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Arianna Huffington joins peer-to-peer company Payoff
Financial Times, Jan 28, 2015





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Arianna Huffington, president and editor-in-chief of Huffington Post Media Group, has become the latest high-profile name to join the burgeoning peer-to-peer lending sector.

Ms Huffington joins the board of Payoff, one of a clutch of “P2P” lenders that are emerging to compete in an industry dominated in the US by Lending Club and Prosper.

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P2P lenders, also known as marketplace lenders, aim to use online platforms and data-driven underwriting to directly connect investors with borrowers, thereby cutting out big banks and credit card companies.

Payoff differs from many competitors in that it also plans to use behavioural science to evaluate and potentially improve on borrowers’ willingness to repay their debt.

Ms Huffington, who has made an undisclosed investment in Los Angeles-based Payoff, said she joined the company because she believes in the need to “reshape” the financial services industry.

“Where I see benefits in marketplace lending is where credit is coupled with the right support for the borrower to better manage or reduce their debt and move forward in their life,” she said.

She has previously encouraged Americans to move their money out of “too big to fail” banks and has voiced concern about the future of the US middle classes as they grapple with higher debt levels.

“Arianna is a disrupter and an agent for change,” said Scott Saunders, Payoff’s founder and chief executive. “She offers a strong perspective on the state of the middle class and some of the embedded issues in the financial services industry.”

The P2P sector has sought to quicken its growth through the recruitment of big names from the world of finance and business. Payoff has won backing from Mohamed El-Erian, the former Pimco chief executive, as well as Joe Saunders, the former chief executive of Visa.

The board of Lending Club, the biggest marketplace lender in the US, is peppered with financial luminaries including Lawrence Summers, the former US Treasury Secretary, John Mack, the former Morgan Stanley chief, and Mary Meeker, the internet analyst at Morgan Stanley.

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Vikram Pandit, former Citigroup chief executive, has invested in Orchard, a secondary trading platform for P2P loans, while Duncan Niederauer, the former head of NYSE Euronext, is an adviser to SoFi, a P2P lender that specialises in student loans.

Greek-born Ms Huffington, 64, has used The Huffington Post to boost her public profile in the years since she sold the online news and commentary site to AOL for $315m in 2011.

The site, first founded in 2005 as a platform for left-leaning bloggers, draws nearly 100m monthly visitors and has expanded to India, the Middle East, Europe and Brazil.




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