LendingClub founder talks about avoiding past mistakes at Upgrade

Business


More than two years after his ouster from LendingClub, Renaud Laplanche still owns millions of dollars worth of stock in the company he created, even though he’s since started a rival online lender that’s rapidly growing.

“I still very much believe in the company and the people who work there,” Laplanche told CNBC.

For his second act in financial services, Laplanche is focused avoiding past mistakes. He was forced to resign suddenly from LendingClub in May 2016 for a convoluted set of events involving the questionable sale of certain loans by the company and a lack of transparency with the board.

LendingClub has struggled to recover. Since debuting on the New York Stock Exchange at $15 in late 2014, the shares have lost more than three-quarters of their value to $3.38 at Friday’s close.

Laplanche started his new company, Upgrade, in August 2016, three months after leaving LendingClub. His start-up passed $100 million in monthly loan originations in April. By way of comparison, LendingClub, founded in 2016, averaged almost $1 billion in monthly originations in the second quarter.

Laplanche sees plenty of room for both companies to succeed given that low unemployment and loosening regulations have spurred growth in consumer lending. At the end of the second quarter, there were $120 billion worth of outstanding personal loans in the U.S., according to TransUnion,

Here are some key things Laplanche said he’s doing differently with Upgrade:



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