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My Quarterly P2P Lending Results – Q2 2014

by Peter Renton on August 19, 2014

One of the many things I love about this business is its transparency. Anyone can download the entire loan history of Lending Club and Prosper and see how every single loan has performed. It is in this spirit of transparency that I bring you details of my own p2p investment returns each and every quarter.

This past quarter marked my five-year anniversary of investing in p2p lending. I started with just $500 and as I have become more comfortable with this investment I have added more money. Today, I have a very high level of comfort so I continue to add new money here. I have been slowly taking money out of the stock and bond markets and putting it to work in this industry.

Overall P2P Lending Return Now at 11.87%

Before I get into the details of my returns I want to give a quick overview for newcomers. I have had six accounts, four at Lending Club and two at Prosper for several years. These accounts have formed the core of my p2p lending portfolio and their results can be tracked back to the fourth quarter of 2011. Last quarter I introduced two new accounts into the mix. In February I opened a Prosper SMA account through Lend Academy Investments, my new wealth management firm, and last year I invested in the Direct Lending Income Fund, a fund that invests in small business loans.

Below is the quarterly table of all my p2p lending investments. I have continued to separate these two new accounts from the six established accounts – mainly so I can continue to track the overall returns of these core accounts. Speaking of which, last quarter was my first overall decline for my core accounts since I switched to a more aggressive investment approach three years ago. My overall return for my core accounts went down from 11.87% to 11.15%.

This was not unexpected although the magnitude of the drop did surprise me somewhat. Most of my core accounts had a larger than average number of defaults this past quarter, which led to lower returns across the board. You can see the details in the table below. You can see the table at full size and you can view the table with the extended return percentages here.

P2P-Lending-Returns-Q2-2014 Summary

As you look at the above table you should take note of the following points: [click to continue…]

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Peer to Peer Lending News Roundup – August 16, 2014

by Peter Renton on August 16, 2014

During the week I share the latest p2p lending news on Twitter as it happens. Then every Saturday I take the most interesting news items and blog posts from the past week and share them here.

I have been in London this week doing some prep work for LendIt Europe so I have been a little more quiet than usual on the blog and Twitter. But I have been getting caught up this morning and there were many interesting articles this past week so you will have plenty of good stuff to read this weekend.

The Lending Model That Bypasses the Bankers from National Journal – Thoughtful article by The Atlantic writer William Cohan on the state of our industry. He raises an interesting possibility: “that the six largest credit-card issuers in the United States…have been acting like a cartel”. Read the article, it was the most interesting of the week in my opinion.

Small-Business Lender OnDeck Prepares to File for IPO from The Wall Street Journal – While everyone in this industry has been focused on the Lending Club IPO, OnDeck has been quietly preparing to go public.

The Price of Credit – Interest Rates Over Time from Orchard - Fascinating to see how the interest rates for Prosper and Lending Club have converged over time.

Peer-to-peer lending ‘here to stay’: Zopa CEO from CNBC (video) – Interview with Giles Andrews, CEO of Zopa, on the state of p2p lending in the UK.

LendingTree’s Personal Loan Revenue Exceeds $1 Million in July (press release) – LendingTree is a major source of borrowers for both Prosper and Lending Club.

Prosper Form 10-Q from the SEC – The quarterly financials from Prosper showed them basically at break-even in the second quarter on $16.5 million in revenue.

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Two Significant Reports Just Published on P2P Lending

August 15, 2014

Yesterday, two major reports were published on the p2p lending industry. First, the Federal Reserve Bank of Cleveland put out a positive report on the future potential growth of this industry and the same day Fitch Ratings published a more sobering report on where the p2p lending industry stands today. Both make for some very [...]

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Peer to Peer Lending News Roundup – August 9, 2014

August 9, 2014

During the week I share the latest p2p lending news on Twitter as it happens. Then every Saturday I take the most interesting news items and blog posts from the past week and share them here. How a Personal Loan Can Help You Beat the Post-Grad Plateau from SoFi – Very interesting to see the student loan platform, [...]

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LendIt Europe on November 17 is Now Open for Registration

August 7, 2014

The first LendIt Europe conference is happening in London on November 17th, 2014. After putting on two successful conferences in this country over the past two years and co-hosting a conference in Shanghai we are now going to the birthplace of this industry. We opened LendIt Europe 2014 for registration last night. As many of [...]

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LAP21: Tracy Alloway of the Financial Times on Covering the P2P Lending Industry

August 5, 2014

We have a different type of guest in this episode of the Lend Academy Podcast. Tracy Alloway is a journalist based in New York who covers the banking industry for the Financial Times, the leading UK financial newspaper. She has also taken a keen interest in the peer to peer lending industry in this country [...]

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Peer to Peer Lending News Roundup – August 2, 2014

August 2, 2014

During the week I share the latest p2p lending news on Twitter as it happens. Then every Saturday I take the most interesting news items and blog posts from the past week and share them here. UK P2PFA: Peer to Peer Lending Goes to Over £1 Billion in 2014 from Crowdfund Insider – The the UK p2p lending [...]

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Prosper Originates $154 Million in New Loans in July

August 1, 2014

Prosper continued their strong year in July with $154 million in new loans issued, up from $146 million in June and just $30 million in July last year. The growth this month slowed to 5.6% month over month which I think is a good thing. It is difficult to grow 20-40% month over month for [...]

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New P2P Startup Funding Veteran Owned Small Businesses

July 30, 2014

According to the US Small Business Administration veterans made up 9.1% of all small business owners in 2012. This represents 1.7 million small businesses, many of which have funding needs. This is the population that Mark L. Rockefeller and his team will be targeting with their new startup called StreetShares. Rockefeller is a veteran himself, [...]

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Peer to Peer Lending News Roundup – July 26, 2014

July 26, 2014

During the week I share the latest p2p lending news on Twitter as it happens. Then every Saturday I take the most interesting news items and blog posts from the past week and share them here. Exclusive: Ron Suber on Creating a P2P Investor Base from Scratch from LendingMemo – Great interview with Ron Suber, President of Prosper, [...]

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