I know, I know, now that lenders are getting good returns, returns are no longer the issue. Do I have that right?
Returns have never been the issue. It has always been management and their refusal to abide by their fiduciary duties and their willingness to ignore the terms of their contracts with the lenders.
Ira and I and many others all quit lending on Prosper while our ROIs were still positive.
+1 on all of the above, including my positive ROI. I publicly quit lending when Prosper took one of its increasingly anti-transparent moves in September or October 2007. At the time, IIRC, Lendingstats had my ROI at around 7%. Even Ken's current site shows me with a positive ROI back then.
Yup, that's right.
I'm not making any excuses for Prosper, but things were bad back then and they were doing what they could to right a sinking ship. They made plenty of mistakes and Ira and plenty of others have good reason to hold a grudge. If I was an active forum person back then, I probably would have a grudge today too.
God-Father recently posted something like "I'm a greedy investor making money lending to needy people" that pretty much sums up my attitude too. I'm convinced that Prosper has learned from it's mistakes (at least most of them) and now they have a great lending model. Profitability is still far away, but they are light-years closer now then they ever were during 1.0 (because lenders are actually earning money). With such high returns now possible, generous bonuses and funding that should last for a couple of years; I just can't resist lending. So I'll continue to be a Prosper backer. I do however appreciate the knowledge, insight and opposing viewpoints that I find here.