Avant, an online lender, has offered the option for buyouts to all 760 of the company’s employees. It was not clear how many Avant employees would accept the offer. The news is a painful reminder that online lending is still struggling to regain its footing following indications of a slowing economy and the unexpected departure of former Lending Club CEO Renaud Laplanche – a now tarnished industry icon.
Last week, the Chicago Tribune reported that Avant was slashing staff as forecasts in loan volumes continued to decline. Avant is not alone in jettisoning employees, Lending Club and Prosper, two of the largest marketplace lending platforms, have both experienced “redundancies” in past weeks.
Avant has been a bright spot in the Chicago Fintech scene described as a “rare” midwestern Unicorn. Crowdfund Insider heard chatter last month that Avant founder and CEO Al Goldstein was making the rounds speaking with potential funding channels.
MarketWatch reported today that Avant said uncertainty in the capital markets, and online lending volatility in general, were the cause of its struggles.
While many online lenders have struggled of late most industry followers recognize the demand for credit remains strong. Lending Club stated last month that many of their investors have already returned to the fold.
While these recent hurdles have challenged the online lending industry some observers expect the industry to rise to become even stronger once the dust settles.