Prosper wants to create a secondary market in p2p loans

October 31, 2007 | Dan Kaplan

Updated

dock.jpgProsper, the leader in the small but rapidly growing peer-to-peer lending market, has decided to create a $500 million secondary market for these loans.

Currently, you only get money as the borrower pays it back, and can’t withdraw at any time. Enabling secondary trading will allow lenders (or other interested parties) to buy and sell their investments before the term expires. This makes great sense for Prosper: it makes money by charging small transaction fees, and allowing people to engage in many more transactions will just fill its coffers.

The company, which competes with LendingClub and Zopa, has raised a total of $40 million so far, most recently a $20 million round led by DAG Ventures and Meritech Capital Partners.

See our past coverage of Prosper and other players here. Click here for to the SEC Filing.

Bookmark and Share

Photo of Dan Kaplan

About the Author, Dan Kaplan

Once upon a time, Dan considered himself a magazine journalist with dreams of "The New Yorker" and a couple of well-reviewed but only mildly successful books. Then one day, life, as it is known to do, decided it was time for rebirth. Like so many things before it, this rebirth was conceived on a mostly-empty plane to Reno. Now, instead of magazine writing, Dan would plunge into the world of New Media and write for Matt Marshall's blog.

It's funny how it goes.