LendingClub’s high-profile board of directors just got even more star power.
The provider of online consumer loans announced today that former U.S. Treasury Secretary Lawrence Summers joined the board, which includes ex-Morgan Stanley Chief Executive Officer John Mack and Internet analyst-turned-venture capitalist Mary Meeker.
Summers, 58, worked for the Treasury Department from 1993 to 2001, including a two-year stint as secretary. He also spent five years as president of Harvard University, where he currently teaches economics. He led the National Economic Council under President Barack Obama through 2010, and was previously chief economist at the World Bank.
“When you’re running a consumer lending business, economics are important,” LendingClub Chief Executive Officer Renaud Laplanche said in an interview. “Having someone on the board who’s a reputable economist and one of the best of a generation is a very strong benefit and strong competitive advantage.”
In the first quarter of 2013, the San Francisco-based company will name its eighth board member — its last vacancy — to also serve as the chairperson of its audit committee, Laplanche said.
LendingClub issues loans of up to $35,000 to help consumers pay off student loans, remodel their homes and take vacations, offering interest rates that are typically lower than credit cards. The loans are sold in pieces to retail and institutional investors on LendingClub’s website. The notes have provided a net annualized return of between 5.7 percent and 12 percent a year to holders, according to the company.
The company has issued more than $1 billion in loans since opening in 2007 and is likely to double revenue next year to $80 million, Laplanche said. In the peer-to-peer online loan market, LendingClub competes with Prosper Marketplace, which is also based in San Francisco.
“At a time when our financial system has become more concentrated, I think there are important opportunities for disruptive innovation that is oriented to making the economy work better for regular families,” Summers said in an interview. “I’ve been concerned about questions of credit access for a long time.”
The intersection of finance and technology has become an attractive spot for Summers. In June 2011, he joined the board of Square, the mobile payments startup created by Twitter co-founder Jack Dorsey. That month he also joined Silicon Valley venture capital firm Andreessen Horowitz as a special adviser to help entrepreneurs looking to build their international operations.
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