Capital Opportunities for Small Businesses - sbtdc
Capital Opportunities for Small Businesses - sbtdc
Capital Opportunities for Small Businesses - sbtdc
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C A P I T A L O P P O R T U N I T I E S F O R SMA L L B U S I N E S S E S<br />
connect businesses with brokers and not lenders. For start-up businesses, franchises are the most likely<br />
to find some success via loan matching sites.<br />
Peer-to-Peer Lending (P2P)<br />
Peer-to-peer lending, in which groups of individuals make loans to entrepreneurs through<br />
matchmaking web sites such as Lending Club and Prosper, has gained significant popularity in the last<br />
few years. Most peer-to-peer loans are unsecured personal loans, largely based on personal credit<br />
scores, with a maximum loan amount of $35,000.<br />
The lending intermediaries are <strong>for</strong>-profit businesses; they generate revenue by collecting a onetime<br />
fee on funded loans from borrowers and by assessing a loan servicing fee to investors<br />
(either a fixed amount annually or a percentage of the loan amount).<br />
Does it cost more to borrow from nontraditional lenders Often, yes. At Lending Club, <strong>for</strong> instance,<br />
interest rates range from 6 – 26%, based on an assessment of risk and volatility . Peer-to-peer lending<br />
may be useful when small amounts of funds are needed, and banks are not interested in investing at<br />
that level.<br />
Peer-to-Peer Lending Sites<br />
ACCION USA<br />
115 East 23rd Street, 7th Floor<br />
New York, NY 10010<br />
212.387.0377<br />
info@accionusa.org<br />
www.accionusa.org/default.aspx<br />
Lending Club<br />
71 Stevenson, Suite 300<br />
San Fransisco, CA 94105<br />
866.754.4094<br />
www.lendingclub.com/home.action<br />
GlobeFunder Ventures, Inc.<br />
271-A West Centre #211<br />
Portage, MI 49024<br />
888.870.1304<br />
www.globefunder.com<br />
Prosper Marketplace, Inc.<br />
111 Sutter Street, 22nd Floor<br />
San Francisco, CA 94104<br />
866.615.6319<br />
www.prosper.com<br />
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