logo  
Sign in or Register

Already a member?

Sign in

Or sign in with your account on:

Not a member yet?

Register
    

Lend Academy's Peter Renton on the 2014 LendIt Conference

By  +Follow June 9, 2014 1:45PM
Share:
Tickers Mentioned:

Early last month, most of the world’s primary experts in the field of online lending descended on San Francisco for the 2nd Annual LendIt conference to discuss all things peer-to-peer and online lending. A rapidly growing segment, P2P lending appears to have the potential to fundamentally shift the way personal and small-business lending happens.

Peter Renton, founder of Lend Academy and co-founder of the LendIt Conference, is one of the premier experts/educators in the P2P lending sphere. He spoke with Equities.com about what he learned at the conference and what everyone should know about P2P lending.

EQ: So the 2014 LendIt Conference, sponsored by Lending Club©, was held from May 4-6 this year in San Francisco. What did you learn there that the general public should really know and doesn’t at this point?

Peter Renton: One of the first things is that peer-to-peer lending is going to be very much about partnering with the banks going forward. A lot of people think that peer-to-peering lending as completely bypassing the banking system, but, when you think about it, the banks provide a valuable service. They’re just inefficient.

Renaud Laplanche, CEO of Lending Club, in his opening keynote at LendIt talked about their new partnership with Union Bank. Union Bank is one of the top 25 banks in the country and they are going to be working together to create new products. That’s going to be a very close, symbiotic relationship where Union Bank is going to be able to offer their customers Lending Club products and possibly vice versa.

Banks have been involved in lending for centuries, they’re going to want a place at the table here, and I think they will continue to be important. What I believe is going to happen is what was discussed in the Barclays (BCS) conversation at LendIt. Some of these banks are going to move more and more of their loan operations to these online platforms. Particularly when it comes to smaller loans. The Barclays guy even said that he expects in 10 years’ time, that Barclays could be a smaller bank than they are today, which speaks volumes to the disruption taking place today.

Another major theme of LendIt was the collaboration in this industry, how we’re still getting started and the biggest hurdle we have to overcome is the fact that people are still unaware of this industry. As Ron Suber, president of Prosper, said it is so important to build education, awareness and understanding. We’re still a small industry. For the most part, the general public doesn’t know about this industry and that is what we all need to focus on.

EQ: So what about securitization? Can we anticipate that being a part of the segment moving forward?

Renton: The first securitization took place less than 12 months ago in this industry with the Eaglewood Capital deal. Since then several more deals have closed including the OnDeck Capital deal announced on the eve of the LendIt. But when asked, industry leaders said that securitization is going to have a role going forward but it is not going to be the predominant driver of growth. And there’s not going to be the crazy derivatives and synthetic products that you’ve seen in other industries.

EQ: It sounds like a busy conference!

Renton: There’s plenty more I could tell you! We had some representation from the federal government. They are really becoming more and more aware of online lending, particularly when it comes to the small business side. There’s a whole bunch of free data at finance.data.gov that they will make available for anyone to use.

Underwriting was another important topic covered in depth at LendIt. There is a lot of data out there. The good platforms are using both traditional data and alternative data. By combining both, platforms can create better underwriting models and reduce defaults. Big data or alternative data is very popular these days, but data should only be used if it is truly predictive of financial behavior.

And finally, Charles Moldow of Foundation Capital gave a great presentation where he discussed his new white paper about peer-to-peer lending. He had created a new term for peer-to-peer lending called “marketplace lending.” He predicts that marketplace lending by 2025, so within 10 and a half years, will be a $1 trillion dollar industry globally. That was a big, bold statement that drew a lot attention as well.

EQ: How do people currently in the industry see the penetration of peer-to-peer lending in the general public happening? How quickly does it seem to be happening? Moldow’s estimate of $1 trillion a year in 10 years sounds pretty big.

Renton: The industry has been growing at more than 100 percent a year, and, from the talk at the conference, that growth rate is not slowing down. They feel like it’s going to more than double annually for a while.

This year, if you look at all the online lending and marketplace lending platforms, you’re going to be just south of $10 billion. So $1 trillion would be 100 times where we are today. But if you keep doubling it each year, it’s not going to take long. Two to the power of ten is 1,000. So if you double every year, Charles Moldow will actually be off by a factor of 10.

Clearly it’s not going to double every year forever; that’s simply impossible. But the sense is it’s going to double every year for at least the next two or three years before it slows down.

EQ: Are people talking about this going across borders and becoming a global phenomenon?

Renton: That was a major theme. One morning, we had an international session where we had a European panel and a China panel. That’s two of the major places outside of the U.S. where P2P lending is really taking hold. So, yes, there was a sense that it’s going to be a global industry. In fact, we had attendees from 23 different countries. People are coming to network from all over the world and they want to know what’s going on, so it’s going to be a global phenomenon.

There’s one company that is worth mentioning called Lendico. They are a German company, and they want to create the first global brand in this industry. They’re aggressive and they’ve got some deep-pocketed backers. They’re already in Germany, South Africa, and Spain and they’re planning on adding a new country every month or two for the foreseeable future. They are positioning themselves to be the first major global player in the industry.

But Renaud Laplanche, who is both a French and US  citizen, was asked directly at the conference what their international ambitions were and he said America is the complete focus right now. There’s still room for a tremendous amount of growth possible here. Lending Club is not interested, necessarily, in being that global brand, at least not right now.

Certain countries are going to be easier than others. One of the things that China is really struggling with is that there isn’t a great credit infrastructure there. Here, we have three main credit bureaus that have incredibly detailed information on all of us, and a similar ecosystem doesn’t exist in China. Many other countries are in the same boat, so peer-to-peer lending will have a more difficult time gaining a strong foothold in some places

EQ: It does occur to me that you’ve definitely seen, on the charitable side, a lot of push for micro-loans and serving under-banked communities around the world. Could P2P potentially fill some of that demand in the future with a for-profit model?

Renton: Oh, sure. That’s already starting to happen. Most of us know the great work that Kiva is doing – they have over a million accounts now with people lending money. They were on a panel at LendIt discussing the great work they have been doing. We also had another company by the name of Semble, which is a for-profit company providing finance for non-profits. Who’s the best person to provide a loan to a non-profit? It’s their donation base. So they work in that really innovative area.

There’s even one company that’s doing microfinance in Africa that is going after the African diaspora. There’s Africans living all over the world, investing in their home countries through microfinance. It’s really innovative stuff. I think we will see a blurring of the lines between non-profit microfinance and for-profit peer-to-peer lending.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


Liked What You Read? Join Equities.com and Connect With Your Favorite Financial Experts FOR FREE! Members of Equities.com gain access to our leading financial news and content, active social investment community, proprietary research tools including the 2014 Small-Cap Stars, E.V.A. reports and more.

Results for BCS
Georgina Hurst
30 Jan 15 10:07:18
When Global Banking Goes Wrong... http://t.co/NGDD6lIyo7 $BCS .@Barclays
Penny Stocks Blog
30 Jan 15 10:01:24
RT @mediasentiment: $BCS received a new alert. See why at http://t.co/5lwmDm2SCs #stocks #markets #daytrading 8
Media Sentiment
30 Jan 15 09:57:18
$BCS received a new alert. See why at http://t.co/5lwmDm2SCs #stocks #markets #daytrading 8
Penny Stocks Blog
30 Jan 15 09:07:54
RT @mediasentiment: $BCS received a new alert. See why at http://t.co/5lwmDm2SCs #stocks #markets #daytrading 7
Media Sentiment
30 Jan 15 09:05:58
$BCS received a new alert. See why at http://t.co/5lwmDm2SCs #stocks #markets #daytrading 7
Penny Stocks Blog
30 Jan 15 08:57:27
RT @mediasentiment: $BCS received a new alert. See why at http://t.co/5lwmDm2SCs #stocks #markets #daytrading 6
Media Sentiment
30 Jan 15 08:30:28
$BCS received a new alert. See why at http://t.co/5lwmDm2SCs #stocks #markets #daytrading 6
NASDAQ
30 Jan 15 08:25:45
$BCS - Amended Statement of Ownership (sc 13g/a) http://t.co/SHOK561Mju
US Banking News
30 Jan 15 08:23:28
Barclays Receives Consensus Recommendation of “Buy” from Analysts $BCS http://t.co/ELsMwvgbkX
James P Worthy
30 Jan 15 08:04:05
$BCS Barclays PLC (ADR) Analyst Rating Update http://t.co/qIAaibEkFf
Ticker Report
30 Jan 15 07:56:44
Barclays Receives Consensus Recommendation of “Buy” from Analysts $BCS http://t.co/BQt2wBEFMb
Media Sentiment
30 Jan 15 06:50:52
$BCS received a new alert. See why at http://t.co/5lwmDm2SCs #stocks #markets #daytrading 5
ProVesting
29 Jan 15 14:56:02
$SHAK $JPM $MS $BCS $GS $SF: Shake Shack Prices IPO at $21 Per Share: http://t.co/jVisbgcQ16
NASDAQ
29 Jan 15 13:12:31
$BCS - Brazil Central Bank Signals Further Increase in Interest Rates http://t.co/p5ovUbuu5I
NASDAQ
29 Jan 15 12:38:24
$BCS - Brazil Central Bank Signals Further Increase in Interest Rates http://t.co/mSj3y0nELV
ProTradersNews
29 Jan 15 08:26:04
$BCS: Barclays PLC (ADR) Analyst Rating Update: http://t.co/EkoxnfihTW
ProTradersNews
29 Jan 15 08:11:03
$BCS: Investec Reaffirms Buy Rating for Barclays (BCS): http://t.co/84M0OzqsK1
Wall Street
28 Jan 15 18:41:57
http://t.co/iQWRYqnOQl will not help you lose weight...but it will help you make money trading. Enjoy! $ALU $CLF $BCS $CDTI
Wall Street
28 Jan 15 17:27:41
http://t.co/iQWRYqnOQl....Top penny stocks, NYSE, and NASDAQ trades from the stock market today. +296% last week. $ALU $CLF $BCS $CDTI
John Turner
28 Jan 15 15:02:59
$BCS Barclays PLC (NYSE:BCS) Ready To Battle Eric Schneiderman's Dark Pool ... http://t.co/nRYiMmVo5l
NASDAQ
28 Jan 15 12:34:23
$BCS - Lehman Trustee Seeks to Pay Another $2.2 Billion http://t.co/GqEB3Qpxpt
ProTradersNews
28 Jan 15 12:21:03
$BCS: Fed Probable to Stand by Mid-2015 Rate Hike: http://t.co/oUzNVVw0In
Financial BUZZ Just-
28 Jan 15 11:44:23
See why these assets are trending in 1 watchlist $PBR $XOM $BCS USDCAD $WDC http://t.co/48wWJRWNA8
NASDAQ
28 Jan 15 11:05:45
$BCS - Barclays Bank PLC Extends Consent Solicitation Period for Select iPath® Commodities ETNs http://t.co/z1PYe9G9In
NASDAQ
28 Jan 15 10:37:56
$BCS - Oil Slides as U.S. Supply Seen Rising http://t.co/1l2eiqUuZf
NASDAQ
28 Jan 15 10:19:25
$BCS - Oil Slides as Supply Seen Rising Again -- Update http://t.co/iuAkC3VsWO
WKRB News
28 Jan 15 07:33:21
Barclays Stock Rating Reaffirmed by Investec $BCS http://t.co/2GvkFFjGDF
StockNewsWires
28 Jan 15 06:35:05
$MS $BCS $CS: Yesterday, the World Cup, today Canary Wharf, tomorrow...?: http://t.co/katlCdOwcs
Financial BUZZ Just-
28 Jan 15 04:14:06
See why these assets are trending in 1 watchlist $SVT $BCS $JMAT $PBR FTSE 100 http://t.co/e2hIvKvJ3p
ProTradersNews
27 Jan 15 23:23:03
$BCS: Barclays (BCS) - Investment Analysts' Weekly Ratings Updates: http://t.co/QwKI3AMOWg
ProVesting
27 Jan 15 23:22:09
$BCS: Barclays (BCS) - Investment Analysts' Weekly Ratings Updates: http://t.co/3PzEGWRYYq
WKRB News
27 Jan 15 23:19:04
Barclays $BCS – Investment Analysts’ Weekly Ratings Updates http://t.co/B8iMD5e79S
Saurabh Kumar
27 Jan 15 21:24:25
RT @MktOutperform: $JPM: up to $300 Million Gain On Swiss-Franc Turmoil $C, $DB & $BCS: about $400 million in cumulative trading losses htt…
Jonathan Giorgis
27 Jan 15 20:21:35
RT @MktOutperform: $JPM: up to $300 Million Gain On Swiss-Franc Turmoil $C, $DB & $BCS: about $400 million in cumulative trading losses htt…
ninja
27 Jan 15 19:58:38
RT @MktOutperform: $JPM: up to $300 Million Gain On Swiss-Franc Turmoil $C, $DB & $BCS: about $400 million in cumulative trading losses htt…
jesse livermore
27 Jan 15 19:54:42
RT @MktOutperform: $JPM: up to $300 Million Gain On Swiss-Franc Turmoil $C, $DB & $BCS: about $400 million in cumulative trading losses htt…
いつも悩んでる人
27 Jan 15 19:52:50
RT @MktOutperform: $JPM: up to $300 Million Gain On Swiss-Franc Turmoil $C, $DB & $BCS: about $400 million in cumulative trading losses htt…
Charlie Bilello, CMT
27 Jan 15 19:51:48
$JPM: up to $300 Million Gain On Swiss-Franc Turmoil $C, $DB & $BCS: about $400 million in cumulative trading losses http://t.co/o5eHPHfBi8
Penny Stock Secret
27 Jan 15 19:25:06
This Guy Turned $100 into over $10,000 In Just 30 Days! http://t.co/vezCDY95do .. $BCS-A $BCS-C $BCS-D
Penny Stock Secret
27 Jan 15 19:24:06
This Guy Turned $100 into over $10,000 In Just 30 Days! http://t.co/vezCDY95do .. $BCR $BCRH $BCS
US Banking News
27 Jan 15 15:12:32
Barclays’s “Buy” Rating Reaffirmed at Investec $BCS http://t.co/QE6o0vqyk5
ValueWalk
27 Jan 15 13:53:42
G-SIBs Need To Simplify Their Structure, Little Progress Made http://t.co/h21DxSPpCR $BAC $BCS $BNP $CS $C http://t.co/PvRr4hvyhc
Mark Melin
27 Jan 15 13:41:35
RT @valuewalk: JPMorgan Reported To Win Big On Swiss Currency Move by @MarkMelin http://t.co/C8gWbrNkxe $JPM $BCS $C $MS $CHF
ValueWalk
27 Jan 15 13:36:42
JPMorgan Reported To Win Big On Swiss Currency Move by @MarkMelin http://t.co/C8gWbrNkxe $JPM $BCS $C $MS $CHF
Ticker Report
27 Jan 15 13:26:30
Barclays Given “Buy” Rating at Investec $BCS http://t.co/zS5hm5rPZm
Analyst Ratings
27 Jan 15 13:16:28
Barclays's buy rating reiterated at Investec. http://t.co/eYEcx7VFo2 $BCS #BCS
US Consumer News
27 Jan 15 13:15:06
Barclays's buy rating reiterated at Investec. http://t.co/pTU5IeexWT $BCS #BCS
Wall Street
27 Jan 15 04:18:09
http://t.co/iQWRYqnOQl....Top penny stocks, NYSE, and NASDAQ trades from the stock market today. +296% last week. $ALU $CLF $BCS $CDTI
iHangout
26 Jan 15 21:01:12
chartguy89: 2015 Trending Stocks: BCS +0.41% Stock Charts $BCS Barclays PLC ADS http://t.co/wnKKLniJsB
chartguy89
26 Jan 15 21:00:05
BCS +0.41% Stock Charts $BCS Barclays PLC ADS (NYSE) Last Updated: 01/26/2015 23:00:13 BCS Stock Chart - 1 Mon http://t.co/SKM6omVy4z
				
				
By  +Follow June 9, 2014 1:45PM
Share:

Comments

 

blog comments powered by Disqus

About us

Equities.com is the most advanced interactive online social ecosystem for the financial industry, serving as a resource center and next-generation communication platform that connects self-directed investors with public issuers, market experts, and professional service providers and vendors. Registered members can leverage our exclusive proprietary research tools such as the Small-Cap Stars, which outperformed 90% of all small-cap mutual funds, and robust do-it-yourself E.V.A. research reports. The Equities.com Issuer Dashboard is the ideal tool to communicate and manage investor awareness campaigns to the investment community, as well as to access valuable resources to help your company grow.

Market Data powered by QuoteMedia.
Copyright © QuoteMedia. Data delayed 15 minutes unless otherwise indicated. Terms of Use.