LendingClub, with plans to go public, also seeks a buyer

LendingClub Corp., which is backed by investors including Kleiner Perkins Caufield & Byers, is pursuing a dual track process, two sources said.

The peer-to-peer lending company filed to go public in August but is also seeking a buyer, the people said. Goldman Sachs, who is an underwriter on the IPO, is advising on the sale, one of the sources said.

San Francisco-based LendingClub provides a marketplace that connects borrowers and lenders. Since its launch in 2007, the lender has facilitated more than $5 billion in loans. The company provided $98 million in revenue in 2013 while adjusted EBITDA was $15.2 million, regulatory filings said.

In August, LendingClub filed to go publicMorgan Stanley and Citigroup are also underwriters on the deal, the filing said. The company is expected to raise more than $500 million with the IPO at a $5 billion valuation, according to press reports.

“Price expectations on the IPO are so high that I don’t see any strategic buyer who would think about that,” a private equity source said. Private equity would also likely not be interested in LendingClub because the company doesn’t present a “normal PE style multiple,” a second PE executive said.

If LendingClub does well with its IPO, other web-based lenders will likely follow, sources said. On Deck Capital, which provides a platform for small business lending, filed to go public this week. Investors include First Round Capital, Google Ventures and Tiger Global.

In October, LendingClub said it would trade on the New York Stock Exchange under the ticker symbol “LC.” The company, however, has not disclosed how many shares it would sell in its IPO or the offer price. That information will likely come in future offerings.

LendingClub has raised several rounds of funding. Along with Kleiner Perkins, investors include Norwest Venture Partners, Canaan Partners, Foundation Capital and Morgenthaler Venture Partners. Norwest, the largest investor, owns 16.5 percent of LendingClub, while Canaan has 15.9 percent, Foundation Capital has 12.8 percent and Morgenthaler owns 9.2 percent.

In 2012, Kleiner Perkins invested $15 million in the company and currently owns a 4.6 percent stake. John Mack, the former Chairman of Morgan Stanley, invested $2.5 million.

Google, in 2013, took part in a $125 million secondary round, a statement said. Google is not listed in the S-1; the regulatory filing does not show investors with holdings less than 5 percent.

Goldman and Google declined comment. Executives for Lending Club, Morgan Stanley, Norwest, Kleiner Perkins, Canaan, Foundation Capital and Morgenthaler did not return calls/messages for comment.