San Francisco-based peer-to-peer lending platform SoFi (Social Finance) raised a $200 million Series D led by Third Point Ventures and affiliates of Third Point LLC, with participation of Wellington Management Company LLP, Institutional Venture Partners and existing investors.
Founded in 2011, SoFi has raised over $760 million in venture capital. To date SoFi has originated over $1.75 billion dollars in loans. At the time of its $80 million Series C in April 2014, the company funded $450 million in loans of over 5000 lenders.
The new funding values SoFi at $1.3 billion ahead of its upcoming IPO, reports FT. Peer-lending platforms LendingClub and OnDeck are currently valued at $7 billion and $1.1 billion after their respective IPOs. The Series D round will enable SoFi to further expand into consumer lending products throughout the United States and add new options for investors to its loan marketplace.
Last month Bloomberg reported that SoFi was planning to sell $313.8 million of securities backed by student loans
“the largest bond offering yet from a firm that extends credit to consumers through an approach known as marketplace or peer-to-peer lending.”
The idea behind peer-to-peer lending platforms is that borrowers are less likely to default on loans made through a community rather than taking a loan from a faceless lender. At SoFi borrowers can expect a 5% ROI on average.
Besides its loan marketplace, SoFi offers related services like career advising, unemployment protection, a member network and entrepreneurial support for founders.
Further Reading
- Leading Marketplace Lender SoFi Secures $200 million in Series D Funding | Press Release
- Peer-to-peer lender SoFi raises $200m | FT
- Peer-to-Peer Lender SoFi Planning Its Largest Sale of Securities | Bloomberg