LendingClub, the peer-to-peer Internet lender, has landed another Morgan Stanley heavyweight as part of its push to go from niche to mainstream.
The company said today that Mary Meeker, the former Morgan Stanley technology analyst turned venture capitalist, is joining the board as part of a $15 million investment from Kleiner Perkins Caufield & Byers, where she’s a partner. She follows ex-Morgan Stanley Chief Executive Officer John Mack, who joined the board in April and is also investing $2.5 million in the San Francisco-based company.
There’s no hiding the reason for adding another banking veteran.
LendingClub, which issues consumer loans of up to $35,000 for everything from home repair to exotic vacations, funds those loans by luring investors to buy pieces of them at attractive rates. Morgan Stanley, through its partial ownership of Smith Barney, has brokers across the country who can potentially add LendingClub loans to the portfolio of investment choices offered to consumers. The larger the investor pool, the more loans it can issue.
“Morgan Stanley is one of several potential partners in the next few years,” said LendingClub CEO Renaud Laplanche, who was introduced to Mack by Meeker.
LendingClub issued $45 million of loans in May and expects that to increase to $50 million this month. The money from Kleiner Perkins and Mack bring the total amount raised by the company to $100 million. That’s all for expansion and building the balance sheet, not funding loans.
Laplanche said he’s looking to add another board member or two with the financial chops of Mack and Meeker in the next six to nine months. His view is that while Silicon Valley knows about LendingClub and online consumer loans, the broader financial world is still stuck in brick and mortar.
“We’re trying to change how people enter into financial transactions,” he said. “We’re trying to disintermediate the banks entirely.”