“Led by Foundation Capital, this Series B round funds our ambitious expansion”, says CEO.
Düsseldorf – May 13, 2014 — auxmoney, Germany’s leading online marketplace for peer-to-peer loans, where private consumers can borrow up to €25,000 directly from private and institutional investors, today announced an investment round of $16 million. Led by Foundation Capital, joined by Partech Ventures and Scott Bommer, alongside existing backers Index Ventures and Union Square Ventures. The proceeds will be used for auxmoney’s ambitious expansion plans, by further enhancing the Düsseldorf-based lending and investment platform and expanding the company’s 60-strong team.
auxmoney CEO and co-founder Raffael Johnen said the investment marked a tipping-point for peer-to-peer lending in Germany, with the market set to go mainstream. “We are about to witness a major shift in consumer behaviour towards peer-to-peer loans. As clear market leader in Germany, auxmoney is right at the forefront of this development,” he said. “With our new partners on board, we are ready to turn crowdlending into an integral and mainstream element of Germany’s consumer finance landscape.”
Founded by Raffael Johnen, Philipp Kriependorf and Philip Kamp in 2007, auxmoney is a platform which enables private borrowers to secure personal loans funded by private and institutional investors. By creating a transparent marketplace, where investors and borrowers can interact directly with each other, auxmoney eliminates the high cost and complexity of traditional bank lending. It can offer more attractive rates to borrowers by using its sophisticated proprietary scoring system, which combines in-depth consumer scoring knowledge with the latest online social and behavioural data.
The company has so far facilitated almost 20,000 loans worth $140 million to private borrowers, over 50% of which were issued in the last 12 months. auxmoney’s growth is fuelled by investors seeking attractive risk-adjusted and predictable returns on their capital, as well as borrowers looking for better rates or alternatives to traditional bank loans.
“auxmoney is perfectly positioned to capture a significant share of the German banking and investment market over the next few years,” said Charles Moldow, General Partner at Foundation Capital. “The auxmoney model works and the team proved, in a challenging environment, the capability to deliver tremendous value to both borrowers and investors.”
“We have followed the dynamic development of auxmoney closely for a while and believe auxmoney is one of the very few companies ready to transform the structure of the European consumer lending market,” said Gabriel Matuschka, Principal at Partech Ventures.
John Buttrick, Partner at Union Square Ventures, commented: “We are excited to participate in auxmoney’s Series B round and help accelerate the company´s growth. As an investor in world leader Lending Club and similar companies, we have extensive marketplace experience and believe auxmoney is well placed to be the preeminent online marketplace for lending in Germany and beyond.”
Raffael Johnen, co-founder and CEO of auxmoney added:
“We are very excited to welcome Foundation Capital, Partech Ventures and Scott Bommer, three highly experienced partners, on board. This financing represents a natural next step in auxmoney’s accelerating growth. Our strong financial backing puts us in an ideal position to further capitalise on the enormous demand for crowdlending in Germany. Being clear market leader in Germany, with a proven track record of compelling loan performance on our platform, puts us in a unique position to service a large and partly under-serviced segment of our population. We further welcome the fact that several banks have approached us to co-operate with us. Combining their low cost of capital and reach to customers with our low process cost and underwriting expertise will be an integral part of our growth trajectory.”
auxmoney is an online marketplace that connects credit-worthy borrowers and savvy investors so that both can benefit financially. auxmoney eliminates the high cost and complexity of traditional bank lending by offering a transparent marketplace where its users can directly invest in and borrow from each other. With almost 20,000 financed loans, www.auxmoney.com is Germany’s leading online platform for loans from private investors to private borrowers. To date, more than 40,000 investors have invested about $140 million in private loans on auxmoney’s platform to achieve above-average returns compared to other interest-bearing products.
About Foundation Capital
Foundation Capital is dedicated to the proposition that one entrepreneur’s idea, with the right support, can become a business that changes the world. Foundation Capital has helped companies like Atheros create the mobile Internet, EnerNOC invent the energy demand response market, and Netflix revolutionize media distribution and consumption, among many others. Foundation Capital is currently invested in more than 80 high-growth ventures in the areas of consumer, information technology, software, semiconductors, and clean technology including BoardVantage, Chegg, Coverity, MobileIron, Simply Hired, Sunrun, TubeMogul and Venafi. Foundation Capital’s nineteen IPOs include Control4, Envestnet, Financial Engines, Netflix, NetZero, Responsys and Silver Spring Networks.
Foundation Capital, based in Silicon Valley, is a leading investor in financial technology companies with a specific focus on the global P2P arena. Earlier investments in P2P include Lending Club (the world’s largest marketplace lender), as well as OnDeck and LendingHome. The firm recently released its manifesto “A trillion dollar market by the people for the people” which details the large opportunity in front of p2p marketplaces and the lenders participating
About Index Ventures
Index Ventures is a leading venture capital firm investing in technology and life science companies. From offices in Geneva, London and San Francisco, Index is dedicated to discovering and supporting the best entrepreneurial teams wherever they are looking to build market-defining, global businesses. Since its inception in 1996, Index Ventures has backed visionary entrepreneurs who have taken on incumbents and built seminal companies including MySQL, Virata, Skype, Last.fm and Betfair. Its portfolio currently consists of more than 120 innovative companies based in 20 countries and 39 cities including Aegerion, asos, Climate Corp, Criteo, Dropbox, Etsy, Genmab, Just Eat, King, Hortonworks, MySQL, NumberFour, Pure Storage, Skype, SoundCloud, Sonos and Supercell — among many others.
About Union Square Ventures
Union Square Ventures (USV) is one of the world’s leading venture capital firms investing in internet and mobile internet businesses. Headquartered in New York City, USV backs passionate, experienced entrepreneurs focused on creating highly scalable services and significant value propositions for their end users. USV has been directly involved in the development of more than 40 companies, including Twitter, Lending Club, Tumblr, Foursquare, Kickstarter, Hailo and Zynga.
About Partech Ventures
Partech Ventures is an investor specialized in high-growth-potential internet and information technology companies. The Partech Ventures team benefits from a long-standing track record in the American and European Venture Capital markets. The team has a strong experience in the international development of companies. This investment strategy has been successfully applied for over 30 years and a large number of portfolio companies have successfully executed their IPO or have been acquired by strategic players, including: Brands4Friends (EBAY), Business Objects (BOBJ), DailyMotion (ORANGE), Five9 (FIVN), Invensense (INVN), Qype (YELP). For more information, please visit www.partechventures.com.
About Scott Bommer
Scott Bommer is the Founder and CEO of SAB Capital Management, L.P. („SAB“), a New York-based investment firm managing $1.3 billion of assets in several long-term, value-oriented investment funds primarily focused on public market securities. Founded in 1998, SAB employs a special situations investment approach, pursuing investments which are structurally complex, undergoing transformational company or industry change. SAB invests across a variety of industry sectors including Financials, Industrials, Retail and Consumer, and Technology, Media and Telecommunications. Both SAB and Mr. Bommer have significant P2P investment experience including existing investments in Lending Club, Lending Home and OnDeck Financial.