Back in the heady days of early 2015 the marketplace lending industry was running at full throttle. Every company was growing fast and raising money at fantastic valuations as there seemed to be a bottomless pit of funding available for everyone.

It was against that backdrop that Prosper raised $165 million in April 2015 in a funding round that valued the company at a whopping $1.865 billion. As we now know the industry came crashing down to earth in 2016, the money dried up and valuations went down. Good companies have still been able to raise money but often at lower valuations than in 2015.

Earlier this week Prosper closed on a Series G transaction where they raised $50 million from an investment fund co-managed by FinEx Asia and LPG Capital based in Hong Kong. While Prosper would not confirm their new valuation sources said the post money valuation was $550 million. This represents a 70.5% drop in value from their high in 2015. So the rumors from last month are true.

At first glance one might think this is a bit of a disaster for the company to have dropped in value so much. But let’s look at Prosper’s closest competitor, Lending Club, for comparison. On April 2, 2015 Lending Club was trading at $19.26 a share. Yesterday the shares closed at $6.10 which is a 68% decline in valuation. This is pretty much in line with the decrease in valuation at Prosper.

Here is what CEO David Kimball said of this funding round:

This investment is a strong signal of confidence in our business fundamentals and the momentum we are seeing right now. Over the past year, we’ve shown that we can build a sustainable business that continues to redefine the online lending experience for our borrowers and investors. We believe this partnership will open up additional opportunities for our business as we continue to grow.

A spokesperson for Prosper told me that the money will not be used for operations but rather for new projects. Prosper is now cash flow positive with liquid assets of around $42 million as of Q2 2017. There was no dire need to get this funding round done but it will be helpful for them as they look to grow in a sustainable way.

My Take

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It was exactly five years ago today that I launched Lend Academy. Well, actually back then the site was called Social Lending Network with a different URL (www.sociallending.net). I rebranded the site to Lend Academy in 2012. Anyway, I officially launched my P2P lending blog on November 30, 2010.

Today, I am going to reflect a little on what the industry was like back then and the changes we have seen over the past five years.

I launched Lend Academy with a three part series on the State of P2P Lending in the USA. The first part focused on Lending Club and Prosper, part two was on emerging companies and part three focused on student loans (pre-SoFi and CommonBond). Going back and reading these three posts reminds me just how very far we have come in five years.

Back in November 2010, Lending Club had issued less than $200 million in total loans and was focused primarily on retail investors. Prosper had issued more loans than Lending Club (just over $200 million) and they still operated under the reverse auction model, although they would move to the fixed price model the following month.

When I started writing about this space I did it because I was personally invested and I loved the whole idea of P2P lending. I had no background in finance but I had recently sold my business and I was looking for a career change. I had always enjoyed investing and I felt like P2P lending had a lot of potential. Although I must admit I had no idea it was going to take off the way it has.

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It has been almost three years since Lend Academy has received a visual makeover. And to be honest, the site still looked very similar to when I launched it back in 2010.

Needless to say, it was overdue for a redesign. And while a makeover has been on my to-do list for over a year now, the final push came when I received an email from Google a couple of months ago telling me that we needed to fix the mobile usability issues they found.

The problem was that Lend Academy did not have a responsive design and therefore did not look that great on a mobile device. So, we have implemented a new theme that looks great on all devices. If you are reading this in your browser go ahead and resize the window now or fire up LendAcademy.com on your phone.

The design you see here is just Phase 1 in what will be a major overhaul of LendAcademy.com this year. Phase 2 will add many new features and will make Lend Academy much more of a 21st century news and information site.

Let me know what you think of our new design. I would love to get feedback whether you love it, hate it or are indifferent.