LendingClub launched as an app on Facebook and ended up owning a bank. In between, it let ordinary people lend to each other. Borrowers applied online for personal loans, often to pay off credit cards, and investors funded those loans in small pieces. LendingClub earned fees in the middle. When it filed to go public in 2014, it was the largest such marketplace in the United States and a symbol of fintech's promise to bypass banks.

Cutting Out the Middle

Renaud Laplanche founded LendingClub in 2006. It first launched as an app on Facebook. Laplanche believed banks charged too much on credit cards and paid savers too little. His bet was that an online marketplace could cut out the middle and give both sides a better deal. It grew quickly. Over time large institutions became the main investors on the platform.

A Scandal, Then a Bank

LendingClub priced at $15 a share in December 2014 and jumped on its first day. In 2016 a scandal over loan sales forced Laplanche to resign, and the stock fell hard. Scott Sanborn took over as chief executive. In 2021 the company bought Radius Bank and became a bank itself, so it could hold loans and take deposits. LendingClub remains a public company.

Cover: The actor Arashi Ryuzo II as Ishibe no Kinkichi, the moneylender, Tōshūsai Sharaku. Art Institute of Chicago, public domain. Chosen for a kabuki moneylender.