Author Topic: Email from Lending Club  (Read 19745 times)

bcartpa

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Email from Lending Club
« on: June 01, 2016, 10:02:42 PM »
Just got this email from Lending Club about 30 minutes ago.  Looks like a pretty strong statement of commitment to retail investors.


Hello ______,
 
I wanted to check back in.
 
Some of you responded to my first email with a note about your continued support; others of you are talking to our Investor Services team to get your questions answered.
 
The most common question we're getting is this: Are we committed to individual investors?
 
Emphatically, yes.
 
You're the heart of our marketplace.
 
We started Lending Club with the simple but revolutionary idea that we could democratize access to consumer credit. That idea - and our commitment to it - will never change.
 
Our mission is to make people's lives better. That's true for borrowers - helping them get access to responsible credit - as well as investors. We want to help you build your financial future.
 
You've always been the foundation of our marketplace. You helped us start Lending Club in 2007; now our individual investor base is over 150,000 members strong. We've also improved the platform based on your feedback. We created Automated Investing, simplified the IRA investment process, and integrated our platform with TurboTax.
 
We're doubling down on our efforts to serve you. We're staffing up on our Investor Services team and are eager to connect with you to see how you're doing. We're also dedicating more engineering resources to you to ensure you have a great investment experience.
 
We want your ideas on what else we can do.
 
To prove our commitment and thank you for investing with us, we're offering a bonus for new funds transferred to your account by July 15, 2016.1 The more you invest, the bigger the bonus you could receive.

$5,000 - $9,999 - bonus $100
$10,000 - $24,999 - bonus $200
$25,000 - $49,000 - bonus $500
$50,000 - $99,000 - bonus $1,000
$100,000+ - bonus $2,000
 
In the meantime, keep your ideas and questions coming. Our Investor Services team is here to help.
 
Sincerely,
 
Scott Sanborn
Lending Club President & Acting CEO
Individual Investor on Lending Club since 2013 and creator of the P2P Investor Kit, automation software for Lending Club investors: www.p2pinvestorkit.com

RT45

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Re: Email from Lending Club
« Reply #1 on: June 02, 2016, 02:16:17 AM »
I did not receive this email. Do you think they are sending out based on $ amount invested? What type of account did you have?

bcartpa

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Re: Email from Lending Club
« Reply #2 on: June 02, 2016, 08:37:20 AM »
I did not receive this email. Do you think they are sending out based on $ amount invested? What type of account did you have?

I have a regular individual account and have a substantial amount invested.  My pace of investment in new notes has slowed recently.  Not sure if it's my account balance or the change in behavior that triggered the email.  I'm putting more cash into notes for sale on Folio these days as there have been some good deals out there.
Individual Investor on Lending Club since 2013 and creator of the P2P Investor Kit, automation software for Lending Club investors: www.p2pinvestorkit.com

hessinger

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Re: Email from Lending Club
« Reply #3 on: June 02, 2016, 09:43:48 AM »
The most common question we're getting is this: Are we committed to individual investors?

I find that hard to believe if this forum is any indication.

avid investor

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Re: Email from Lending Club
« Reply #4 on: June 02, 2016, 09:59:36 AM »
I got it, too.  Could easily have been triggered by my changed behavior.  I have turned off all 5 of my daily auto-investing cron jobs, which invest in all 4 accounts.  Haven't invested for at least a week.

fliphusker

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Re: Email from Lending Club
« Reply #5 on: June 02, 2016, 01:43:25 PM »
The most common question we're getting is this: Are we committed to individual investors?

I find that hard to believe if this forum is any indication.
The questions that they field are all wrapped into one for the most part.  "Why not BRV?"  LC "We are committed to making profits for an individual investor as we always have."  Thus trying to wrap the individual investor in a security blanket to make them feel safe.  When I think of BRV I always think of the scene in Tommy Boy when he is talking about guarantees.  :)
The 2-3 letters that LC has sent out, is nothing more then assurance that things will go as usual for retail investors. 

Boatguy

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Re: Email from Lending Club
« Reply #6 on: June 02, 2016, 02:09:20 PM »
The questions that they field are all wrapped into one for the most part.  "Why not BRV?"  LC "We are committed to making profits for an individual investor as we always have."  Thus trying to wrap the individual investor in a security blanket to make them feel safe.  When I think of BRV I always think of the scene in Tommy Boy when he is talking about guarantees.  :)
The 2-3 letters that LC has sent out, is nothing more then assurance that things will go as usual for retail investors.
I agree.

I have three substantial accounts and I did get the email, though only to one account.   I agree that it's nothing more than "trust us".  The "we're doubling down" rings hollow when the commitment is to have more customer service people to soothe our complaints and some engineering resources to do what?  Clean up the web site?

We're not looking to be soothed by customer service reps (who are content free in my experience), or new graphics on the web site.  We're looking for tangible changes in the way LC operates and communicates with retail investors.  And the promotional pitch really tells the whole story by unmasking the true motivation for the email.

It's actually quite an Orwellian communication in that LC is claiming to "double down" when in fact they are actually asking retail investors to "double down" by investing more at a time when even continuing to re-invest existing funds with the company is in question.

I'm still giving Mr. Sanborn ninety days to make, or at least announce, a tangible change in their approach to retail investors.  But if he thinks a 2% bonus will cause retail investors to "double down", I think he is mistaken.
« Last Edit: June 02, 2016, 04:51:26 PM by Boatguy »

bobeubanks

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Re: Email from Lending Club
« Reply #7 on: June 02, 2016, 02:27:39 PM »
It's actually quite an Orwellian communication in that LC is claiming to "double down" when in fact they are actually asking retail investors to "double down" by investing more at a time when even continuing to re-invest existing funds with the company is in question.

Orwellian indeed or perhaps Mr. Sanborn has never played blackjack and doesn't actually know what double down mean.

.Ryan.

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Re: Email from Lending Club
« Reply #8 on: June 02, 2016, 11:24:08 PM »
I've stood by LC throughout this whole ordeal, and kept reinvesting all payouts.

I'll be pretty disappointed if I don't receive the offer. Not a good way to reward the ones that supported LC through the past few weeks.

fliphusker

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Re: Email from Lending Club
« Reply #9 on: June 03, 2016, 01:35:48 AM »
I've stood by LC throughout this whole ordeal, and kept reinvesting all payouts.

I'll be pretty disappointed if I don't receive the offer. Not a good way to reward the ones that supported LC through the past few weeks.
Check your spam folder, no doubt why most have not go LC letters.  I am sure it will be posted on LC's page.  I am sure you will not have to put in a code. 

nmay2k

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Re: Email from Lending Club
« Reply #10 on: June 03, 2016, 07:00:38 AM »
I believe this offer is for non-IRA accounts, so if that is the only account you have that could explain why you did not see the offer.   

I am sure if you were about to transfer $5000 to your LC account to invest, you can call them and ask about the bonus. But I suspect they already emailed the folks most likely to do so. For example, if you pulled $5000 out in the last month, you may not be on the DL. 

I am definitely thinking about this one.

DLIFVOIP

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Re: Email from Lending Club
« Reply #11 on: June 03, 2016, 09:33:22 AM »
The questions that they field are all wrapped into one for the most part.  "Why not BRV?"  LC "We are committed to making profits for an individual investor as we always have."  Thus trying to wrap the individual investor in a security blanket to make them feel safe.  When I think of BRV I always think of the scene in Tommy Boy when he is talking about guarantees.  :)
The 2-3 letters that LC has sent out, is nothing more then assurance that things will go as usual for retail investors.
I agree.

I have three substantial accounts and I did get the email, though only to one account.   I agree that it's nothing more than "trust us".  The "we're doubling down" rings hollow when the commitment is to have more customer service people to soothe our complaints and some engineering resources to do what?  Clean up the web site?

We're not looking to be soothed by customer service reps (who are content free in my experience), or new graphics on the web site.  We're looking for tangible changes in the way LC operates and communicates with retail investors.  And the promotional pitch really tells the whole story by unmasking the true motivation for the email.

It's actually quite an Orwellian communication in that LC is claiming to "double down" when in fact they are actually asking retail investors to "double down" by investing more at a time when even continuing to re-invest existing funds with the company is in question.

I'm still giving Mr. Sanborn ninety days to make, or at least announce, a tangible change in their approach to retail investors.  But if he thinks a 2% bonus will cause retail investors to "double down", I think he is mistaken.

Below is my reply to his email.  More should write their own email and send it.

Dear Scott,

While your below gesture is appreciated, it does not really do much for the retail investor.  I love a deposit bonus as much as the other guy, but lets be honest, this really helps Lending Club more than it helps the retail investor.  You need new deposits due to the slowing of institutional investors and this is a good way to get those new funds. 

One of the real issues facing retail investor is facing is loan volume.  Or should I say lack of loan volume relating to what most of us who have been doing this for a while would call “quality” loans.  A vast majority of volume is still being funneled to the institutional or whole loan market.  That only serves to limit the volume of loans available to the retail investor.  Lending Club needs to make 100% of loans available to the retail investor and then give the institutional investor / whole loan market the leftovers that we as retail investors are not funding.  If the institutional investors say they only want whole loans, internally you can simply split the borrowers loan into a retail and “whole” loan.  It is bit more programming for your guys, but that would really show the retail investor you care.

Secondly, I am guessing that the most common question you are getting really relates to a Bankruptcy Remote Vehicle for the retail investor.  We do not need you to double down on efforts to serve us, you have great customer service, the website is fine, folioFn is fine.  We need the same level of protection you are providing to the institutional investor or the same level of protection your competition is providing to its retail investors.  Your below offer is simply asking the retail investor to take more risk without any further reassurance that we will be protected. 

At the end of the day Lending Club needs to do something for the retail investor that only benefits the retail investor and I truly believe the only answers are to first offer 100% of loans to retail investors and second provide retail investors with a BRV.

Again, I appreciate the proactive steps you are taking, but think that Lending Club gains from it more than those you are saying you care about.

SLCPaladin

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Re: Email from Lending Club
« Reply #12 on: June 03, 2016, 10:24:32 AM »
I received this email yesterday as well. Here are my thoughts:

1. This offer is certainly better than a sharp stick in the eye, but it essentially skirts the issue that, I believe, is top-of-mind for most retail investors. I actually quite appreciate that there is some sort of enticement to lure back skittish retail borrowers. It shows that management is actively trying to reach out. What's more, adding 2% to my yield is nothing to sneeze at. But at the end of the day, like many on this forum have pointed out, the offer doesn't address the fundamental issue of no BRV being in place for the retail investor. When I analyze my own financial situation, this is still the overarching concern which prevents me from returning to buying loans. As great as this 2% may be, the "unknown unknowns" (it's the uncertainty, stupid) of what my notes would look like if things get ugly fast outweighs a 2% bump in yield. That is how I see it, anyway. Others may feel different, or have a different risk tolerance.

2. While this may not lure me back to reinvesting, let alone incite me to deploy large amounts of new capital, hopefully this carrot is sufficient for enough retail investors to prevent a massive funding shortfall that creates a further self-defeating crisis of confidence. Let's face it, what we're essentially dealing with is a classic run on the bank, or crisis of confidence. I don't think there are any major systemic issues (although I could be wrong) that suddenly went into play a few weeks ago. If all institutional investors and retail investors suddenly decided to start reinvesting all at once, then the RL affair and all the drama that it entails would be a blip on the radar screen. What we are dealing with is a crisis of confidence. The FDIC is in place to prevent bank runs. A BRV is the type of vehicle that is needed to prevent a crisis of confidence for some segment of retail investors. When all is said and done, this RL debacle could turn out to be a blessing in disguise in that it awakens the board and upper-management to the need to think long and hard about funding sources in crises situations. When Mario Draghi promised to "do whatever it takes" to stop the Euro-zone crisis, it had the intended effect of stopping the panic and prevented the ECB from doing a lot more. Mr. Sanborn needs to heed lessons from the past 8-9 years and come out with what is effectively bazooka, not just an enticement to pad returns. In a panic, investors are more interested in return of investment than return on investment.

3. I don't see what is happening behind the scenes. I don't know what the temperature is among other retail  investors, or what funding shortfalls may, or may not, exist. It may very well be that many retail investors are somewhat oblivious to what has transpired in the past few weeks and are reinvesting as if nothing ever happened. I may be a minority voice, I don't know for sure. If this is the case, then the 2% enticement may essentially do the trick. LC has all the data on their investors and they can measure the impact of their communication and offer. If this is enough to right the ship, then maybe LC is right to focus on the silent majority and not the vocal minority. If, however, this forum is a proxy for a wider cross-section of LC investors, LC may need to rethink their approach to shoring up confidence.
« Last Edit: June 03, 2016, 10:30:34 AM by SLCPaladin »

bcartpa

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Re: Email from Lending Club
« Reply #13 on: June 03, 2016, 10:26:27 AM »
Quote
A vast majority of volume is still being funneled to the institutional or whole loan market.  That only serves to limit the volume of loans available to the retail investor.  Lending Club needs to make 100% of loans available to the retail investor and then give the institutional investor / whole loan market the leftovers that we as retail investors are not funding. 

I am curious why you think we (retail investors) deserve the "pick of the litter" and the institutional investors deserve the leftovers?  I can see an argument for equal access but I'm curious what basis we have for getting better access than the "big money."

I would love if this were the case, as it certain serves my interests.  But I've not felt I had an argument for this in my conversations with Lending Club.  So I'm curious what I might be missing from your argument.
Individual Investor on Lending Club since 2013 and creator of the P2P Investor Kit, automation software for Lending Club investors: www.p2pinvestorkit.com

nmay2k

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Re: Email from Lending Club
« Reply #14 on: June 03, 2016, 01:09:39 PM »

1. about BRV, if prosper has it then go there. I am not sure there is any reason to start BRV at LC. If you want a burger, go to the burger joint.

2. This is not a run on the bank (especially if you don't think there are any systemic issues). Like stocks, these are not FDIC insured and everyone was fully aware of the risk when investing so no need to change the rules in the middle of the game. You want FDIC insurance go to the FDIC insured joint.

3. All LC needs is more retail investment. This is our queue to step-in the game and show them what we are made of. Do we believe in the p2p model or not? Do we believe in it only if it is insured against loss? Do we believe it whether there is a 2% bonus or not?

4. I don't think retail investors should be second class to institutional investors. Institutional investors have bank charters and can lend money out themselves, but they are too lazy to do it can conveniently mooch off LC. They get the tax breaks we don't on the same returns. Why should we be the second class citizens here? We are the p2p, we are the ones paying the premiums (taxes) to use this. We are the ones picking the loans 1 by 1 versus using the robots. We are the one sitting down at the pc every 4 hours to invest in loans. We are the ones getting the lower class loans because we are not using the API to suck up the loans faster than you can say go. We are the foundation to this whole thing. Without retail, by definition there is no p2p.