Online SMB Lender Kabbage Secures $500M for Loans

Congrats to a “neighbor” here in Atlanta that is really kicking b*** in the small business loan market. Kabbage just got another $500M to make some of it’s well scrutinized loans to the business community. More billions to help grow businesses and create jobs. Kabbage also offers a white label lending platform encompassing both their SMB loan business (through Kabbage) and their consumer loan business (through their consumer affiliate  Karrot) and counts Experian, Scotiabank,  MasterCard and Santander as partners, amongst others.  Go Kabbage.
(Bill Taylor/CEO)

“Kabbage, a billion-dollar startup that combines machine learning algorithms, data from public profiles on the internet and other factors to rate and then loan people money for their small businesses, is today announcing another big step up in its ambitions. The company has secured over $500 million in fixed-rate, asset-backed notes, money that it will use to expand the amount, payback terms and size of loans it makes to SMBs over the next three years. To date, Kabbage has loaned over $2.7 billion to SMBs since being founded in 2009.

Kabbage said the securitization was oversubscribed. In fact, last night, when I interviewed Kevin Phillips, head of corporate development and one of the people who built Kabbage’s original platform when it was founded in Atlanta, Georgia, he told me that by the time the securitization closes (around March 20), it’s likely to be a little higher than $500 million, maybe more like $525 million, due to interest from institutional investors and others.

Guggenheim Securities, a previous backer of Kabbage who was behind a $270 million credit line to the company in 2014, is serving as sole structuring advisor and initial purchaser of the notes.

Kabbage’s rising fortunes are coming at critical point for the online small business loan market.

Can Capital — last year halted new loans as it changed management and restructured the company….

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