Lending Club on Thursday became the first online peer-to-peer lending startup to trade publicly and California’s largest initial public offering of the year, immediately jumping 65 percent on its Wall Street debut and marking a bellwether event for the fledgling internet loan industry.
Lending Club charged onto the New York Stock Exchange at $24.75 per share, a $9.75-per-share increase from the price set the night before, a surge that helped calm the stock market one day after a deep slide. Shares closed at $23.43, up $8.43.
Lending Club sold 57.7 million shares and raised at least $865.5 million in the much-anticipated debut, becoming the largest initial public offering from California this year — and just a few years after the startup was panned by critics as a subversive loan company looking to scam people.
At the opening trading price, Lending Club’s market value reached $8.9 billion.
The startup joined an unusually busy December for public offerings and the record IPO class of 2014, becoming the 18th-largest of more than 264 deals in the U.S. this year, according to market-intelligence firm Ipreo.
Lending Club founder and chief executive Renaud Laplanche has said he didn’t take the company public only to raise capital; rather, he wanted to become a public company to gain national exposure and attract more consumers outside his tech-savvy hometown.
Lending Club is an internet marketplace that connects lenders with people who need money, using web tools to provide an instant risk assessment of the person asking for money. Much in the way eBay connects buyers and sellers, Lending Club is a marketplace where lenders and borrowers connect online, rather than making loans directly. It has facilitated $6.2 billion in loans since 2007.