As the sun sets on another year I like to look back and think about the biggest news stories of this year. And what a year it was. There were so many firsts it was hard to cull the list of stories down to just five.
But here are my top five news stories of 2014 in chronological order.
When I received a call from Lending Club back in April announcing some big news I was expecting it would be IPO related but I was completely wrong. Lending Club made their first acquisition, a traditional lender called Springstone Financial, that specializes in loans for dental patients as well as private school education. This was a milestone for Lending Club and our industry in general as it was the first significant acquisition by any platform. To pay for this acquisition Lending Club raised $65 million in equity that valued the company at $3.76 billion.
The global leader in online small business lending raised this major funding round over the summer, more than doubling how much they had raised to date. This round put Funding Circle in a very strong position in the two markets it operates in: the USA and UK. It dominates online small business term lending in the UK where it does more loans than the rest of the industry put together.
This was a groundbreaking deal in many ways. CircleBack Lending, despite having roots that go back more than six years, was very much a startup in this space when then they closed this deal in September with Jefferies, the investment bank. It marks the biggest single commitment in the marketplace lending industry from any one source. And it put CircleBack Lending on the map as a potential strong number three player.
This story was not picked up at all in the general press but I think it warrants coverage as one of the most significant stories of 2014. After burning through well over $100 million in venture money Prosper turned the corner in the third quarter of this year and made their first quarterly profit. What the new management team has been able to achieve in less than two years on the job has been nothing short of extraordinary.
We had been waiting patiently for this day for almost two years, since CEO Renaud Laplanche first announced publicly that Lending Club would be looking to do an IPO. The amount of coverage of this news story was staggering. During the week that Lending Club went public I think there were more stories written about this industry than in the combined nine year history of this industry. The IPO was a seminal moment for everyone involved in P2P lending and was clearly the biggest story of the year.
There were certainly other stories that could have been mentioned here. We had the recent OnDeck IPO, some in depth coverage in the New York Times and an entire book could have been written from all the articles that were published in the lead up to the Lending Club IPO. But those five developments are what I consider to be the most important stories of 2014.
Happy New Year everyone. I look forward to an exciting 2015. Speaking of which, you are going to see a lot of changes at Lend Academy this coming year as we begin to expand our coverage of this dynamic industry.