I’m very proud to introduce Insikt, the company we’ve been building for two years, and announce that we’ve raised over $100 million in capital, with $16 million in Series B financing led by Revolution Ventures.
First, what is Insikt and where did our inspiration come from?
Insikt (pronounced “in-seekt”) is a white label loan origination and investing platform that enables any brand to lend to its customers and any accredited investor to invest in consumer loan portfolios.
Insikt was born out of our realization that banks will not be the lenders of tomorrow – brands will. Traditional banks, saddled with new rules and regulation, are no longer in the business of taking risk and making loans and cannot be relied on to deliver credit access and opportunity to the masses. Instead, tomorrow's lenders will be media companies, retailers and prominent brands that have deep relationships with their customers and want to step in to help their customers get a fair loan. But, to do it right, they need scoring, servicing, technology and capital — all of which are expensive and difficult to build. So, why build it if you don’t have to? This is the future of lending. Any brand or company can be a lender. We've launched "Lending as a Service" (LaaS) to power this transformation.
Insikt was also born out of our belief that access to affordable and fairly priced loans is opportunity, and that access to opportunity should not be limited to people with high incomes and FICO scores. Personally, it pains me to read about working class people spending $4,500 to buy a $1,500 couch because they have no other options. I founded Progreso Financiero in 2005 to solve this problem for the Hispanic community. We did an amazing job revolutionizing credit access to hundreds of thousands of Hispanic families at affordable rates and with low losses. But, why stop there? Insikt is an expansion of the belief that all people deserve access to affordable loans based on more than their credit score and whether or not they have a banking relationship. Our LaaS model enables us to partner with brands that have national reach online and across thousands of branches so we can improve the lives of millions while also raising the bar on lending and opportunity in America.
Finally, success should not be limited to borrowers. There are millions of private investors across the country that want to share in that mission, and at the same time, are tired of earning 0% on their money in banks. Consumer loan portfolios can provide attractive, stable returns, but investing in loans is not easy and not without risk. First, access is hard. Where does one go to invest in multiple loan portfolios? And, how do you keep track of credit quality and ensure that we are all marching in the same direction? Instead of investing directly in loans, Insikt allows accredited investors to participate in bonds backed by distinct loan portfolios that Insikt credit scores and processes. Insikt always puts its own skin in the game to ensure alignment with investors around high quality lending and to provide investors an extra layer of protection. Investors also have full access to data, down to loan level details. Transparency, simplicity and alignment are our governing principals. Insikt aims to do securitization the right way and make consumer loans a mainstream asset class for accredited investors.
Who are we and what have we accomplished so far?
The Insikt team comprises a number of people who helped me build Progreso Financiero to what it is today plus many new ones. We have deep credit experience from the big names – Capital One, Chase Cards, HSBC, Providian and Experian – and also new innovators such as Prosper and Intuit. We also have deep experience in structured finance from high quality institutions such as Fortress Investment Group and Morgan Stanley. We all share a passion for opportunity, transparency, and driving the next wave of innovation in finance.
We launched our loan origination platform, Lendify™, earlier this year to help brands offer their customers loan products. Lendify is cloud-based and available to organizations wanting to extend and deepen their relationship with customers by offering high quality loans. Through Lendify, any retail store, online brand, or even bank can make loans or provide purchase financing to its customers in its own brand name without any prior lending expertise, upfront investment, or balance sheet capital. Using big data principles, Insikt leverages thousands of attributes to deliver the right product to customers, especially working class Americans who need credit the most. Lendify is beginning to be deployed by partner organizations and the response has been amazing. We expect to begin announcing our partners in the near future.
We also launched our investor platform by buying and securitizing loans that meet our credit criteria from our partners in the peer-to-peer market. This has enabled us to create a better experience for accredited investors who want to buy bonds backed by distinct loan portfolios instead of individual loans. To date, we’ve completed three securitizations and are gearing up for our fourth in December. We’ve also launched three fixed income LP funds for accredited investors who choose to invest through a managed approach. Altogether, securitizations and capital in our funds will reach over $40 million this month.
$100 million in capital: $16 million Series B led by Revolution and over $70 million from multiple lenders and bank partners.
We are off to a great start and very grateful to our partners and investors for believing in us. To date, we’ve raised over $100 million and recently closed a Series B led by Revolution Ventures. Existing investors Firstmark Capital (who led our Series A), Serengeti Asset Management and Peterson Ventures joined strategic investors Jefferies and Atalaya Capital Management to complete the round. We are also proud to have an incredible group of angel investors including Phil Purcell (former CEO Morgan Stanley and co-founder Discover), Mark Troughton (former president Green Dot), Tom Villante (CEO of Yapstone), Pete Briger (co-chairman of Fortress Investment Group), Jason Fish (founder of Capital Source), Tim Dattels (managing partner TPG Asia), Dan Carroll (former TPG Capital partner), and Matt Coffin (founder of LowerMyBills) to name a few. On the debt side, we've partnered with a large national bank and Northeast Bank to support our efforts in the peer-to-peer market, and Atalaya Capital to help fund Lendify's growth.
Stay Tuned. We’re just getting started.
The next wave of finance is about broader credit access, prominent brands offering loans, and banks partnering to get back in the business of making loans. It’s about doing securitization the right way and giving accredited investors a new curated, asset class to invest in. We are still in the early innings, but intensely focused on quality and being here for the long haul. Stay tuned…