Renaud Laplanche’s comeback venture raises $62 million

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Upgrade, an online marketplace lender started by the founder of LendingClub, recently raised an additional $62 million in equity capital to fund its growth plan.

One of the next items on Upgrade’s agenda will be a credit card product its customers can use to draw on their personal lines of credit with Upgrade, CEO and co-founder Renaud Laplanche said.

“Right now, the way you use a customer credit line is by going to your phone, and you can draw $500, and it shows up in your bank account. We want to provide an Upgrade card where swiping the card will draw on the line, and it’s also a tokenized card, so you can keep it in your digital wallet,” he said in an interview. “That’s really one issue that we want to take on quickly and make the customer credit line as usable and convenient as possible.”


Upgrade launched the personal credit line product this year, and annual percentage rates on that product range from 5.16% to 35.89%. The company also offers a personal loan and a credit monitoring product, but Laplanche said he ultimately hopes to address all of its customers’ credit needs, from credit cards to auto loans.

Upgrade will invest in better tools for its credit analytics, risk management and compliance functions and may do some additional hiring in those areas, he said. Based in San Francisco, Upgrade has three other offices in Phoenix, Chicago and Montreal, and more than 300 employees.

Upgrade faces stiff competition in the online lending space, and not just from other marketplace lenders like Prosper Marketplace, SoFi and LendingClub. Banks have also gotten into unsecured consumer lending in recent years. Goldman Sachs, for example, launched an online consumer lending platform in the fall of 2016, and the London-based Barclays rolled out an online personal loan product last year.

Laplanche founded Upgrade in August of 2016, just a few months after he was forced out of Lending Club because its board had discovered that executives had falsified certain loan information.

He said he hopes to differentiate Upgrade from LendingClub by establishing a more ongoing relationship with its customers, part of the reasoning behind its credit monitoring product.

CreditEase Fintech Investment Fund lead the company’s latest financing, a Series C round, and its managing director, Anju Patwardhan, will now join Upgrade’s board of directors.

“We believe Upgrade will grow into a mainstream consumer credit brand that is dedicated to helping consumers better understand their credit and encourages responsible credit behavior, and we are excited to be part of the journey,” she said in a press release Thursday announcing the new funding.

Upgrade has raised a total of $142 million in equity capital since its founding. All of its major investors, including Silicon Valley Bank and Union Square Ventures, participated in this latest round, which included the conversion of all previously issued convertible notes.

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