Kennesaw, Ga.-based startup LendingPoint has made its first acquisition since launching four years ago.
The company has acquired LoanHero, a financial technology platform for point-of-sale finance based in La Jolla, Calif., for an undisclosed sum.
LoanHero provides instant financing of $1,000 or more to a merchant’s customer at the point of sale, while LendingPoint provides personal loans to near-prime borrowers. Both companies began operations in 2014. According to Crunchbase, LoanHero has attracted $24.6 million in total funding. But $20 million of that figure is a debt facility obtained in 2015 to finance consumer loans.
“LoanHero’s merchant platform is the perfect complement to our consumer portfolio,” LendingPoint co-founder and CEO Tom Burnside said in a statement. “The combination of the two companies doubles our origination channels and current customer base and triples the number of consumers we can serve with credit and payment solutions for folks with credit scores from 450 all the way to 850.”
Since its inception, LendingPoint’s business model has focused on borrowers with credit scores of 600 to 700. The company said LoanHero accelerates its expansion into point-of-need and point-of-sale financing.
Last year, LendingPoint struck a deal with ezVerify, a Miramar Beach, Fla.-based healthcare information technology company, to make it easier for medical patients to get loans to cover out-of-pocket medical expenses. The partnership created ezCarePoint to process loans before a procedure is performed.
Later in the year, LendingPoint announced that it secured a $500-million credit facility through Guggenheim Securities. The company, which operates in 32 states and the District of Columbia, said that between itself and LoanHero, 70,000 consumer loans totaling $500 million have been issued.
“Backed by LendingPoint’s powerful technology and expertise, we look forward to helping practices, contractors, retailers and many other businesses grow by providing innovative credit solutions for their customers,” Zalman Vitenson, chairman and CEO of LoanHero, said in the announcement.