More big news out of Lending Club this morning. I reported in May about Google’s investment in Lending Club that resulted in a $1.55 billion valuation for the company. Today, Ari Levy from Bloomberg broke the story that Russian billionaire Yuri Milner’s DST Global and Coatue Management LLC have invested $57 million in a secondary round at Lending Club. The story also stated that with this transaction Lending Club is now valued at $2.3 billion, up 48% in just the last six months.
The transaction values LendingClub at $2.3 billion, said two people with knowledge of the deal, who asked not to be identified because the valuation is private. LendingClub Chief Executive Officer Renaud Laplanche said the share sale closed yesterday and consisted entirely of stock purchased from early backers.
As Laplanche said above this is not money that is going on to Lending Club’s balance sheet, it is a secondary round. Meaning that shares have been purchased from existing Lending Club shareholders.
The increased valuation does not surprise me at all. In October, Lending Club’s monthly new loan volume was up 50.7% from May when the Google deal was announced. So an increase in valuation of 48% is right in line with this increase.
Here is another interesting little nugget from the story:
At its new valuation, LendingClub is among the highest-priced private technology companies now that Twitter Inc. (TWTR:US) is publicly traded. Startups worth more than $2 billion include file storage provider Dropbox Inc., room-sharing service Airbnb Inc. and online billboard Pinterest Inc.
Lending Club is in some pretty good company there. It certainly bodes well for them as they gear up for their IPO that is supposed to happen next year. And I wouldn’t be surprised to see more transactions like this one before that IPO happens.
Peter Renton is the chairman and co-founder of Fintech Nexus, 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.