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It’s hard to believe it is December already. It’s been a couple of months since my last post, as we’ve been heads down and working hard on our platform as we plan for growth and increased originations. As you can imagine, we are excited about what we’re seeing on both the borrower and lender side of our marketplace. Although I was unable to get an October update up on the blog, we saw our biggest month ever in originations in that month – $50 million – and I am happy to report that November was another successful month with almost 10% growth in daily average originations over October.

In March, when I published my first monthly update here on the Prosper Blog, originations were $15.1 million for the month. This was a 60% increase over the previous month and just the beginning of the immense growth we’ve seen this year. November closes with over $46 million in loan originations, a 205% increase over March, 2013, and an astounding 369% increase over January, 2013 when the new management team took over.

By focusing on daily average originations and not trying to manage to a monthly gross originations number, we are aligning our interests with both our borrowers and lenders. Loans are originating as they fund on the platform – allowing for speedier funding for borrowers and faster bid to origination times for lenders. As of now, we are averaging only 4 days from the creation of a listing to origination (money in the borrower’s account), making us the fastest in the industry.

As a result of our strategy of not managing to a monthly growth number, you may see variable growth when looking at monthly originations based on the number of origination days in a month and some other seasonal factors. However, as you can see in the graph below, we have seen a 10% increase in daily origination numbers through November.

Daily originations chart

On a quarterly basis, with one month left, we see Q4* positioning upward still! We are excited about this increase moving into December.

Originations by quarter chart

We continue to make major improvements to the borrower experience. Over the past two months, we have built and launched a new feature that enables our borrowers to upload scanned documents directly to the website during their loan application process. Since the launch of this new feature, we have seen documents supplied more immediately, and, consequently, we are able to speed up our verification process and fund loans more quickly. See a review by Orchard on the improvement to this process. We expect an increasingly positive impact of this new functionality on the month’s performance as the process continues to improve.

You may have noticed some intermittent changes in the loan posting schedule over the past couple weeks. This is as a result of the recent borrower changes mentioned above. We are working to smooth this out, and things should be back on a regular schedule soon.

In light of recent growth, we are honored to have our parent company, Prosper Marketplace, ranked on two lists that recognize fast-growing private companies.

  • Ranked 12th on the “Fast 100,” a list of the fastest growing private companies in the Bay Area by the San Francisco Business Times. Prosper Marketplace earned its ranking on the October 2013 list with 532% revenue growth between 2010 and 2012.
  • Placed on the 2012 Inc. 500/5000, a list of the fastest growing private companies in the country.

Thanks, as always, for your feedback, comments, and suggestions. We appreciate hearing from you and are very excited about the future.

Aaron Vermut
President, Prosper Funding LLC


12/03/2013 by in Featured, Lenders, Prosper News

Momentum Continues with 7th Consecutive Record Month, New Partners, Product Innovations, and More

September was another eventful month for Prosper. We closed the month with $33.1 million in loans originated through the Prosper platform, marking the 7th straight month of record-setting loan originations.

Last month, I mentioned a series of changes made to the Prosper platform that we anticipated would have a positive impact overall. In September, we had the opportunity to see the initial impact of these changes and we are very excited at the results so far. September finished with $59 million in loan requests through the Prosper platform, a 24% increase over July’s loan requests of $47.6 million and our best month yet. October daily originations have benefited from the listing activity in the later part of September and we continue to see more and more borrowers finding loan options that meet their needs.

The two main changes impacting the results are:

  • Improved borrower experience: Early on in September we launched a new borrower onboarding experience that makes it easier for people to come to the Prosper website and quickly make their way through the borrower application process. Part of this change included the removal of the loan description and loan title fields. We have received extensive feedback from our lenders to add these fields back to the borrower application. We appreciate all your feedback and participation in this conversation. We are exploring options that will meet everyone’s needs and I will let you know when I have more information. 
  • FICO 08® score transition: also early on in September, we transitioned over to the FICO 08® scoring model. This change, in conjunction with the Prosper Rating system, has strengthened our credit policy as anticipated. FICO 08® directly aligns us with industry standards and enables us to get more competitive with our rates and offers. Stay tuned for more feedback on the impact of this change. 

We also had some other exciting announcements in September. To name a few;

  • Prosper Raises $25M in New Round: At the end of September, we announced that Prosper raised $25 million in additional funding to accelerate the company’s growth at a time when peer-to-peer lending is attracting a record number of borrowers and lenders. The round, which was led by existing partner Sequoia Capital, also included a new investment by BlackRock, the world’s largest asset manager. You can read more in the media articles linked below.

The New York Times DealBook: Prosper Raises $25 Million in New Round Adding BlackRock as a Backer
VentureBeat: P2P Lending Platform Lines Coffers with $25M in New Funding
TechCrunch: Lending Marketplace Prosper Locks down $25M from Sequoia, BlackRock

  • The Prosper TV Commercial: To get the word out to more people about the great opportunity to borrow through Prosper, we also launched an advertising campaign that will run across various cable channels including CNN, ESPN and Bloomberg. To view the commercial click here
  • Welcome Dr. Elan Amir: Starting this month we have the good fortune to add Dr. Elan Amir to the Prosper Marketplace executive team. Elan joins us as Chief Product Officer. He brings with him a wealth of background and experience in product development, operations, and management. Read his complete bio here

If you’re looking to get involved in the P2P conversations, Ron Suber, Head of Global Institutional Sales for Prosper Marketplace will be speaking at the following upcoming events in October.

Stay tuned for more information and changes to come. Open to questions and comments below. Thanks for reading!

Aaron Vermut
President, Prosper Funding LLC

10/11/2013 by in Featured, Lenders, Prosper News

Addressing the removal of the Loan Description & Loan Details Fields

Addressing the removal of the Loan Description & Loan Details Fields

Some of our lenders have expressed concern with the recent removal of the loan description and loan title fields on the Prosper borrower application. I want you all to know that we hear your concerns. This is something that we are currently testing. We have not made the decision to permanently remove these fields at this time.

I would like to take a moment to explain why we removed the fields and why we believe it will have a strong positive impact for our lenders long term.

  • Created Confusion – In recent user testing, we found that borrowers were significantly less likely to complete a Prosper loan application when they were asked to provide a Loan Description or Loan Title. Borrowers found this question to be intrusive and, in many cases, confusing to their private loan application process. These fields proved to be the biggest drop off point for potential borrowers. We removed them to gauge response for a period of time.
  • Supply and demand – We strive to have an onboarding process that is simple and easy and makes sense to users. The more simple a process can be made, the more potential borrowers we can reach. In order for Prosper to better streamline the borrower application and meet the demand that you all have expressed for new loans, we will consistently make changes to our platform that we believe will positively impact the way users interact with our product and ultimately, the way the platform performs.

Ultimately, we understand your concerns, and we are exploring the best way to meet both the lenders’ concerns and improve the borrowers’ experience at equal measure, including adding the field back in the near future. Standby for updates on this potential change and more as we begin to interpret its impact on our platform.

Aaron Vermut
President, Prosper Funding LLC

09/20/2013 by in Featured, Lenders

Prosper System Upgrade This Weekend

In my previous updates, I have mentioned that we are working on some exciting things here at Prosper this summer. This weekend, the Prosper team worked very hard to implement some much needed improvements and updates to the borrower onboarding experience. We are happy to announce these changes are complete and live on our site. We will resume our normal loan-posting schedule Monday at 9 AM.  With this upgrade complete, we will be in a better position to bring more borrowers on to the platform and provide our lenders with a larger volume of loans to choose from.  The key changes we made are:

  • Transition to FICO 08® Scoring Model: As we mentioned in our blog on this topic that a large portion of the technical upgrade this weekend was the transition to the FICO 08® Scoring model.   Using FICO 08® in conjunction with our Prosper Rating will strengthen our credit policy by more directly aligning us with industry standards and will enable us to better meet borrower expectations with our rates and offers.
  • Improved borrower experience: We’ve recently released an optimized borrower experience on our website which will provide a smoother onboarding process for new borrowers. These changes include increased access points to customer service assistance (added an 800 number for live customer service), fewer field requirements, and a streamlined application process.

Our focus this year has been on building a foundation from which we can provide better service to borrowers and lenders along with scaling the activity on the platform in a more cost effective manner. This update was a critical part of achieving these goals. The Prosper platform will continue to evolve and grow as we understand the needs of our increasing member base.

Thank you for your patience this weekend while we worked on what turned out to be a very large implementation.  Feel free to leave any questions, comments, feedback, etc. below.

Aaron Vermut
President, Prosper Funding LLC

09/08/2013 by in Borrowers, Featured, Lenders, Prosper News

FICO® 08 Score comes to Prosper and what it means for you

Our president, Aaron Vermut, mentioned in his July Monthly Update that we would be replacing our current credit bureau scoring model, Experian Scorex Plus™, with the more widely recognized FICO® 08 Score, the credit score initially created by Fair Isaac Corporation in 1958. The FICO® 08 Score is the most frequently used credit bureau scorecard among lenders in the consumer finance industry. It’s used to help lenders make billions of credit decisions every year.

FICO® 08 credit scores range from 300 to 850. A FICO® 08 Score is calculated by a mathematical equation that evaluates many types of information from a borrower’s credit report. By comparing this information to the patterns in hundreds of thousands of past credit reports, the FICO® 08 Score estimates a borrower’s level of future credit risk. As Aaron mentioned, changing to the FICO® 08 Score and using it in conjunction with our Prosper Rating will strengthen our credit policy by more directly aligning us with industry standards and will enable us to better meet borrower expectations with our rates and offers.

During this transition, there will be a period of time – roughly 30 days – that Notes corresponding to borrower loans scored from both credit bureau models are present on our platform. Any new loan requests created after this change will be scored using the FICO® 08 Score model. Any requests that were initiated or posted before this change will maintain their initial Scorex Plus™ score. Any lender with a custom credit score criteria used in a search will return both FICO® 08 Score and Scorex Plus™ scored listings. Listings that are underwritten with Scorex Plus™ will continue to have the label ‘Credit Score’ on the Borrower’s Credit Profile. Listings that are underwritten with FICO® 08 Score will have a new label of ‘FICO® 08 Score’ which replaces ‘Credit Score’ under the Borrower’s Credit Profile. See the image below for reference.

Important information for AQI users: If you have an AQI that is executing off a saved search with a set filter of ‘credit score,’ and/or ‘Prosper score’, it will be paused with this change. All lenders in this group will be required to log into their accounts to re-enable any saved AQI searches at that time. Look for a separate communication in your email box if you are a member of this group.

API users will not experience any change to the availability of the Experian Scorex Plus™ information.

The change to FICO® 08 Score is scheduled to occur next week. Lenders will be notified on their account page when this change goes into effect. If you have any further questions about the credit score changes, please feel free to contact our lender team at LenderTeam@prosper.com.

Keep checking back here for more information on recent changes and exciting developments at Prosper. Thanks!

08/30/2013 by in Featured, Lenders, Prosper News


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Notice: Blogs and other materials posted on or linked from this page that use the name "Prosper" generally use that name to refer to Prosper Marketplace, Inc. if published before January 31, 2013 and to refer to Prosper Funding LLC if published on or after February 1, 2013.