App based Lending Platform Lenmo Seeks Up to $3 Million on SeedInvest

Lenmo, an alternative lender that is a marketplace for investors to fund loans all on an App, is raising up to $3 million on SeedInvest.

Lenmo is a small-dollar lender that will provide credit when banks say no as it will accept subprime borrowers – ostensibly at a better rate than some other lenders.

For borrowers, you choose the amount and the term and multiple lenders compete for your loan. Investors (lenders) include financial institutions, lending businesses, and individual lenders. While still small, Lenmo reports having originated over $1.2 million in loans to date for 5000+ individuals. By connecting to friends and families via Facebook, a borrower can easily tap into their personal network to borrow the money from known people.

Currently, Lenmo loans are single peer to peer – meaning you cannot invest in fractions of loans. You can choose varying risk/return levels.

Of note, Lenmo says that Lenmo Enterprise, a solution designed to make investing in the small loan market already has 45 enterprise signups with another 75 in the pipeline.

Lenmo is another example of the ongoing disaggregation of the traditional banking market.  By removing the middle man, Lenmo may originate loans in a more streamlined process at a lower rate while investors may directly participate in the asset class.

Lenmo makes its money by charging borrowers a 1% fee on the loan principal or a minimum of $3 regardless of interest rate and payback period.

Lenmo is doing a side-by-side Reg CF-Reg D offering on SeedInvest. The “Series Seed” is at a pre-money valuation of $10 million for preferred equity. So far, $102,501 has been raised under Reg D and $2,501 under Reg CF. The minimum target is a raise of $700,000. A year ago, Lenmo did a Seed round of $430,000 at a valuation of $8 million.

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