PeerIQ raises $6 million
PeerIQ, a startup firm that is aims to be the go-to data provider for the growing peer-to-peer lending industry, has raised $6 million in funding from investors-including veteran Wall Street executives, venture capital firm Uprising, and boutique advisor Broadhaven-according to its chief executive.
Ram Ahluwalia, co-founder and CEO of New York-based PeerIQ, said the seed funding would help the New York-based startup build up its software to take in and analyze data from the growing universe of loans made through online marketplaces such as LendingClub Corp.
Some of these Wall Street “Angel investors” have backed other financial-tech startups, too, as excitement grows that banks’ traditional businesses will be hugely altered by new technologies.
He and Mr. Pandit also invested in Dataminr Inc., which analyzes tweets and other data for possible trading signals, and Mr. Pandit is a backer of Orchard, a platform that connects big investors with dozens of online lenders.
PeerIQ, founded last year, is developing tools that will analyze the performance and underlying risks of peer-to-peer loans, and will sell those tools to large investment firms.
Cautious investors have worried that without a full credit cycle’s worth of data; they can’t adequately predict how the loans will perform if the Federal Reserve raises interest rates sharply, or if the economy tumbles and borrowers struggle.
Mr. Ahluwalia said that better data could help spark additional securitizations, or packages of loans that are sliced up and sold to big investors.
Jerry von Dohlen, partner at Broadhaven Capital Partners, a boutique financial-services investment and advisory firm that is also backing PeerIQ, said
“The availability of this data will create opportunities for companies like PeerIQ to improve the functioning and liquidity of many credit markets, including those beyond.”
The irony of Wall Street’s veterans backing the platforms is that it is their old businesses that are being “Disrupted.” Together, Prosper, Lending Club and SoFi have arranged over $12 billion worth of loans since 2007.
Analysts recently estimated that of the $843 billion in consumer online lenders could replace loans outstanding, over $200 billion over the next five to ten years.
Lending Club is worth $7 billion after its IPO last December, and Social Finance Inc., or SoFi, was worth $1.4 billion after a fundraising earlier this year
(Credits to Telis Demos)
The post PeerIQ raises $6 million in Funding appeared first on TalksFriendite .