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Warren Buffett Makes A Huge Investment in Lending Club

by Peter Renton on April 1, 2013

[Update: The following story is not true. Warren Buffett has not made an investment in Lending Club. So if you are just stumbling across this article you should keep in mind that it was published on April 1st.]

Big news out of Lending Club this morning. The world’s leading investor, Warren Buffett, has invested $150 million in to Lending Club for a 10% ownership stake that values the company at a whopping $1.5 billion.

This is a coup for Lending Club in so many ways. Buffett is simply the biggest name in investing today and brings with him unparalleled knowledge and experience. There is no one with more finance credibility and this will certainly help raise the profile of both Lending Club and p2p lending worldwide.

This is not Buffett’s first foray into financial services. His company, Berkshire Hathaway has a large stake in American Express, MasterCard, US Bank as well as his new stake in Goldman Sachs that was announced just last week. Clearly, with his latest investment he is aligning himself with a company that could well be at the heart of financial services in the future.

The last cash infusion that Lending Club received was back in June of last year and that valued the company at $540 million. Buffett’s investment means that the value of Lending Club has tripled in less than a year. Given that he is known as the consummate value investor Buffett must believe that at a $1.5 billion valuation Lending Club is still a bargain.

Lending Club has agreed to expand their board from their current eight members to nine to allow Buffett a seat. That is a no-brainer; you want this guy in your board meetings.

I have reached out to the office of the Oracle of Omaha for comment but have not heard back as of this writing. If I ever hear back I will update this post.

photo credit: Fortune Live Media via photopin cc

{ 16 comments… read them below or add one }

Greg April 1, 2013 at 4:14 am

I call April fool!

The sage would never take a board seat on such a small investment.

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Peter Renton April 1, 2013 at 5:59 am

I wondered about adding that little board seat tidbit. But yes, you called it – the above piece is a work of fiction in honor of the silliness we call April Fools Day.

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writing2reality April 1, 2013 at 6:38 am

Haha good stuff Peter! :)

Happy April Fools to you as well!

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Peter Renton April 1, 2013 at 9:31 am

Thanks!

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Fred April 1, 2013 at 9:30 am

You got me :(

Reply

Peter Renton April 1, 2013 at 9:32 am

Well I did try and make it believable and read like a legitimate post. But alas I don’t believe Warren Buffett is that interested in p2p lending….yet.

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Dan B April 1, 2013 at 5:59 pm

Interested in it? I wouldn’t be surprised if he barely knows what it is.

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Neal S. April 1, 2013 at 10:30 am

Dang. Hook, line and sinker.

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Meggie April 1, 2013 at 5:42 pm

Read at 4am after being up all night and totally bought it. Nice work.

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Mike April 1, 2013 at 5:54 pm

Got me too!

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Dan April 1, 2013 at 6:24 pm

Didn’t fool me one bit. Not even close but thanks for the laugh. ;)

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Chris April 1, 2013 at 8:42 pm

You got me haha. Happy April Fools Day.

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Kowser April 1, 2013 at 11:05 pm

I’ll scour all of Denver to find you!

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Martin April 6, 2013 at 1:17 pm

This is a great article. I am still drying my tears. Good Fools day post. Love it!

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Dividend Growth Investor April 6, 2013 at 8:16 pm

That is a great April Fool’s day joke. I sincerely wish you that one day the joke is on you, and Berkshire Hathaway does invest in LC .

Dividend Growth Investor

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Peter Renton April 7, 2013 at 12:10 pm

I hope you are right. I would love for the joke to be back on me one day. Mind you, I think Lending Club would have to grow several orders of magnitude larger than it is now for Buffett to be really interested.

Reply

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