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[Investar]

Prosper's Third Quarter 2009 Financial Statement
http://www.sec.gov/Archives/edgar/data/1416265/000141626509000247/0001416265-09-000247-index.htm

Consolidated Statements of Operations (pg 2) shows a net <loss> of $2,238,138 in the quarter. The cash burn was $746,000 per month on average. That's quite an improvement from the drain during "Quiet" but considerably worse than the same period last year when they were operating 'full tilt bogey' in all 50 states. The net <loss> in the third quarter of 2008 was $676,000. They are missing $70,000 a month in their revenue stream compared to the same period last year.

A before and after comparison is not quite apples and apples. Shut down did not occur until October 15, 2008 (beyond '08 Qtr 3) and restart did not occur until July 13, 2009 (within '09 Qtr 3).

«Lobby okay»

[NewHorizon]

Cash and cash equivalents as of 9/30/09: $2,079,624

I think they'll continue to dial back the burn rate just a bit.  That, plus the $1 million from Mr. Morris, put Prosper on a trajectory to run out of money around the end of February or early March.

Or Prosper could just keep adding board members indefinitely, I suppose - each one tossing in $1mil.

[God-Father]

Maybe MJerry will be next.

[pacino58]

Weighted Average Default Rate 7.40%

From the management discussion and analysis section.

One thing that is interesting from the 10-Q is that Prosper expects that 7.40 of loans will default.  Based on a historical comparision, this would seem a little low considering they have not implemented many new collection techniques and are still working on developing these items.

Maybe they advertise this fact somewhere besides the 10-Q?

[pacino58]

Here are a few other good ones:

We intend to vigorously defend the class-action lawsuit and vigorously prosecute our suit against Greenwich.

Typical language, I would believe.

Prosper is obligated to indemnify lenders and repurchase certain loans and Notes sold to lenders in the event of Prosper’s violation of applicable federal, state, or local lending laws, or verifiable identify theft.

Prosper could be admitting fault here because they do refer to both loans and Notes.

[NewHorizon]

Is it me, or do all lawyers use the word "vigorously" when describing their open case?

For grins, Google "vigorously defend" or "vigorously prosecute".

Are they all taught this word on the first day of their Lawyer-101 class or something...?

[TotoMMB]

Is it me, or do all lawyers use the word "vigorously" when describing their open case?

For grins, Google "vigorously defend" or "vigorously prosecute".

Are they all taught this word on the first day of their Lawyer-101 class or something...?

I don't want to be on the side that's "casually" defending or prosecuting. Hope that's my opponent.

[cubbiesnextyr]

Is it me, or do all lawyers use the word "vigorously" when describing their open case?

For grins, Google "vigorously defend" or "vigorously prosecute".

Are they all taught this word on the first day of their Lawyer-101 class or something...?

It's got to be taught in Law 101...

Headline and byline of WSJ opinion piece today...
The KSM Trial Will Be an Intelligence Bonanza for al Qaeda
The government will have to choose between vigorous prosecution and revealing classified sources and methods.

[HollowOak]

Is it me, or do all lawyers use the word "vigorously" when describing their open case?

For grins, Google "vigorously defend" or "vigorously prosecute".

Are they all taught this word on the first day of their Lawyer-101 class or something...?

As opposed to "languorously"  - the way they did with the NAT loans.

[Nora_Lenderbee]

Is it me, or do all lawyers use the word "vigorously" when describing their open case?

For grins, Google "vigorously defend" or "vigorously prosecute".

As opposed to "languorously"  - the way they did with the NAT loans.

[Investar]

Just a side note: Prosper's "Filing Date" for this form was 2009-11-16 but it was "Accepted" on 2009-11-13. Interesting. Prosper's report was past due as of 2009-11-14 which was a Saturday. On account of the weekend Prosper needed to hand in their homework a day early. But you can't expect an underachiever to plan that far ahead so the agency kindly marked this newbie 'present' even though they were 'absent'. So let's be clear here, Prosper is not in violation of SEC filing rules.


Who must file:  Form 10-Q must be submitted quarterly by all public companies to the Securities and Exchange Commission. In the 10-Q, firms are required to disclose relevant information regarding their financial position. The form must be submitted on time, and the information should be available to all interested parties.

When:  The 10-Q is due 35 days (it used to be 45 days) after each of the first three fiscal quarters. There is no filing after the fourth quarter because that is when the 10-K is filed. The annual 10-K must be filed with the Securities and Exchange Commission within 60 days after the end of the fiscal year (it used to be 90 days).

Source: http://www.investopedia.com/terms/1/10q.asp

[Investar]

Prosper's report was past due as of 2009-11-14 ...

Actually it was past due on 2009-11-05 if indeed, the "10-Q is due 35 days after each of the first three fiscal quarters." Appears they couldn't even make the old deadline "(it used to be 45 days)".

edit to add this completes the phrase, "day late and dollar short" .. .. we already knew about the dollar. Just so you all know, I'm one of those who really wishes Prosper could get their act together. It's a great thing they set out to accomplish. I still root for them 100% but they make it extremely difficult.

[Beerbud1]

That high priced law firm doesn't believe in being on Time? 

[GLeaderAccountantsChoice]

Prosper assumes a 26.42% weighted average discount rate on its borrower loans across all credit grades (note 4) with a 7.4% default rate.   

PMI's quiet period makes the financial data a little less comparable I believe, but in any case, the gross revenues aren't looking good.  I especially like the advertising and marketing expense in comparison to gross revenues, as the number of loans is highly dependent upon advertising I'd think.  I also love the equity section of the balance sheet as well as that one little line for $22,940 that says repurchase obligation.

The good news with PMI is that they've cut the fat a little (the salaries) but wait, nope... they just spent more on professional services.  Depreciation is down as if they've sold assets (no I didn't read the foot notes or look for that specifically), and their advertising budget has been stripped.

Maybe if they originated, oh, about 20 times more loans than they currently are, they'd see a profit!  Too bad their loan volume under service went from $90 million down to about $42 million between Sept of 2008 and Sept of 2009.

[Investar]

PMI's quiet period makes the financial data a little less comparable I believe, but in any case, the gross revenues aren't looking good ... Maybe if they originated, oh, about 20 times more loans than they currently are, they'd see a profit!  Too bad their loan volume under service went from $90 million down to about $42 million between Sept of 2008 and Sept of 2009.

Yeah, the length of the "Quiet" interruption was unfortunate. Prosper essentially had to rebuild their customer base all over again. Activity on that front is encouraging. But it will remain difficult on the lending side where half of their potential base will remain unavailable for a protracted period of time. Many of the 24 non-lending states have built-in barriers that won't come down without legislative action. Prosper makes their money on up-front borrower fees, of course, but that volume is contingent on lender participation. Last summer there were about 100-150 funded listings waiting to close at any time. This summer just 50 loans were ready to roll at the given moment.

Rosiest scenario I can conjure is that their fresh million buck loan might extend operations two months. Prosper shows that at the end of the quarter they had "Cash and cash equivalents" of $2,079,624. The amount was exclusive of "Restricted cash" and "Borrower Loans receivable" (our new Notes show on their balance sheet because they own them - our old Loans do not). Add the new million to that and 'best lipstick on the pig' says operations can continue 6 months, 1-1/2 of which have already gone by.