Upstart (company)
 | |
| Type | Private |
|---|---|
| Founded | April, 2012 |
| Headquarters | Palo Alto, California, United States |
| Founder(s) |
Dave Girouard Anna Mongayt Paul Gu |
| Employees | 24 |
| Website |
www |
| Type of site | Crowd funding |
| Available in | English |
| Launched | April 2012 |
| Current status | Active |
Upstart is a peer-to-peer lending platform. The founding team includes Dave Girouard, a former VP of Apps for Google, Paul Gu, a Thiel Fellow, and Anna Mongayt, who worked for 5 years at Google where she ran global Enterprise Customer Programs and Gmail Consumer Operations.[1]
Upstart first launched with an Income Share Agreement (ISA), which enabled individuals to raise money by agreeing to share a percent of their future income. Individual profiles were listed on the site for 60 days, during which investors would make offers to upstart to give them money in exchange for a percent of their future income for 5 or 10 years. In May 2014, the company stopped offering this funding option [2]
In April 2014, Upstart began offering a traditional 3-year loan. In addition to using traditional underwriting criteria—FICO score, credit report and income—Upstart uses its income prediction model, which considers academic variables— colleges attended, area of study, GPA, and standardized test scores—and work history to develop a statistical model of the borrower’s financial capacity and personal propensity to repay.[3]
Upstart raised a $1.75M seed round from First Round Capital, Kleiner Perkins Caufield & Byers, NEA, Google Ventures, Crunchfund and Mark Cuban. They subsequently raised a series A round of $5.9M which included new investors Eric Schmidt, Marc Benioff, Khosla Ventures, Founders Fund, and Collaborative Fund[1] Jessica Jackley and Bob Kerrey serve as advisors to the company.
Upstart is a for-profit company which makes its money by charging borrowers an origination fee between 1% and 6% of the amount they borrow. It was launched in April 2012 and its beta site went live in August 2012.[4]
Upstart has thousands of borrowers and a blend of both retail and institutional investors. The company issues personal loans ranging from $3,000- $35,000.
Coverage
Upstart has been covered by Forbes,[5] Wired, Mother Nature Network,[4] and VentureBeat.[6]
Economist Bryan Caplan blogged about Upstart on EconLog, his blog.[7]
The American Enterprise Institute published a policy analysis of Income Share Agreements (ISAs) as an emerging alternative to student loans in the United States and some Latin American countries. The paper discusses Upstart, Lumni, and Pave as the three established ISA providers in the United States.[8]
References
- 1 2 "About Upstart". Upstart. Retrieved 20 December 2012.
- ↑ Girouard, Dave (2014-05-07). "Sunsetting Income Share Agreements on Upstart". Upstart.
- ↑ Keohane, Dennis (2014-04-29). "Upstart keeps innovating lending models to finance the young and ambitious". BetaBoston.
- 1 2 Agence France-Presse, “New U.S. website lets 'crowd' fund college grad startups”, Mother Nature Network, 8 August 2012.
- ↑ Griswold, Alison (2012-08-10). "Upstart: Can Crowdfunding Your Education And Career Really Work?". Forbes.
- ↑ Farr, Christina (2012-08-08). "A brainchild of ex-Googlers, Upstart lets you invest in people". VentureBeat. Retrieved 2013-09-15.
- ↑ Caplan, Bryan (2013-08-07). "Upstart Bleg: Help Paul Gu Help You". Retrieved 2013-09-15.
- ↑ Miguel Palacios, Tonio DeSorrento, & Andrew P. Kelly. "Investing in Value, Sharing Risk: Financing Higher Education through Income Share Agreements" (PDF).