Last month, Kabbage closed a $270 million credit facility to provide small businesses with loans and to extend credit lines. Now Kabbage has raised $50 million in Series D funding for itself. Kabbage CEO and co-founder Rob Frohwein said that the money will be used for building out its own business, including new marketing efforts and partnerships. Kabbage will also use the funding for ramping up international efforts, especially in the U.K., Canada, and Asia.
Another reason why Kabbage raised this round of funding is to build out its big data platform, which is used for assessing an applicant?s financial and online sales history to determine a credit rating, how much to loan, and how it will be repaid.
This round of funding was led by new investor SoftBank Capital with participation from TCW/Craton, Lumia Capital, David Bonderman, Warren Stephens, UPS? Strategic Enterprise Fund, Peter Thomson?s Thomvest, BlueRun Ventures, and MDV. Kabbage has raised a total of $106 million.
Yesterday, one of Kabbage’s largest competitors Prosper raised $70 million in funding at a $600 million valuation. Another competitor, Lending Club, has a valuation in the billions.
Kabbage has provided around $250 million in loans to businesses that are mostly in the U.S. Kabbage is forecasting its business will grow three-fold again this year alone.
?Kabbage is using data and technology in a highly innovative way to transform the entire small business financing sector,? stated SoftBank partner Steve Murray. ?It is the kind of game-changing opportunity in which SoftBank likes to invest. Kabbage?s powerful underwriting platform which has been so successful here in the US has massive global potential.?
Kabbage is able to assess a loan prospect in minutes, which is much faster than it takes for a traditional bank to process a loan application. Kabbage plans to launch in Canada in the next few months and will tap into the Asian market very soon.