prosper.com microfinance - svmn.net mtg 2007-09-10
DESCRIPTION
Prosper.com presentation at 9/10/07 SVMN meeting.TRANSCRIPT
Prosper Marketplace
2
Prosper is like an “eBay for Money”
• Marketplace for money– Brings together borrowers with people who have money to lend– Administers lending process including payments and collections
• New asset class– Anyone with as little as $50 can lend– Community decides where and why to grant credit
• Leverages power of community– Groups and endorsements provide shame, acquisition and support
3
Institutional Markets - Wall Street
Existing Consumer Credit Markets
Community Lending - Early US S & L’s - Informal Asian Lending
= Borrowers = Lenders
• Good: borrower shame/loyalty• Good: low marketing costs• Bad: risky - no diversification
• Good: great diversification• Bad: no borrower loyalty• Bad: high marketing costs
4
Prosper combines best of both markets
= Lenders = Borrowers = Group Leader
Lenderdiversification Group
Leadermarketing
Borrowerreputation
Friends,Endorsements
reputation/marketing
5
Market Size – Unsecured consumer credit
• $900 billion US credit card market
• Announced Japan JV - $200 billion market
Source: SMR Research 2005 and
Financial Services Agency of Japan 2006
$886 $923 $962 $1,002
$-
$200
$400
$600
$800
$1,000
$1,200
2006 2007 2008 2009
year
(billio
ns)
6
Prosper Stats
Users: 410,000
Loans by $: $87,000,000
Borrower Loans: 15,000
Promissory Notes: + 1.2 million
Payments to Lenders: 2,500,000
Discussion Posts: 370,000
7
Backing
• VC Backing– $40 million raised
• Outside Directors– Jim Breyer, Accel Partners
• Wal-Mart, Facebook
– Bob Kagle, Benchmark Capital• eBay, E-Loan
– Larry Cheng, Fidelity Ventures• Verid Board
– Paul Hazen• Former CEO Wells Fargo
8
Listings
9
Listing Summary
10
Group Information
11
Endorsements from Friends
12
Bid History
13
Deep Operational Integration
Scheduled: June ‘07
Scheduled: Fall ‘07
Banking and Finance
Collection Agencies
Credit Reporting AgenciesAnti-Crime Scheduled: Fall ‘07
14
First Wave (Web 1.0)
• What was New:– Streamlined existing processes– Value creation = disintermediation
• What was the Same:– Source of value was the company– Company dictated the product
• What was New:– Streamlined existing processes– Value creation = disintermediation
• What was the Same:– Source of value was the company– Company dictated the product
Offline Online Product Books
Stocks
Loans
15
Second Wave (Web 2.0)
• What is New– The Source of Value changed
• The Company The People
– The Company’s Role changed• Central Role Supporting Role
– The Exchange of Value changed• Company-to-People People-to-People
• What is New– The Source of Value changed
• The Company The People
– The Company’s Role changed• Central Role Supporting Role
– The Exchange of Value changed• Company-to-People People-to-People
Web 1.0 Web 2.0 Product Video
Guides Loans
16
But what about all the other Web 2.0 Stuff?
• XML• AJAX• ASP• RSS• Wiki• SOAP and WSDL API’s • Big Rounded Logos
X No People
= No Value
17
What if there were no people?
18
Range Of Issues
• State licensing requirements • State usury and fee limitations • Securities laws – state & federal • State disclosure requirements and other lending regulations • Truth in Lending Act • Equal Credit Opportunity Act/discrimination laws• Fair Credit Reporting Act • Fair Debt Collection Practices Act/state collection laws • Electronic Funds Transfer Act • E-SIGN Act/Uniform Electronic Transactions Act/UCC Article 3 • FTC Act and Unfair and Deceptive Trade Practices Acts • Federal (Gramm-Leach-Bliley Act) and state privacy laws • Data security laws • Bank Secrecy Act/USA PATRIOT Act/OFAC • Money Transmitter Licensing • Federal Deposit Insurance • Bankruptcy • Tax • Website agreements and disclosures • ACH authorizations• Communications Decency Act