LendStreet, the financial technology and services company founded by Jerry Nemorin, announced it has raised an additional $117 million in its new venture capital round.
The online fintech company, which restructures debt for consumers in financial distress, closed a $7 million Series A equity round led by Prudential Financial Inc., and Radicle Impact. It also raised an additional $110 million in debt financing from Prudential and Community Investment Management (CIM)—adding to LendStreet roster of existing investors such as Accion, the Center for Financial Services Innovation (CFSI), Serious Change, Crunchfund, Kapor Capital, and Cross Culture Ventures.
“Lower and middle-income Americans are struggling and relying on high-interest credit cards for their day-to-day survival. These investments will enable us to scale our platform and reach more consumers who are struggling with too much debt,” said Jerry Nemorin, founder and CEO of LendStreet. “Prudential, CIM, Radicle Impact, and our other investors share our vision of finally giving mainstream Americans access to an equitable and transparent alternative for their mounting credit card debt.”
After enrolling customers into LendStreet program, the service lends those customers money to pay off creditors at discounted, negotiated rates. The loan requires customers to make six months of consecutive payments per the enrollment agreement. Fees and interest rates vary state by state. Interest rates range from 14.95% to 17.95%, and origination fees can be about $40, depending on the state. Since its inception, LendStreet said it has successfully helped customers reduce their debt by nearly 40% and also improved credit scores by an average of 100 points, by providing technology-based solutions and resources.
Along with the new round of investment, LendStreet adds two seasoned financial services veterans to its board in Miljana Vujosevic, who has a decade of experience supporting economic opportunity for individuals and communities. Catha Groot, a principal at Radicle brings more than 10 years of investment experience to LendStreet. They will join existing board members Nemorin, Michael Snyder, and KG Charles-Harris.
“The LendStreet platform provides a solutions-based user experience for consumers under financial stress,” said Tom Coombs, co-founder and vice president of product development at LendStreet. “Understanding your options to pay down debt and rebuild your credit is not easy. LendStreet is giving over-banked consumers a more manageable, transparent, and sustained path to restructuring debt and improving their financial health.”