Wednesday, March 18, 2009

Pertuity Direct Reaches $500K In Two Months

Just two months after launch, Pertuity Direct's mutual-fund P2P lending platform now has $500,000 to lend from members. Pertuity's statistics show that 70% of members on it's web site are taking the next step and opening an account. That is an excellent adoption rate for an online technology.

Pertuity Direct continues to focus on prime borrowers with an average FICO score of 740. The average loan is $9,800. CEO Kim Muhota credits PD's success with the tightening of the consumer credit markets, particularly in credit cards according to a company press release issued today.

I asked Pertuity Direct what the average investor puts into the fund but they're not releasing that info right now, but will be in the near future, so they'll let me know later on.


Our previous coverage of Pertuity Direct:
March 2009: CEO Kim Muhota posts a video explaining the PD lending model
February 2009: Jessica's interview with CEO Kim Muhota - Social lending meets mutual funds
January 23, 2009: Pertuity Direct removes beta label; launches officially
January 2009: Jessica's Pertuity Direct Review
December 2008: Pertuity Direct to launch 'immediately after the New Year'

Jessica Ward is a mommy, freelance writer and blogger. She also blogs on raising a frugal family at http://www.pennywisefamily.blogspot.com/ and on frugal cooking at http://www.3rdworldfood.blogspot.com/.

8 comments:

Tom said...

The challenge with new P2P lending sites seems to be a lack of funds to lend, not a lack of borrowers. So this is good news for PD.

JessicaW said...

True. I recently saw something about the fact that Lending Club funds like 24% of its own loans. The person who posted (I wish I could recall where I saw that) seemed to think that was a bad sign. conversely, I think they know it's a good investment. I wonder if PD will begin doing the same? (perhaps they already are?)

Tom said...

I think you are talking about this story.

JessicaW said...

Yes, I think that's the one. I was surprised by the author's perspective. I would expect a P2P platform to chip in occasionally when enough funders haven't stepped forward. Also, I like to see the company in the position as lender sometimes too because I know that they'll chase defaults aggressively. It sounds like more news is coming from PD soon, so I'll be watching to see if they have anything similar going on.

Tom said...

I also had a different opinion. Here is the comment I left on that post.

"I think it’s actually a good thing that LC funds some of their own loans. They have a classic chicken and egg problem - how do they get borrowers without lenders and how do they get lenders without borrowers. This helps them get to the point where the p2p market can operate by itself.

In addition, with their own skin in the game to the tune of millions of dollars they are much more likely to take collections seriously. Their interests are closely aligned to the success of the borrower."

I'd like to see a PD statistic's site. Prosper and Lending Club both have pages to make things as transparent as possible. I think that is good for p2p lending sites.

Tom said...

I have to say, it is interesting to know that PD has 500K available to lend, but it will be more telling to see how much they are actually lending.

小橋川 純苔 said...

Lending Club charges little fees everywhere (loan payment, loan disbursement, loan trading), but they're fairly clear and transparent.

PD, on the other hand, seems to have some crazy complicated system buried deep in their TOS. At PD there does seem to be a general lack of transparency of the kind that LC has, but I guess it's aimed at different markets. From an investment perspective, PD is for people that just want to put their money in a fund and forget about for a long time, whereas LC is more for people that want to be actively involved in lending.

Anonymous said...

Does anyone understand the fee schedule? Their fee page estimates fees at 1.7% per year assuming a $15M fund from which to lend. If they only have half a mil after 2 months, fees are going to be outrageous.

Their 3yr estimate is really odd, in that it's essentially 5 times the annual fee. What's that about?

It's an interesting idea, but I think they're offering it 2-3 years late. I guess the question is, can they survive for the next 2-3 years until things stabilize?