in the previous 12 months that pushes the industry forward. The winner of the inaugural award was Eaglewood Capital Management for their work in creating the first ever securitization in this space.

On both days, while the sessions in the main ballroom were happening, we had a second track featuring many company presentations and demos. In these sessions people heard from many of the platforms and support companies in this industry. The second track was run efficiently by Simon Cunningham of LendingMemo with the support of Ryan Lichtenwald of Peer & Social Lending.

It was a whirlwind couple of days for me as I was often wanting to be in two places at once. I missed out on seeing many of the sessions that I wanted to see but not to worry. Every session was recorded and we will have everything loaded on the LendIt.TV (in reality our YouTube channel) shortly.

LendIt 2014 Presentations

We have received many requests for copies of all the presentations. Here are all the presentations from the main ballroom:

Renaud Laplanche of Lending Club (Size: 20 Meg file)
Peter Renton of Lend Academy (8 Meg)
Sam Hodges of Funding Circle (3 Meg)
Mike Cagney of SoFi (1 Meg)
Ron Suber of Prosper (not downloadable)
Michael Barr of University of Michigan (8 Meg)
Charles Moldow of Foundation Capital (3 Meg)

Next Up – LendIt Europe

Now that LendIt 2014 is behind us we are turning our attention across the pond. LendIt Europe will be on November 17 in London. Stay tuned for more details.

Thanks to everyone who helped make LendIt 2014 the big success that it was. I look forward to seeing you you in London in November or at LendIt 2015 in the spring.

LendIt 2014 organizers from L to R: Bo Brustkern, Jason Jones, Peter Renton and Dara Albright
LendIt 2014 organizers from L to R: Bo Brustkern, Jason Jones, Peter Renton and Dara Albright

  • 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.