SoFi, launched in 2011 and based in San Francisco, operates a peer-to-peer lending platform originally linking student borrowers at top-tier universities with alumni lenders. Since launching it has funded $450 million in loans to over 5,000 members, with borrowers saving an average of $9,400 by refinancing their student loans. The platform also provides unemployment protection, career services, and an entrepreneur program offering debt deferment, mentorship, and capital. Alumni lenders on the network earn roughly a 5% return after fees, and consolidated loans for recent graduates are typically offered at fixed rates around 5.99% for amounts up to $200,000. With new capital SoFi plans to expand its offerings into mortgages and personal loans and to provide new avenues for lenders to invest through the platform. Social Finance offers a dedicated lending fund and social platform that connects alumni with students to provide lower fixed loan rates than Federal Direct and PLUS loans. The program combines online and offline alumni-student interactions to support financial literacy, career mentoring and in-school project assistance. SoFi says this model helps reduce lending rates and lower loss rates for student borrowers. Its lending program is available at 78 schools, including Stanford, University of Michigan, Smith and Swarthmore, and the company plans to expand beyond 78 schools this fall. To date SoFi has generated more than $60 million in loan applications and is on a path to commit more than $200 million in student loans in 2012. Mike Cagney is CEO.

Total raised

$157M

Funding rounds

2

Latest round

Equity

Latest activity

Apr 2014