(Xconomy, January 21st, 2016)
LoanHero, which operates an online loan origination platform, said it has extended its seed funding, adding $2.5 million to the initial $1.7 million the San Diego-based startup raised last June.
Alsop Louie Partners, the early stage San Francisco venture firm, and Los Angeles-based Mucker Capital led the investment, according to a statement from the company. The company pegged its lending capacity at $20 million.
The additional funding is expected to enable LoanHero to grow its loan portfolio by more than tenfold over 2016. The company says it plans to expand nationwide and provide retail loans in sectors like furniture, auto repair, home improvement, and alternative health.
LoanHero’s business is focused on what it calls point-of-sale financing—offering consumers a variety of financing options at a checkout register when they are purchasing big-ticket items like funerals, appliances, and medical services. Using software-as-a-service technology, LoanHero says it can offer certain consumers interest rates below that of credit cards, and charge merchants lower transaction fees than credit card networks.
In the last six months, LoanHero says it has made thousands of loans to prime, mid-prime, and sub-prime consumers through 100 merchant partner retail sites in five states.
Entrepreneurs Derek Barclay and Kristin Slink founded LoanHero in 2014, and continue to serve as president and COO, respectively. An early angel investor, Zalman Vitenson, CEO of San Diego-based Integrate Financial, serves as executive chairman, and Stephen Connolly, a former CoreLogic (NYSE: CLGX) general manager, is CEO.
Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at email@example.com or call (619) 669-8788