SAN FRANCISCO–The man who co-founded Lending Club in 2006 is back with a rival company based on the same model.
Renaud Laplanche has started a new company called Upgrade that will compete with Lending Club and other so-called P2P lenders. Laplanche was ousted from Lending Club over what the board alleged were falsified loan records, after he had helped take the company public, the New York Times reported.
According to the Times, Upgrade will begin by offering small loans to Americans who want to refinance credit card debt, the bread and butter of Lending Club’s business. The goal is to eventually move into home and auto lending, as well.
To date, Upgrade has attracted $60 million in financing from venture capitalists. Laplanche told the Times Upgrade will reflect lessons learned while at Lending Club, and will also offer free credit monitoring tools and financial education to keep customers engaged even if their initial loan applications are rejected.
Despite having been pushed out of Lending Club and the new venture, Laplanche remains one of Lending Club’s largest shareholders, with a stake worth about $40 million, the Times reported.
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