News Pod #25 - Happen Bank Is Running Chime's Playbook In Reverse

I'm gonna summarize this week's newsletter piece.

So last Tuesday, Scott Sandberg rang the NASDAQ opening bell and LendingClub officially announced ended so the company now now trades is happen inc under the ticker hapn and they just completed that full rebrand to happen bank and they actually changed from the nysc to the nasdaq so i'm not sure the details behind that but american banker covered it and you can check that out We link to it in the article.

We originally covered this announcement in April.

So you might be wondering why we came back to cover it again now that it's not so new and fresh.

And we think there's an interesting story here layered underneath that rebrand.

So we think it's a clean example of a lender picking a customer segment first and then engineering every product, reward, dollar of funding around that user in that segment.

So if you market lending or deposit products, which I know a lot of our audience does, we think this is worth a few minutes to unpack.

So first, what happened to LendingClub? So first of all, just to give you an idea of the scale here, 5 million plus lifetime vendors from LendingClub and NowHappen and $100 billion plus in lifetime originations.

We sourced that from a 2025 10K that they filed.

So you may remember LendingClub as a P2P lending pioneer.

That company hasn't existed for a long time.

I remember I was at Capital One during these days Remember originally hearing about Lending Club.

And actually, I think Eva even logged in, created an account and started to look at what it might feel like to actually invest in one of those loans.

So they were offering these really high yields as a saver.

And then the model was they would pair the investor slash saver to the borrower and effectively taking out the middleman, quote unquote.

That didn't end up being their destination business model.

Today, they're a nationally chartered bank running a marketplace model with two core revenue engines.

The first is balance sheet lending, pretty standard for lenders.

Deposit funded loans are held for investment and then they generate net interest income.

And then the second is a marketplace.

So they originate loans, sell them to investors, collect origination fees, servicing fees, and then gains on the sales of that capital light fee income.

So LoanBook is overwhelmingly consumer today on secure personal loans, things like think like debt consolidation, I think is a core, they also do auto refinance, point of sale financing, and a newly launched home improvement vertical.

They also have a small commercial book focusing primarily on small business or what they're calling SBA lending, while existing commercial real estate loans and equipment leases have ceased originations and are being retained to maturity.

So in Q1, the originations were split roughly down the middle.

52% sold to marketplaces, marketplace investors, and 48% retained on book.