Aiming to Disrupt Consumer Credit: Al Goldstein, CEO of AvantCredit (Part 3)

Sramana Mitra: Is your offering for any kind of credit or is this for a specific kind of credit?

Al Goldstein: We provide two products today in two markets where we operate in the US and the UK. Our first product is an installment loan product. This type of loan ranges from $1,000 to $20,000 for a period of one to four years. This is a fully amortizing monthly pay product. So customers will borrow, on average, $5,000 and pay it back in monthly equal installments to zero over the term of the loan. These loans have no origination fees or late payment penalties.

We have launched, but are currently testing, a revolving product – a line of credit product – where customers are able to borrow a smaller line of credit. It functions a lot like a credit card, but all of our loans are unsecured. It’s pretty much like personal loans or credit cards.

Sramana Mitra: The money that you work with is your money or is this a peer-to-peer service?

Al Goldstein: At least in the US market today, there really is no peer-to-peer service from a marketing standpoint. There’s what’s called a marketplace model, which is institutional investor-driven. Very few of the loans these days on the platform are being funded by individuals that also buy various hedge funds. We have a hybrid model. We lend a combination of our own capital and we have some institutional partners that will buy loans from us.

Sramana Mitra: Got it. Tell me a bit about how you launched the company. What was the preliminary customer acquisition strategy?

Al Goldstein: We’ve been in business for about two years. We started working on this at the end of 2012 and officially launched in January of 2013. We have not been around for that long, but we’ve gone to quite a massive scale where we’re writing more loans. Our goal is to write more loans in the next six months. Our marketing channels are quite diversified but are online-driven where we look for customers who are looking to transact via the Internet. Our goal is to really provide a better level of service to customers that want to transact in that way.

Sramana Mitra: A bit more granular level there, what is the channel through which people who are looking for credit are finding you?

Al Goldstein: It’s definitely Google PPC and Google organic search. If you look for online loans today on Google, we’ll typically be number one or number two organically. We have lots of affiliate partners that market loans such as companies like Credit Karma and LendingTree. We have referrals from our visiting customers and organic traffic that comes to our site. We do some direct mail campaigns as well.

This segment is part 3 in the series : Aiming to Disrupt Consumer Credit: Al Goldstein, CEO of AvantCredit
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