The deal was part of a $125 million secondary transaction where existing investors sold portions of their shares to new investor Google and previous investor Foundation Capital. No new money is going into the company, rather it is a reshuffling of equity to allow room for Google on the board.

Lending Club is an online community that connects people who need to borrow money with people to lend it to them. Borrowers apply for a personal loan and receive a rate quote. Interested investors fund these loans and automatically receive monthly payments on these loans in their bank account.

“Google was excited about the possibility that Lending Club could transform the banking system,” said CEO Renaud Laplanche in an interview with VentureBeat. “We are using technology and innovation to lower costs, provide more value to our customers, and increase transparency. These are all things Google has done with other sectors, and they are interested in our ability to do that in financial services, which is one of the few last large industries that has not been transformed.”

Lending Club grew by leaps and bounds over the past year and with volume almost tripling. It originated 780 million in loans in 2012 and is on track to do $2 billion this year. As of May 1st, Lending Club had funded $1.67 billion in loans. The company charges an origination fee to borrowers and a servicing free to investors and is on track to generate $90 million in revenue this year. Laplanche said that this impressive traction caught Google’s eye and it approached Lending Club about getting in on the action.

“We talked to our investors and said we wanted Google on the board, but did not want to raise additional capital and wanted them to sell some of their shares,” he said. “There was an increase in share price from last year, which made the transition easier. Our valuation is now at $1.55 billion, up from 550 million, which is a 3 times increase in just twelve months.”

The national average interest rate for unsecured personal loans in the U.S. is just over nine percent, while Lending Club offers between six and seven percent. By circumventing banks, Lending Club is able to offer lower rates. Laplanche had the idea for Lending Club in 2006 after paying 18 percent interest rate on his credit card. He realized that money was helping to fuel an inefficient system and that by allowing people to directly invest in people, it would benefit everybody involved. Now seven years later, the idea has taken off.

With this latest transaction, Laplanche said that things won’t change much initially. Over time, however, there is potential for partnerships. Right now, he is focused on providing the best possible product for consumers. Lending Club primarily deals with unsecured personal loans, but is exploring adding in student loans, auto loans and mortgage loans down the road.

Lending Club has raised $102 million to date and as mentioned above, existing investor Foundation Capital gained a greater stake as part of this deal. This marks the firm’s largest investment ever made over the course of its 18-year existence, with more than $50 million invested.

“We’ve never seen a market opportunity of this size and magnitude,” said general partner Charles Moldow. “In the financial services industry, we are seeing a shift toward the transparency of information and Lending Club is leading the charge. There is a massive restructuring taking place. We believe that Lending Club’s growth has signified that the uses of technology in the financial industry are limitless, extending to a shift in the flow of information, transparency and decision making at all levels. This is disrupting the traditional banking model as we know it.”

Moldow also said that Foundation Capital sees Lending Club as an iconic company akin to Amazon, eBay, Salesforce, or LinkedIn. The financial services industry is massive and ripe for disruption, with large returns to boot. Lending Club has generated 22 consecutive quarters of positive returns for investors and it seems that pattern will only continue. Google will join the board along with such luminaries as Mary Meeker, John Mack, and Larry Summers.

Photo Credit: Rockbadger/Flickr

Financial technology startups are offering a legitimate alternative to the traditional bank.

The latest fin-tech startup to get a stamp of approval (and very large cheque) from the venture capital community is On Deck. The New York-based company nabbed an additional $17 millon in investment for its fourth round from Google Ventures and PayPal cofounder and investor Peter Thiel.

In February, the company closed $42 million in funding led by Institutional Venture Partners. This brings its total fourth round funding to $59 million.

On Deck customer Kristopher Jackson was granted a $25,000 loan.

On Deck says it opened its round to further investment so it can build more products, and hire technical talent. But the company will also benefit from its association with Thiel, a major player in Silicon Valley, and a notoriously founder-friendly investor.

In a nutshell, On Deck offers short-term loans ranging from $5,000 to $150,000 to small businesses that need them. The application process typically only takes a few minutes, and the company is often able to give applicants decisions within a day.

CEO Noah Breslow he aims to make it easier for all Main Street businesses to secure a loan. Breslow’s ambitious goal is to make “on demand capital” a reality for small businesses.

On Deck has a novel approach to determine whether to grant a loan, and the appropriate amount to lend. It has developed proprietary technology to evaluate hundreds of non-traditional data sources to best evaluate the health of a business. These data points include Yelp reviews, and “social media is also part of the equation,” Breslow told me. The company also tracks engagement on a loan applicant’s LinkedIn and Facebook page.

OnDeck isn’t the only startup that is helping cash-strapped businesses. Kabbage provides loans to online merchants, and Kreditech uses thousands of data points to determine how creditworthy you really are.

New occupations have flourished on the web; among them, merchants on online marketplaces like Amazon and eBay.

But these new occupations are not supported by Main Street’s banks, and sellers are often deemed too risky for a loan.

To meet the demand, organizations like Atlanta, Georgia-based Kabbage are providing working capital to small-business owners so they won’t need to put personal assets on the line, like a house or car.

And Kabbage just announced it has closed a credit facility of $75 million, its largest to date. After just two years of operations, Kabbage claims to deliver more advances than any other provider in the industry. For this reason, Kabbage was named the winner at VentureBeat’s recent Innovation Showdown at our CloudBeat conference.

The company says it has extended more than 60,000 advances and expects to provide more than 100,000 by the end of the year.

CEO Rob Frohwein explained in a recent interview that the engineering team is analyzing all the data it can gather to make “educated guesses” about a loan applicant’s future growth. Ideally, it is looking to fund merchants who are making about $1,000 a month through their online store.

“When we tap into the data, we can see how you [an online merchant] were doing six months ago and project how you might fare a year from now,” he explained. Kabbage provides funding to about 80 percent of the small businesses that apply — the big question, Frohwein admits, is how large the loan should be.

Kabbage monitors how merchants are interacting with their customers on social media sites, selling on UPS, or managing their finances in Quickbooks (Intuit’s accounting software for SMBs), as well as their transaction data from sites like eBay, Amazon and Etsy, to determine whether to give out a loan.

“There is a clear void in the market as traditional financing sources remain reluctant to lend,” said Victory Park Capital’s Tom Affolter.

Victory Park Capital led the funding round, and equity investor Thomvest Ventures also contributed.

Prosper.com announced today that it has raised $20 million from the prestigious venture firm Sequoia Capital. It’s slated this funding to “accelerate Prosper’s growth at a time when the market for peer-to-peer and business-to-peer finance is rapidly expanding.” In short, to help Prosper out-prosper its competitor, Lending Club.

Prosper also announced it has appointed Stephan Vermut as the new CEO, the former founder and managing partner of Merlin Securities that was recently acquired by Wells Fargo.

“I’ve watched with great interest over the past few years as the peer-to-peer lending industry has grown substantially, and I believe Prosper is in a unique position to offer both borrowers and lenders unprecedented access to financial opportunity,” said Vermut in a statement.

People traditionally take out loans with banks. Prosper eliminates the middle man by connecting people who want to invest money with people who want to borrow money. Borrowers list loan requests between $2,000 and $25,000, and individual lenders invest as little as $25 in each loan and earn returns on their investment.

Prosper has enabled more than $400 million in personal loans since it pioneered this type of service in 2006. Over the years, it has hit some road bumps with the SEC, shutting down in 2008 after receiving a cease-and-desist letter for not properly registering under the Securities Act. The company has come back, however, and now claims to be growing at 100 percent year-over-year in revenue and loan originations. There have also been some product changes that inspire more confidence, and this money will take the Prosper into “its next phrase of growth.”

This is Prosper’s sixth round of institutional funding and brings its total to $94.7 million. Previous investors include a laundry list of venture firms, including Draper Fisher Jurveston, Crosslink Capital, Accel, and Benchmark.

Read the press release.

Today, TripAdvisor and Kiva are announcing a partnership that will help with the ‘how.’

Kiva is a non-profit organization that facilities microfinance loans to sustainably fight poverty. The platform connects lenders with borrowers who use the money to create opportunities for themselves. Kiva works with individuals and partner organizations around the world to create a database of borrowers who post profiles with their intended project. This could be anything from giving a Kenyan farmer capital to buy livestock to helping a Phillippino store owner stock her store. Lenders offer a loan as small as $25, receive progress updates, and get paid back as soon as the entrepreneur is able.

As part of the partnership, TripAdvisor will make Kiva loans on behalf of its community. When a traveler submits a TripAdvisor review for a Kiva country, they will be offered the opportunity to select who they want to fund, and TripAdvisor will make a $25 loan. The first phase will fund $250K in loans, at no cost to the traveler.

“There is an overlap between the Kiva spirit and the spirit of what our community does,” said TripAdvisor CMO Barbara Messing. “Travelers to developing countries often feel like they want to do more. They enjoy the hotels and the food but realize folks in that country need more than a smile, they need resources. This partnership says to a traveler ‘hey, you just had a great trip, and here is a real and meaningful way for you to give back.’”

One of Kiva’s core goals is to help people achieve financial independence. The site emphasizes the story behind each entrepreneur to create a lasting connection between borrowers and lenders. This aligns with TripAdvisor’s brand as well, which in its own way, provides a channel for travelers to share their experiences.

“When you see someone and hear their story, it creates empathy,” said Kiva President Premal Shah on a Skype call from Sierra Leone. “Empathy creates generosity, and complete strangers are willing to lend each other money. What fosters and sustains that trust is when the money is repaid and can be loaned again and again. This is why the TripAdvisor partnership makes sense — as global citizens, none of us are visitors. We are connected, and this is never more clear than when we travel. Through this partnership, you can continue the affinity for the places you visit after you leave.”

Shah said the world is shrinking, and mobile technology is spreading to even the most remote corners of the globe. These trends, combined with developments in crowdsourcing and payments technology, have a profound impact on access to capital. Put that together with the 60 million monthly visitors to TripAdvisor, and you get thousands upon thousands of people whose lives will never be the same.

When loan sharks bite, they bite hard and often leave a nasty scar. But when you need cash and the bank is shutting you out, there’s often no other option.

Aidil Zulkifli, a lawyer in Singapore, and Izati Ngaliman, who heads up the marketing side, founded Singapore-based LoanGarage in 2012 to solve this problem. The two founders are building the business with the goal of making loan sharks more transparent.

“More consumers are turning to private lenders for personal loans simply because they are underserved by traditional banks and financial institutions for a variety of reasons,” said Ngaliman in an email to VentureBeat. “But the private lending industry is currently a nontransparent market where legal lenders and illegal loan sharks are almost indistinguishable.”

The company lists lenders — banks and private loans alike — on its website where borrowers can peruse their options. The lenders have LoanGarage’s stamp of approval, which means they’ve been vetted and are trustworthy. The borrowers then fill out an application and can quickly apply to a number of loans and “shop around” for the best deal.

LoanGarage is currently only available in Singapore, but if the company receives its first round of funding in time, it will expand internationally in the first quarter of 2013.

But it’s not just the beleaguered folks in countries like the U.S. and the U.K. that LoanGarage wants to help. Indeed, Ngaliman says the company is well equipped to serve emerging markets, as well.

“LoanGarage is here to serve not only those with bank accounts, but also those without,” he said. “For example, 58 percent of Indonesians are still unbanked, but they have access to Internet via mobile. … It is crucial for consumers in the emerging markets to have access to financial products. Eighty-four percent of the world’s population lives in emerging markets. We don’t see why financial products and technology should only be developed or created for the minority 16 percent in the developed markets, where the population is well served, or over-served.”

Catering to this, LoanGarage plans to release a home-grown way of assessing credit scores. It will take into account traditional forms of credit scoring but also include some unconventional ones, which will undoubtedly serve those who do not have a bank account. The hope is that borrowers who are turned down for poor credit will have a different avenue to prove that they are worthy of the loan. This technology should be available by November 2012.

On the DEMO stage, Founders’ Den managing partner Jason Johnson said the service reminded him of AngelList, which connects early-stage startups with part-time investors and went so far as to say he could see the service doing well outside the developing world, too.

Think $30 million is a lot to pay for produce? Not when it gives money back. Kabbage, which gives loans to online sellers, got $30 million in funding today, led by Thomvest Ventures.

Kabbage will give cash advances to small online merchants that need extra capital to pay employees, product products, get office space, and the myriad of other things businesses do to get bigger. In order to get an advance from Kabbage, you must be selling products via eBay, Amazon, Yahoo Stores, Etsy, Shopify, Magento, or using PayPal to process payments. When you apply for an account, the company’s technology will look at your seller history and determine whether you are approved for the capital and how much.

From there, Kabbage will put your cash advance directly into your business’ PayPal account. Seller pay Kabbage back over six months. Each month Kabbage takes a sixth of loan amount adds on an extra fee, which is to be paid by the seller. This fee can range between two and seven percent of the over advance. After the first two months, the fee goes down to a set one percent.

Kabbage received its first round of funding in August 2011, totaling at $17 million. The round was led by Mohr Davidow Ventures. This round was led by Thomvest Ventures with participation from existing investors Mohr Davidow Ventures, BlueRun Ventures, UPS Strategic Enterprise Fund, and individuals Warren Stephens, and David Bonderman.

Thus far the Atlanta company has taken on a total of $56 million in funding.

Even with the recent passage of the JOBS act, there’s still a lot of debate in Washington D.C. on how best to spend taxpayers’ money to create jobs. Committee Chair Sen. Mary Landrieu (D-LA) introduced a bill earlier this year to increase the combined leverage capacity for affiliated Small Business Investment Company (SBIC) program funds from $225 million to $350 million.

However, there is a huge misunderstanding that the proposed increase will merely expand the U.S. deficit, which it will not. The SBIC program is, by and large, self-funded, and the SBIC debenture program is a government guarantee. Only after all of the contributed equity capital is fully absorbed or used up will the debenture holders look to the U.S. government as a source of repayment.

I believe this is another important step for fostering entrepreneurship, stimulating small business growth and creating jobs and I shared my views on Capitol Hill with other business leaders.

I should make a disclaimer that for me, this is personal. I’ve been there. In 2003, I had an idea; I had experience; I wanted to start a company that would help fund entrepreneurs who needed capital to grow their business. However, I could not get a bank — any bank — to give me the capital I needed to get going. Fortunately, the SBIC was there to fund my startup, Hercules Technology Growth Capital, in 2006. Now, as an SBIC licensee ourselves, Hercules has funded other entrepreneurial pioneers who have gone on to create hundreds of other technology jobs.

Through the Small Business Association’s (SBA) SBIC debenture program, billions of dollars in critical loans have already been provided to some of our nation’s most promising companies through accredited and proven lenders such as Hercules. This was especially true during the 2007-2009 credit crises. When many banks stopped lending entirely, the SBIC debenture program became a crucial funding source for many entrepreneurial companies. In fact, our own credit facility was not renewed by our two banks and without our SBIC facility, many more companies besides our own would have suffered.

The real debate is how we can further provide American entrepreneurs, from Main Street to Silicon Valley, with access to the capital they need to start and grow innovative new companies such as new medical technologies or cloud computing companies. There’s an incredible amount of American ingenuity that just needs help with ramping up and getting capital, especially in the West, which is the most under-served by the SBA.

Despite outsized valuations and funding rounds for certain companies, the current venture capital industry is nowhere near its historic peak in terms of funding. In 2000, at its peak, venture capital firms invested approximately $99 billion. Last year, according to the National Venture Capital Association (NVCA), the venture market only did $29 billion in activity. The SBA program complements the venture market by providing access to non-dilutive capital for startups through its licensees.

Unfortunately, the program is not well known by many entrepreneurs. I would encourage the SBA to provide forums to teach entrepreneurs how to use the SBIC to get a company off the ground and accelerate their growth rates, by using SBIC’s as an additional source of funding..

Hercules has witnessed firsthand the enormous impact of strategic capital on the evolution of innovative companies such as Annie’s, Box.net, BrightSource Energy, and Aveo Pharmaceuticals as they grew from start-ups to market leaders. Frankly, I would love to go beyond the $350 million Senator Landrieu has suggested because I know we could put that money to work, and use it to create many more technology-related jobs in this country.

By providing as many funding options as possible to entrepreneurs, the new proposed legislation can help to spur technological innovation and maintain U.S. competitive advantage in critical industries such as technology, life science and cleantech. I hope to see this debate continue.

Manuel A. Henriquez is the Chairman, Co-founder and CEO of Hercules Technology Growth Capital (NYSE: HTGC), an SBIC licensee and specialty finance firm that provides customized debt financing to venture-backed companies. He recently participated in a Senatorial Roundtable Committee on Small Business and Entrepreneurship SBA roundtable.

Photo credit: stevendepolo via photo pin

Apple isn’t hogging the entire news spotlight today. A few other companies snagged some cash to build their businesses. Check out who got funded today, proving you can still get noticed on the day Apple releases a ton of news.

This is just an end-of-day roundup of the funding news. For more up-to-date deal flow, you can visit our Deals channel, where we post the latest funding news as quickly as we get it, or by adding the Deals Channel feed link to your favorite reader. And as always, send funding news our way at tips@venturebeat.com.

Credit Sesame gets $12M in the bank

Credit Sesame, a credit and loan monitoring startup, has closed a new $12 million third-round of funding, the company announced today. The company’s service is meant to help people keep track of various kinds of debts, loans, and credit funds, such as mortgages, credit cards, consumer loans, and student loans. The new round was led by Globespan Capital Partners, with participation from Menlo Ventures and Inventus Capital. Read more on VentureBeat: Loan monitoring startup Credit Sesame banks another $12M.

Gigya gets $15.3 million to make brands more social

Gigya, a six-year-old startup powering the social functionality behind brand name applications and reaching more than a billion people each month, has raised $15.3 million in its fifth round of funding. Condé Nast owner Advance Publications and Adobe joined existing investors Mayfield Fund, Benchmark Capital, and DAG Ventures in piling in on the new round. Gigya has raised a total of roughly $45 million in funding to date. Read more on VentureBeat: Gigya, the startup that adds social to brand name apps, gets $15.3M.

DramaFever raises $6M

Video platform DramaFever has raised $6 million in new funding. The company offers Korean TV shows that can be watched with Android and iOS apps, and on Roku boxes and the Google TV. AMC Networks, Bertelsmann Digital Media Investments, and NALA Investments contributed to this round. Read the press release: DramaFever completes $6 million round with backing from global media giants.

iGet.it confirms $1.3M by Real Ventures

Canadian social e-commerce site iGet.it raised $1.3 million in funding. Like Fab and Gilt Groupe, the site offers flash sales of hand-picked luxury goods. Real Ventures led the round, with participation from White Star Capital. Read the press release: iGet.it confirms second financing round led by Real Ventures.

Woman holding credit cards image via Flickr user michael_swan

The brains behind Lenddo, co-founders Jeff Stewart and Richard Eldridge and chief scientist Dr. Naveen Agnihotri, think a person’s social graph can be a better indicator of trustworthiness than a credit score. Anyone who’s ever tried to get a loan or credit card without prior credit knows it’s a circular problem, one that is infinitely more difficult in emerging economies. Lenddo helps individuals in these countries break out of the cycle with small loans up to one month’s pay.

The company takes the wealth of data from your many social networks (including Facebook, LinkedIn, Twitter), looks at the people in your Lenddo Trusted Network (family, friends, co-workers), verifies you have a full-time job, and uses predictive algorithms to confirm your identity and calculate if you are a risk. There are three types of algorithms it uses: Bayesian (pattern matching), validators (verifying your identity and the information you’ve given), homophily (you’re likely to associate with people similar to you).

“It turns out, who is willing to endorse you is a powerful indicator of your trustworthiness,” a Lendoo spokesperson told us in an email. “As more people pay back, the network grows, and the borrowing capacity of the community grows.”

Currently, Lenddo only offers loans in the Philippines and Colombia, though it has tens of thousands of members in over 35 countries. The company won’t say how many loans or how much cash it has given out to date, but the average loan is $400 the Philippines and near $800 in Columbia, and the total amount is growing at close to one percent a day. The loans are most frequently used for education, but can also be put towards health care or repairs after a natural disaster, such as the recent devastating floods in the Philippines.

The company plans to use this $8 million round of funding to hire more engineers, ramp up growth, and eventually expand into other emerging markets, a process it says will be driven by its members.

Started in early 2011, Lenddo has employees in Manila, Bogotá, and New York City. Accel Partners, Blumberg Capital, Omidyar Network, iNovia Capital and Metamorphic Ventures participated in this round of funding, as did angel investors Geoff Judge, David Kidder, Scott Heiferman, and Barry Silbert.

“ZestCash doesn’t pull any information from credit bureaus. Instead we use uses non obvious variables, like cell phone payment records and how much time applicants spend on our site, to offer loans to our customers,” CEO Douglas Merrill told VentureBeat in an interview.

Most banks approve borrowers for loans based on small amounts of data; usually a credit report and credit score from FICO, a company that evaluates credit risks. Since not every person has enough information on file with FICO, some people are turned away for loans from major lending institutions. ZestCash uses thousands of metrics to offer short-term installment loans to customers who can’t get loans elsewhere.

Each loan is designed by the customer, based on how much money they need — up to $800– and how much time they need to pay it back. ZestCash emphasizes smaller payments over a longer time to pay back its loans to help their customers from getting too deep in debt.

“We will use the $23 million capital from Matrix Partners to add more staff, increase our marketing efforts, and push forward with bringing loans to additional states. We will use the $50 million debt line Victory Park Capital to make loans to customers,” said Merrill.

This fundraising round included $23 million from Matrix Partners and $50 million in debt financing from Victory Park Capital. Lightspeed Venture Partners, GRP Partners, Flybridge Capital and Lighthouse Capital Partners participated as well. ZestCash was founded in 2009 by Douglas Merrill, former Google Chief Information Officer, and Shawn Budde, former Head of Subprime Credit Cards at Capital One and has more than 75 employees. Currently, ZestCash is able to offer loans to customers in Utah, Idaho, South Dakota and Missouri, with more states coming soon.

In a sluggish economy, San Francisco-based Taulia is offering suppliers an alternative to the traditional – and expensive – modes of external financing. This means suppliers of all sizes can avoid resorting to lenders and keep paying their employees.

And even though borrowing money is often the financing of choice, the fear of more blows to the economy – be it a double-dip recession or the fight over raising the debt ceiling – leads lenders to balk at small business loans. Taulia aims to save businesses from falling prey to external financing, and helps them when external financing isn’t an option.

“If you look between 100 years back and today, payment terms have stayed the same or even stretched out,” said chief executive Bertram Meyer, pictured right.

That is to say the life of an invoice may be up to 60 days long, with the buyer often not paying suppliers until day 60. Having a payment delayed for two months after a product has shipped can force a company to take out loans just to cover payroll expenses.

“A supplier has three ways to get financing. The first is bank loans, the second is credit-card borrowing (similar to the first) and the third is factoring. Taulia is replacing all three.”

Taulia works as a facilitator, managing “win-win” discounts between a buyer and seller. Discounts are used to encourage buyers to pay invoices quickly, instead of waiting until the end of a payment term. As Taulia’s moto says, “Pay early, pay less.” Suppliers are willing to take the price cut because a regular payment cycle means cash in the bank to cover overhead.

The funding will be used to expand Taulia’s resources to accommodate for what Betram says are unexpected parallel projects. The company originally budgeted for one client project at a time, but is seeing five to six. Currently, Taulia signs one Fortune 500 company a month, with a few Fortune 50 companies interspersed. Big-wig clients include Phizer and Coca-Cola.

In addition to U.S. growth, Taulia wants to expand into the European Union and is hiring for its Germany office. Betram also expressed Taulia’s need for engineers. The company has 8 positions open, but is seeing a lot of competition for engineers.

Taulia was incorporated in 2009 and is approaching 40 employees. The company has a total of $11.7 million in financing from the same venture capitalist firms. Taulia received its first round of funding in December 2010.

Pawngo, which was previously named Internet Pawn, aims to fulfill a need in the market for short-term loans between $1,500 and $15,000.

With so many people facing financial hard times at the moment, an online pawn shop does make a lot of sense — especially since low credit scores wouldn’t prevent someone from a loan the same way it would if attempting to get money from a bank.

The service works by having customers supply information about items they wish to pawn. Within an hour, the company’s Denver-based valuation lab returns an estimate just like a traditional pawn shop. If the amount is satisfactory, the customer ships the item to Pawngo’s vault for a period of  three to six months (depending on the loan agreement).

Pawngo makes money through a “monthly option charge”’ equal to three to six percent of the loan, which it debits directly out of a customer’s bank account. If a customer chooses not to pay back the loan within the allotted time, the company resells the item to recuperate any loss.

Some have noted that the shady nature of Pawngo’s previous incarnation, which required customers to send in their items without getting an estimate on how much the loan amount would be, may still linger on the latest version of the site. But however questionable the service may be, it’s still a way for people to get money quickly and likely won’t be what holds the company back from being successful.

One factor that could hold Pawngo back is scalability of the storage “vault” where all pawned items are kept and the workforce assessing estimated resale value of items, which may be an issue as the service grows in popularity.

Scalability is something that group-offer site Groupon has done very well but, that doesn’t necessarily translate into profitability. Founders Lefkofsky and  Keywell, washed their hands of the startup after realizing Groupon’s large-scale operating costs were not sustainable. If Pawngo can manage its growth, it may have a chance at becoming the next big online financial platform.

The new round of funding, Pawngo’s second, brings the company’s total funding to $4.5 million since launching in August 2009. The company claims to have loaned out a total of $1,377,360, according to the ticker on its website.