Articles by deBanked Staff
Ranger Direct Lending Fund Cites Princeton Fund As Source of Woes
September 27, 2017Ranger Direct Lending (Ranger), A UK-listed fund that has invested with companies such as AmeriMerchant/Capify, Biz2Credit, and Blue Bridge Financial, cited problems with the Princeton Alternative Income fund in its latest midterm report. The problems stem from Princeton’s original investment in Argon Credit, an online consumer lender that went bankrupt last December. The judge in the bankruptcy proceeding found that several of Argon’s asset valuation claims were unrealistic when Princeton attempted to secure its collateral. After a settlement, Princeton gained control of Argon’s loans and is servicing them. Meanwhile, Ranger sought to determine the damage that Argon had caused Princeton and was not satisfied with the answers it got, according to reports.
Princeton’s alleged lack of transparency caused Ranger to initiate arbitration proceedings against Princeton this past June. A hearing on the matter is scheduled to take place in November.
Ranger’s Net Asset Value grew by more than 4% in the first six months of the year, yet its share price has fallen to a substantial discount.
“The lack of clarity surrounding this [Argon Credit] impairment and the unwillingness of Princeton to supply detailed information to the Company or Deloitte, the Company’s auditors, led to the qualification of Ranger’s 2016 year-end audit opinion and only served to add to investor uncertainty,” a Ranger report says.
As of June 30, 2017, Ranger reportedly had more than $50 million invested in merchant cash advances and business loans, about 18% of its portfolio.
What Will it Take to Grow OnDeck’s Stock Price?
September 20, 2017OnDeck closed at the exact same price on September 14th as it did on July 20th, $4.58. In between, OnDeck reported one of their best quarters ever (they released their 2nd quarter earnings on August 7th) and experienced a temporary boost to $5. Even then, the stock was 75% down from the IPO price and more than 80% down from their all-time high, yet that too couldn’t be sustained.
In Q2, OnDeck only had a GAAP net loss of $1.5 million and announced that they had expanded their collaboration with JPMorgan Chase for up to four years to provide the underlying technology supporting Chase’s online lending solution to its small business customers.
In the rest of the lending world, optimism is in style. Square is up 121% year-to-date, according to the deBanked Online Lender Tracker and even Lending Club is up 14%.
More traditional finance companies like American Express and Intuit are meanwhile hovering near their 52-week highs, according to the Specialty Business Lending Tracker.
Some of OnDeck’s former employees at least appear to be doing well. Just recently, the former Chief Sales Officer was named COO of CoverWallet, the former Director of External Sales was named Chief Revenue Officer of Pearl Capital and the former Director of Portfolio Management and Credit Operations was named SVP at Breakout Capital.
New CTO at Breakout Capital is Former CTO of Capital One Labs
September 18, 2017
Firoze Lafeer, the former Capital One Head of Tech Fellows Program and CTO, Capital One Labs, is now the CTO of Breakout Capital, a Breakout representative confirmed. Lafeer was with Capital One for five years, most recently running the company’s experimental product & technology incubator and accelerator.
Breakout Capital is a fintech small business lender based in Mclean, VA where Lafeer will lead technology, including scaling their tech platform.
Last month, Breakout hired Robert Fleischmann as Senior Vice President, Strategic Partnerships and Tom McCammon as Senior Vice President, Business Operations. Fleischmann was previously Director of Strategic Partnerships at RapidAdvance. McCammon was previously the Director of Portfolio Management and Credit Operations at OnDeck.
PayPal’s Global Head of Product Comm Joins Lending Club
September 14, 2017Anuj Nayar, PayPal’s global head of product communications, has moved on to Lending Club as VP and head of communications, according to published reports. Nayar was also previously Head of Mac Public Relations at Apple from 2003 to 2008.
At PayPal, Nayar was the primary spokesperson on a range of proactive and reactive issues, according to his LinkedIn profile.
Lending Club has struggled in the PR department since May 2016 when the company’s founder resigned.
Senate Banking Committee to Hold Hearing on Fintech
September 12, 2017The US Senate Committee on Banking, Housing, & Urban Affairs held a hearing entitled “Examining the Fintech Landscape” on Tuesday morning at 10 AM.
You can watch it below
The witnesses include:
Mr. Lawrance Evans
Director, Financial Markets
U.S. Government Accountability Office
Mr. Eric Turner
Research Analysis
S&P Global Market Intelligence
Mr. Frank Pasquale
Professor of Law
University of Maryland Francis King Carey School of Law
Lending Club Launches Its Most Advanced Credit Model Ever
September 11, 2017Lending Club is feeling pretty good about its newest credit model, according to an email that circulated to retail investors this morning. A copy of it is below:
We have launched the most advanced and predictive credit model ever used on the LendingClub platform. It’s the latest in LendingClub’s long history of innovation on behalf of borrowers and investors.
The new model leverages machine learning and 10 years of LendingClub data to better assess and price credit risk. LendingClub has helped 1.5+ million borrowers since 2007; each borrower provides unique insight that we can use in our next decision.
What investors need to know about the new credit model:
• It’s 24% better at differentiating the likelihood of a borrower charging off than the fourth-generation model, and is more predictive than a borrower’s FICO score alone.
• It’s built on a wealth of proprietary data, incorporates more data points for each borrower, uses best-in-class modeling techniques, and uses dozens of new custom attributes that are predictive in assessing risk.
• We expect loan volume to shift toward higher quality grades (grades A and B) because some borrowers will qualify for lower interest rates under the new model, and other higher-risk borrowers, who may have received an offer previously, will be screened out.
• We continue to see lower delinquency rates across grades and terms in the existing loan portfolio than in the second and third quarters of 2016.
We see this credit model as the latest innovation in our continuous enhancement cycle, and one that helps us continue to provide investors with solid risk-adjusted returns. See here for more on what makes the model unique.
Alternative Finance Bar Association Event is Wednesday
September 10, 2017If you’re interested in going, the Alternative Finance Bar Association event on Wednesday is open to both funding company executives and industry attorneys. The New Regulatory Challenges Facing Small Business Lending: Navigating the New Frontier will feature Joann Needleman, Esq., Jane Luxton, Esq. & Tommy Brooks, Esq. from Clark Hill PLC in the NYC Bar Association Offices on 42 West 44th Street in New York City.
To register or for more information, contact Tiffany Diaz at Tiffany@LRohanlaw.com.
The original announcement can be accessed here.
Amos Weinberg and Creditors Relief Are Battling it Out
September 8, 2017A lawsuit filed by a small business against Creditors Relief in April has gone off the rails, according to court documents. Creditors Relief has sought to dismiss the case that attorney Amos Weinberg brought on behalf of a Deli in New York that alleged among other things, that Creditors Relief practiced law without a license and reneged on a contract to settle its debts.
While both sides were disputing the facts, Weinberg suddenly withdrew the complaint on September 1st, a move which did not actually bring the matter to a resolution. Instead, Creditors Relief has still asked the court to dismiss the case with prejudice and to sanction Amos Weinberg for the frivolous pleading in the first place. In its papers, Creditors Relief argues that the lawsuit was brought primarily to harass Creditors Relief and its owner Michael Lupolover and that the complaint asserted material factual statements that were false.
Across the docket, Weinberg attached documents that exposed Lupolover’s previous snafu with a federal regulator while Creditors Relief later filed an exhibit showing that Weinberg had been sanctioned in another lawsuit.
The case is still active with the motion to dismiss and sanction still pending in the New York Supreme Court under index number: 56406/2017 Natures Market Corp v. Creditors Relief LLC
