The Capital Markets Practice of Bridgeforce LLC, a specialized consulting
firm in the lending and payments industry, is releasing the second of
a multi-part special report on the trending technology-enabled alternative
lending business. Recent IPO's of two alternative lenders have brought
heightened interest in this market sector.
The paper, titled "Alternative Lending Market: A Valuation Perspective"
categorizes alternative lenders into three segments, highlighting the
advantages claimed by each group, and points out the structural differences
that make comparable valuations difficult. While technological advantages
by these companies and the potential for greater market penetration likely
warrant incremental valuation consideration over traditional lenders,
the magnitude of current valuation differences may be uncorroborated.
These differences will likely be balanced over time as valuation considerations,
currently emphasizing technological benefits, begin to give greater weight
to traditional factors including:
- Management lending and banking experience, especially in early start-ups;
- Portfolio management experience, both on or off book;
- Compliance and regulatory management, as the industry draws more regulators' scrutiny;
- Balance sheet assessment, currently in early stages, starts to mature.
"Technology-enabled alternative lenders, while still representing
a small portion of consumer and small business lending, have already had
considerable impact on the industry. Although their current valuations
may shrink over time, we are already seeing trending changes across all
lending platforms as a result of the innovations they are bringing,"
says Greg Rigg, Director of Bridgeforce Capital Markets.
To learn more about the Bridgeforce Special Report Series, please contact
John Sanders, jsanders(at)bridgeforce(dot)com, +1 302.438.1382.
For more information about Bridgeforce LLC, go to
Bridgeforce is a specialized multi-national consulting firm serving a
variety of clients involved in almost all aspects of the consumer and
small business lending and payments space. Over 75 percent of Bridgeforce
consultants come directly from client-side leadership positions across
multiple parts of the credit lifecycle. Combined with subject matter expertise
in operations, technology, strategy and regulatory issues, Bridgeforce
has the knowledge and experience to make the hard choices in developing
and implementing best-fit solutions that are both achievable and lower
the risks of execution to ensure sustainability. Bridgeforce success can
be attributed to a culture fostering innovation and evolving experienced-based
best practices recognized within the industry. For more information, visit