One of the companies the LendIt Fintech team has always held in high regard is LendUp. They are tackling a difficult problem, access to credit for the underserved, by leveraging the latest technology. This involves a whole different set of challenges than serving the prime and super prime market. They have offered short term loans and more recently a credit card for the non-prime market.
Today, LendUp announced that they are splitting the business in two. LendUp will focus on the company’s more established and profitable personal loan business which also includes consumer education. A new company has been formed called Mission Lane which will hold the credit card business, and that business’ portfolio, IP, and technology platform. The credit card business includes the popular Arrow and L cards. These cards have received high accolades from customers compared to other subprime credit cards which often are coupled with high fees.
Mission Lane is receiving a capital injection from Invus Opportunities and LL Funds LLC who are leading the investment along with participation from QED Investors. LendUp launched their card business more recently and the new capital structure will allow this segment of the business to grow. The companies will have separate technology platforms and it remains to be seen whether the customers of each will be cross marketed to. Along with these changes is a shuffling of staff between the two businesses.
Here are a few of the major changes:
- Anu Shultes, previously GM of LendUp will be appointed LendUp CEO.
- Sasha Orloff, LendUp’s co-founder and CEO is stepping down, but will remain a board member of LendUp and will be involved in Mission Lane as an advisor.
- Vijesh Iyer, previously LendUp’s COO has been named interim CEO of Mission Lane as they search for a permanent CEO
- Other previous LendUp executives including LendUp co-founder Jake Rosenberg, Eric Nelson (operations) and Leonard Rosemen (data science) will also be joining Mission Lane.
While this news was just announced, the Mission Lane webpage gives us a glimpse of what the new brand will look like. We wish everyone from LendUp and the newly formed Mission Lane the best of luck as they move forward as separate entities.