Bond Street in New York has gotten a commitment from the investment bank Jefferies to purchase up to $300 million of its small-business loans.
The deal, which was announced Wednesday, follows a 2015 agreement under which Jefferies committed to buy $100 million in Bond Street loans.
Bond Street, which was founded in late 2013, offers one- to three-year term loans with annual percentage rates between 8% and 25%. The company targets small businesses that might be able to qualify for a bank loan but are looking for a faster and easier approval process.
“We’ve always tried to play as close to the banks as possible,” Bond Street CEO David Haber said in an interview Wednesday.
In the past, Bond Street offered loans that ranged from around $25,000 to $500,000, according to Haber. Under the firm’s new agreement with Jefferies, its loans will be as small as $10,000 and as large as $1 million.
Jefferies is currently the only buyer of Bond Street’s loans, but the online lender is planning to add a second buyer soon, Haber said.
Bond Street has financial backing from the venture capital firms Spark Capital and Homebrew, in addition to Airbnb co-founder Nathan Blecharczyk.