Lendbuzz: How This Company Helps Consumers With Limited Credit History Buy Cars

By Dan Anderson ● July 18, 2019
  • Lendbuzz — a fintech company that is disrupting the car financing market — announced recently that it secured $150 million in debt and equity financing

Lendbuzz — a fintech company that is disrupting the existing car financing market using machine learning algorithms — announced it has secured an additional $150 million in debt and equity financing. The equity funding round was led by 83North with significant participation from existing investors.

The debt funding was led by BHI, ConnectOne Bank, IDB Bank, Viola Credit, and a large insurance company. And this raise follows $30 million in debt funding that was completed about a year ago.

Powered by machine learning and proprietary algorithms, Lendbuzz’s financing model allows it to better assess the creditworthiness of consumers with limited U.S. credit history who are underserved by traditional banks despite their potentially high creditworthiness.

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“This is a significant step forward for Lendbuzz. The capital will allow us to further accelerate our fast-growing car financing platform and enhance our ability to provide the best terms to borrowers that do not have an established U.S. credit history,” said Lendbuzz co-founder and CEO Amitay Kalmar.

And by operating within the auto lending space, the company partners with auto dealerships to offer customers attractive financing solutions. Lendbuzz’s unique solution helps consumers obtain financing when purchasing a car which in turn also helps build their U.S. credit score.

“We developed a unique underwriting platform based on alternative data points to evaluate credit risk. Our AutoML Deep Neural Network (DNN) system is continuously improving and allows us to evaluate the true credit risk for people with a limited credit file or missing FICO score,” added Lendbuzz co-founder and CTO Dr. Dan Raviv.

Lendbuzz enables auto dealerships to close on additional business opportunities, which otherwise would have been lost and serve a more diversified client base. And last year, Lendbuzz’s loan origination grew 320% and the company increased its dealership network across the country to include key markets like California and Florida.

“After backing some of the world’s leading fintech companies, we are very excited to join Lendbuzz and support their ambitious growth plans,” explained Arnon Dinur — Partner at 83North. “Lendbuzz is addressing a large and underserved market, has innovative technological underwriting capabilities and unique customer acquisition strategy that supports their high growth.”

There are an estimated 43 million foreign born nationals living in the U.S., of which 27 million are working professionals. And Lendbuzz is tapping into the large market thus providing credit solutions for customers with solid financial backgrounds who find themselves without proper credit solutions.

“BHI started its banking relationship with Lendbuzz in 2018 and is excited to continue to support the company’s growth into an influential fintech company,” noted Gabriel Hamani — CEO of BHI. “The technology sector is core to BHI’s expansion strategy in the U.S., and we understand the complexities of the tech ecosystem. We’re committed to providing tailored banking solutions and an innovative suite of products to entrepreneurs within the tech sector.”