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[kenL]

I'm guessing they hope to get enough funds recycling through that they can juice the returns then quit the incentives. With RR and WB2 in over $1M each, I think they may be a better marketing ploy than incentives. Get the masses thinking: "Hell, if these two are playing with that much, what's the harm in dropping $100?". That $100 becomes $120, which all gets reinvested, and so on.

+1

[Mark12547]

I think the most important lesson they learned is that lenders need to be happy. If lenders are not happy, Prosper will fail and I think they know that now.

Have they learned that? If so, it would go against all my experience with them.

[ResearchPro]

I think the most important lesson they learned is that lenders need to be happy. If lenders are not happy, Prosper will fail and I think they know that now.

Have they learned that? If so, it would go against all my experience with them.

I'm sure we saw it from here, but did they learn it too? What you consider as indication that they did?

[kenL]

I think the most important lesson they learned is that lenders need to be happy. If lenders are not happy, Prosper will fail and I think they know that now.

Have they learned that? If so, it would go against all my experience with them.

I'm sure we saw it from here, but did they learn it too? What you consider as indication that they did?

The biggest indicator is current lenders' returns. Also, the fact that the returns that Prosper advertises are now based on real data and the fact that their calculations of those returns are transparent are also big indicators.  Now you can actually see how they calculate their returns and I think in certain blog post they walk you through the calculation. I'm not sure, but maybe they do that in the risk analysis reports. In those reports it is quite apparent to me that they are not attempting to fool anyone or pull any wool over anyone's eyes. But that is just my opinion and my own analysis of their data seems to verify their findings.

[Fred93]

Does anyone know if that makes this a down-round?

http://fred93blog.blogspot.com/2011/06/prospercom-series-e-financing-analysis.html

04/2005, Series A, 4,023,999 shares for $7,464,450, or $1.875 per share.
02/2006, Series B, 3,310,382 shares for $12,412,301 or $3.776 per share.
06/2007, Series C, 2,063,448 shares for $19,919,009 or $9.692 per share.
04/2010, Series D, 20,340,705 shares for $14,700,000 or $0.723 per share.
06/2011, Series E, 23,222,747 shares for $17,150,000 or $0.739 per share.

But they paid a $375,000 fee to an agent for rounding up the series E investors.  If you count that it comes to $0.722/share.

[mothandrust]

I think the most important lesson they learned is that lenders need to be happy. If lenders are not happy, Prosper will fail and I think they know that now.

Prosper does not and can not promise a rate of return for lenders any more than NYSE and Nasdaq can promise investors that their stocks will go up.

What they can and should do is...

-Respond to customer service issues promptly (but now they ignore e-mails)
-Eliminate fraud and scams (but they do even less verification than they used to)
-Abide by contracts (but they break agreements when convenient for them)
-Correct past wrongdoing (but they "vigorously defend" the class action lawsuit)

What Prosper has learned is to find new lenders that haven't been burned yet, and offer them "loans" which are unsecured obligations of the Company.

[no-whammies]

Does anyone know if that makes this a down-round?

http://fred93blog.blogspot.com/2011/06/prospercom-series-e-financing-analysis.html

04/2005, Series A, 4,023,999 shares for $7,464,450, or $1.875 per share.
02/2006, Series B, 3,310,382 shares for $12,412,301 or $3.776 per share.
06/2007, Series C, 2,063,448 shares for $19,919,009 or $9.692 per share.
04/2010, Series D, 20,340,705 shares for $14,700,000 or $0.723 per share.
06/2011, Series E, 23,222,747 shares for $17,150,000 or $0.739 per share.

But they paid a $375,000 fee to an agent for rounding up the series E investors.  If you count that it comes to $0.722/share.

Were agent fees paid and accounted for in previous rounds?  54 million poofs and counting...

[kenL]

I think the most important lesson they learned is that lenders need to be happy. If lenders are not happy, Prosper will fail and I think they know that now.

Prosper does not and can not promise a rate of return for lenders any more than NYSE and Nasdaq can promise investors that their stocks will go up.

What they can and should do is...

-Respond to customer service issues promptly (but now they ignore e-mails)
-Eliminate fraud and scams (but they do even less verification than they used to)
-Abide by contracts (but they break agreements when convenient for them)
-Correct past wrongdoing (but they "vigorously defend" the class action lawsuit)

What Prosper has learned is to find new lenders that haven't been burned yet, and offer them "loans" which are unsecured obligations of the Company.

All good points, but I thought they now verify income on all borrowers, which is much better than what they used to do and that surely helps returns.

[kenL]

Does anyone know if that makes this a down-round?

http://fred93blog.blogspot.com/2011/06/prospercom-series-e-financing-analysis.html

04/2005, Series A, 4,023,999 shares for $7,464,450, or $1.875 per share.
02/2006, Series B, 3,310,382 shares for $12,412,301 or $3.776 per share.
06/2007, Series C, 2,063,448 shares for $19,919,009 or $9.692 per share.
04/2010, Series D, 20,340,705 shares for $14,700,000 or $0.723 per share.
06/2011, Series E, 23,222,747 shares for $17,150,000 or $0.739 per share.

But they paid a $375,000 fee to an agent for rounding up the series E investors.  If you count that it comes to $0.722/share.

I'm not sure what the right term is, do we then call this a par-round?

[ira01]

Does anyone know if that makes this a down-round?

http://fred93blog.blogspot.com/2011/06/prospercom-series-e-financing-analysis.html

04/2005, Series A, 4,023,999 shares for $7,464,450, or $1.875 per share.
02/2006, Series B, 3,310,382 shares for $12,412,301 or $3.776 per share.
06/2007, Series C, 2,063,448 shares for $19,919,009 or $9.692 per share.
04/2010, Series D, 20,340,705 shares for $14,700,000 or $0.723 per share.
06/2011, Series E, 23,222,747 shares for $17,150,000 or $0.739 per share.

But they paid a $375,000 fee to an agent for rounding up the series E investors.  If you count that it comes to $0.722/share.

I'm not sure what the right term is, do we then call this a par-round?

Whatever we call it, the Series C investors sure must feel like idiots.   

[TotoMMB]

Does anyone know if that makes this a down-round?

http://fred93blog.blogspot.com/2011/06/prospercom-series-e-financing-analysis.html

04/2005, Series A, 4,023,999 shares for $7,464,450, or $1.875 per share.
02/2006, Series B, 3,310,382 shares for $12,412,301 or $3.776 per share.
06/2007, Series C, 2,063,448 shares for $19,919,009 or $9.692 per share.
04/2010, Series D, 20,340,705 shares for $14,700,000 or $0.723 per share.
06/2011, Series E, 23,222,747 shares for $17,150,000 or $0.739 per share.

But they paid a $375,000 fee to an agent for rounding up the series E investors.  If you count that it comes to $0.722/share.

I'm not sure what the right term is, do we then call this a par-round?

Whatever we call it, the Series C investors sure must feel like idiots.   

Hopefully they paid in BITCOINS.

[christoofar215]

I think the most important lesson they learned is that lenders need to be happy. If lenders are not happy, Prosper will fail and I think they know that now.

Prosper does not and can not promise a rate of return for lenders any more than NYSE and Nasdaq can promise investors that their stocks will go up.

What they can and should do is...

-Respond to customer service issues promptly (but now they ignore e-mails)
-Eliminate fraud and scams (but they do even less verification than they used to)
-Abide by contracts (but they break agreements when convenient for them)
-Correct past wrongdoing (but they "vigorously defend" the class action lawsuit)

What Prosper has learned is to find new lenders that haven't been burned yet, and offer them "loans" which are unsecured obligations of the Company.

All good points, but I thought they now verify income on all borrowers, which is much better than what they used to do and that surely helps returns.

You mean they started asking borrowers to fill out IRS Form 4506-T?

When did they start doing that?


You know, American Express randomly forces its borrowers to file 4506-Ts when they trigger an F/R (financial review).   Prosper can easily do this.  It can partially fill out the form and then the borrower's listing won't be eligible for bids until the IRS forms come back.

They can pay a Mexican in the back room to take the transcripts that come in the mail and punch in the reported AGI and then tell Prosper lenders that the income has actually been verified with a third party (this borrower told the IRS they made $X and we verified it).

[kenL]

Does anyone know if that makes this a down-round?

http://fred93blog.blogspot.com/2011/06/prospercom-series-e-financing-analysis.html

04/2005, Series A, 4,023,999 shares for $7,464,450, or $1.875 per share.
02/2006, Series B, 3,310,382 shares for $12,412,301 or $3.776 per share.
06/2007, Series C, 2,063,448 shares for $19,919,009 or $9.692 per share.
04/2010, Series D, 20,340,705 shares for $14,700,000 or $0.723 per share.
06/2011, Series E, 23,222,747 shares for $17,150,000 or $0.739 per share.

But they paid a $375,000 fee to an agent for rounding up the series E investors.  If you count that it comes to $0.722/share.

I'm not sure what the right term is, do we then call this a par-round?

Whatever we call it, the Series C investors sure must feel like idiots.   

Agreed.

[frinxor]

Hopefully they paid in BITCOINS.

 

[ira01]

You mean they started asking borrowers to fill out IRS Form 4506-T?

I strongly suggested that Prosper do that way back in mid-2007.  Of course, Prosper blew me off, as they did with pretty much any idea to protect lenders.