Social Finance Archive

Social lending company Prosper has announced that they have resumed lending beginning today. Prosper CEO Chris Larsen has a blog post explaining the changes that are part of the updated offering.

From the release, “The California Department of Corporations, recognizing the urgent need to get consumer and small business credit flowing, accelerated the process of granting regulatory approval to Prosper so that it could reopen immediately. Prosper had ceased all lending activity on Prosper Loans Marketplace and has been in a quiet period since October 2008 while it registered for approval with the Securities & Exchange Commission. That process has not yet been completed and is still ongoing. As such, Prosper is open to borrowers nationwide, but for the time being only residents of California and institutional investors whose primary place of business is in California can take advantage of the alternative investment opportunity Prosper loans provide. Likewise, only California lending companies can list loans on the Prosper Open Market.”

The updated Prosper Loans Marketplace now require that individual borrowers have credit scores above 640 as part of their new “Prosper Ratings” system. Prosper notes, “Prosper Ratings are based on historical loan performance data and are designed to better convey risk. While the estimated loss rate and estimated returns have been shown at the point of bidding since October 2007, the Prosper Rating letter grade as well as the estimated loss rate will be shown in the listing along with a narrower credit score range and other extended credit data.”

Prosper has also launched an Open Market initiative which lets financial insitutions participate in their network.

Competitor Lending Club exited the SEC quiet period last October. If you are new to social lending, our three-part social lending series will get you up-to-speed. 

Two common and popular themes in our big old Internet conversation lately have revolved around the meaning of money.

A lot of people are increasingly convinced that capital is no longer solely tied up in dollars and cents; the concept of value is beginning to carry as much weight as traditional concepts of cost/price, largely due to public relations and marketing in social media.

In other words, try explaining to a client, a typical B2C brand, that they’ve just spent $10,000 to create a Facebook app that will generate no revenue. You have to get that client to agree that mindshare and conversation, a.k.a. social capital, are as necessary in the new marketplace as more traditional media measurements such as impressions and conversions.

So, as my checking account teeters along the fine line between “I can afford a good sandwich” and “I can’t afford to take calls from debt collectors,” my social accounts are beginning to grow and thrive in a separate but related economy.

This becomes exciting when I realize that I can trade my mindshare for goods and services (maybe a website design from a rad youth branding firm, maybe a better laptop from a sponsor who wants to associate itself with my video blogging).

It becomes even more exciting when I think about leveraging that mindshare into enough microdonations to accomplish a noble goal, say, helping my little sister raise money for cancer research.

Yep, the little ladybug is all grown up; in addition to being passionate about the environment and working hard in her undergraduate studies, she’s also a conscientious philanthropist who is trying to raise a paltry $200 for Relay for Life (a program run by the American Cancer Society).

What do you think: With my social capital, would it be possible to leverage enough microdonations to blow Rachel’s $200 goal out of the water? She has $15 at this very moment. If ten percent of my Twitter followers donate $5 each, she’d come close to trippling her goal. If influencers retweeted this request – what would happen then?

So, let’s start this little experiment and see if the concept of social capital works for something like fundraising through microdonations: Click here to go to Rachel’s fundraising page, and click here to see clickthru stats from Bit.ly.

Needless to say, cancer patients, doctors, researchers, Rachel, and I would all appreciate any retweets, reposts, or link love you care to give!

Jolie O’Dell is a designer, writer, and consultant based in Richmond, Virginia.

NY-based TickerHound has announced a new partnership with the NASDAQ today. The partnership brings the TickerHouse Q&A service to a new subdomain on the NASDAQ site (answers.nasdaq.com). TickerHound describes their service as, "an open platform for investors to help other investors we hope to help you take your financial knowledge to the next level."

The new answers site (seen below) provides a way to ask questions in a very simple way. NASDAQ is featuring the answers site on the main site which should help drive visitors and usage. It appears you can earn points for answering questions which can then be redeemed for big stuffed animals (ha). Founder Wayne Mulligan has posted his thoughts about the launch. Wayne notes that more partnerships are in the works. Financial terms of the partnership were not disclosed although there are a number of ads on the answers site.

A couple of new mobile applications launched today that I thought were worth mentioning.

SmartyPig

SmartyPig offers a social savings site and almost reminds me of the Christmas Club accounts at my old bank when I was a little kid. The idea behind SmartyPig is to help you save a little each period to help you get to the goal and purchase the product you are interested in. Say you want to buy a new iPod, you can set it up so SmartyPig takes $15 each week and then the system alerts you when you’ve reached the needed $299 for the iPod. They also pay interest on your account balance and say that the money is FDIC insured. Interestingly they quote the interest rate as just over 3% which is way higher than most offerings today. They also offer bonuses if you buy the item via one of their partners including Amazon and Home Depot.

The mobile application offers the basic monitoring functionality and also the ability to drop in additional monies into your account. The example SmartyPig uses is that you decide to go get a double frap lattee with a shot of mocha. Instead of the double you go for a single and save $3.00 and drop that into your SmartyPig account. I like this concept because it can help you reach your goals quicker and maybe help to change your thinking. The SmartyPig mobile app works on a variety of devices including the iPhone, iPod Touch, Android G1 and the upcoming Palm Pre.

Coovents

We reviewed NYC-based Coovents when they launched. Coovents provides a listing of happy hour locations in NYC which you can access on their website or via their text messaging service. Today they have announced the launch of an iPhone application.

The iPhone application allows you to find based on where you are currently located. This is pretty neat – so imagine you just finished a three-hour meeting with your vc and they decided not to give you the additional $5 million you need to keep going. You want a beverage bad…you whip out your iPhone, load up the Coovents app and find out that right around the corner you can get two-for-one Buds.

Note: I provided Coovents with a couple subscriptions from my startup for a giveaway they ran.

Just a week after announcing a $12 million series B venture capital round, social lending company Lending Club has announced a new partnership with EntrustCAMA. The new partnership will allow lenders to use monies from their IRA retirement accounts as funding sources for loans made on Lending Club.

Renaud Laplanche, CEO and Founder of Lending Club said regarding the launch, "Now investors have more choice for their retirement accounts beyond traditional asset classes."

EntrustCAMA will serve as the administrator for the accounts. Check out the full press release which includes links about the program. Clearly there are a lot of pros and cons about using your retirement account in this manner and the best advice I could give you is to speak to someone who fully understands the retirement account market and can guide you and your monies.

P2P social lender LendingClub has announced they have raised $12 million in a Series B round of funding. Morgenthaler Ventures led the round and is joined by existing investors, Norwest Venture Partners and Canaan Partners. Renaud Laplanche, Lending Club’s CEO and Founder noted, "This additional capital will allow us to continue to expand our capabilities and accelerate the growth of our customer base." The company has raised just over $28 million to-date.

Lending Club has also announced Pamela Kramer as the company’s first CMO. Pamela has spent the last two decades in the online financial space.

Interestingly enough, p2p lending news caught a twitter message from LucHardy, president of Sagax, a venture capital firm. The message, posted on Tuesday, noted the funding amount but was quickly deleted.

p2p lending news has another post that is well worth reading which has a lengthy breakdown of the loans that Lending Club is currently funding. Lots of charts and graphs along with their analysis on the lending. They note that 24% of the loans Lending Club makes come from them versus the p2p community. I can’t comment on this as it’s not my area of expertise but the information came from the SEC filings that Lending Club is required to make.

Check out all of our social lending coverage including our interview with Renaud.

Online financial services site Wesabe has announced the launch of SpringBoard today. SpringBoard is basically a white-label version of Wesabe’s tools and services that banks and other financial institutions can tie into to make mashups that will benefit the end consumer. Back in November Wesabe partnered with The Telegraph newspaper in the U.K. to create a similar personal finance site.

Colin Henderson describes the SpringBoard launch an application suite. Colin spoke with Wesabe CEO Marc Hedlunch regarding the launch. Marc noted that every transaction makes Wesabe smarter. If that’s the case, any partnerships with banks will make Wesabe brilliant.

Basically the banks and credit unions can either tie into Wesabe using their APIs or the full personal finance site similar to the Telegraph implementation I noted above. The service could be a great value add for the smaller independent banks which appear to still be doing well financially and could help these banks compete with the larger national banks with a better suite of services.

Last month competitor Geezeo launched a white-label service, Geezeo Spectrum.