Avant, the online lender that offers funds to consumers with less than stellar credit, has garnered debt financing from a series of big banks, Fortune reported on Thursday (Aug. 20).
The roster of large financial institutions behind Avant’s total of $339 million in debt raised includes marquee names such as JPMorgan, Jefferies and Credit Suisse ($139 million from Jefferies; $200 million from JPMorgan and Credit Suisse).
The latest debt issuance brings the Avant capital structure to $1.1. billion in total debt, with an additional $334 million raised in equity financing. As Fortune noted, the company’s business model differs from peers such as Lending Club in that Avant makes its loans from the capital that is already on its books.
In an interview with Fortune, Al Goldstein, the chief executive officer of Avant, said that the company has its sights set on lending to the middle class in the United States and the United Kingdom, with a loan portfolio that would range from $1,000 to $35,000 and have an average loan size of about $8,000. The executive said that in 2015 the company projects it will lend $2 billion, which is four times the amount that it loaned last year.
As Fortune noted, the Jefferies' debt sale represents a bit of a change, in that a large bank will be selling the debt to outside parties, and it is also the first time Avant loans are being securitized by an outside party — specifically a financial entity.
Goldstein said that his company will eventually expand beyond its niche of smaller personal lending to embrace auto loans, credit cards and even mortgages. And for those eager to see an initial public offering, that could indeed be on the horizon but not in the near term.