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[j9359]

Looks like we have reached a plateau and either Prosper is going to find a way to move things to a higher level or it will die.
IMHO, the flaky moderation and then the final killing off of the old forums was a huge mistake.
And collections is a big problem area.  Prosper should have had a better plan to begin with.  Perhaps the "new agency test" will improve things but we will have to wait and see.  I'm going to take a break from lending for the next month or two to see how the bets I've placed recently work out.
john.

[cowdog]

Kiva works because of community, and Prosper might have been working at one time, at least on some level, when they had groups, forums and open discussion.

The whole idea of Prosper was community, but then they killed the community by killing groups, forums, and any opposing point of view.

So the question is: Are CL and JW the biggest idiots to ever walk the face of the planet, or was this planned to take VC for a ride?

 

[Mtnchick]

So the question is: Are CL and JW the biggest idiots to ever walk the face of the planet, or was this planned to take VC for a ride?

 

Can't I choose both?

[ducks]

Ducks,did you even view the links.? The last 8 months are flat

Yes, I viewed the chart, and noticed that every month in 2007 was much better than the same month in 2006, even December. Few lenders can claim that!

Are you kidding?  Originations have been declining since April, and flat since July.  It is quite possible that Jan. '08 will be less than Jan. '07, but even if it (barely) avoids that fate, March '08 will surely be less than March '07, given that March '07 was over $8.2M (compared to around $6.3M a month since July).  The year over year decline in April '08 will be even worse.

If January 2008 is not significantly better than January 2007, then I think we will have something to talk about. I'd rather watch for one more month than try to make predictions.

[Urbi_et_Orbi]

Registered lenders:

January 2007: 26,600         
December 2007: 65,340  (145% increase)

Funding: Basically flat

[j9359]

Fewer big lenders?
Or borrowers now register as lenders first to get verified?
john.

[traveler505]

Ducks,did you even view the links.? The last 8 months are flat

Yes, I viewed the chart, and noticed that every month in 2007 was much better than the same month in 2006, even December. Few lenders can claim that!

Are you kidding?  Originations have been declining since April, and flat since July.  It is quite possible that Jan. '08 will be less than Jan. '07, but even if it (barely) avoids that fate, March '08 will surely be less than March '07, given that March '07 was over $8.2M (compared to around $6.3M a month since July).  The year over year decline in April '08 will be even worse.

If January 2008 is not significantly better than January 2007, then I think we will have something to talk about. I'd rather watch for one more month than try to make predictions.

If we were talking about a mature, established, profitable business, then, yes, having each month be a bit better (after adjusting for inflation) than the same month of the previous year is adequate performance. 

But we are talking about a business that did not exist (except in a friends and family beta test phase) two years ago, and which (according to the CEO) needs 4 or 5 times the volume to be profitable, the lack of growth from month to month within a year is catastrophic.

[ducks]

All I'm saying is that we'll know more after we see January's statistics. I'm sure that the last few months have been less than Prosper's executives and investors expected. However, Prosper received another $20M funding in June, so I expect they haven't quit yet.

[HollowOak]

My take on this is that Prosper itself has put a big spoke in the wheel of lending growth by providing bidding guidance on each bid lenders place. On that basis, I expect to see a dramatic cut-back in dubious loans funding, with a resulting impact on the overall funding levels of loans. However, in a few months this should start feeding through to the bottom line and result in less loans becoming delinquent. Prosper can then base its hopes on a steady or exponential growth on "new" funding growth based on the positive experiences of the "new" lenders.

I postulated as much some time back in a piece I wrote.

[ira01]

All I'm saying is that we'll know more after we see January's statistics. I'm sure that the last few months have been less than Prosper's executives and investors expected. However, Prosper received another $20M funding in June, so I expect they haven't quit yet.

But in June, everything would have seemed just fine.  Sure, May was down from April, but it was still the 3rd best month ever, and could easily have been chalked up to a blip.  Moreover, the June VC financing was probably arranged in May, so the last month's performance at that time (April) would have been the best ever.  Unfortunately for the VC's, their $20M came just as Prosper was kicking off 6 months of flat performance.  Although, frankly, I can't be too sympathetic to the VC's, because if they would have done some due dilligence in the forums at that time, they would (should) have had a lot of probing questions for management.

[Ferrix]

However, in a few months this should start feeding through to the bottom line and result in less loans becoming delinquent. Prosper can then base its hopes on a steady or exponential growth on "new" funding growth based on the positive experiences of the "new" lenders.

Once they get back on track maybe they'll stop persecuting the unofficial sites.  Hey, it's possible!

[traveler505]

My take on this is that Prosper itself has put a big spoke in the wheel of lending growth by providing bidding guidance on each bid lenders place. On that basis, I expect to see a dramatic cut-back in dubious loans funding, with a resulting impact on the overall funding levels of loans. However, in a few months this should start feeding through to the bottom line and result in less loans becoming delinquent. Prosper can then base its hopes on a steady or exponential growth on "new" funding growth based on the positive experiences of the "new" lenders.

I postulated as much some time back in a piece I wrote.

That assumes an ample supply of quality borrowers (with quality being defined by Prosper's bidding guidance).  I think that will be the bottleneck.

ETA: (By HollowOak). My sincere apologies. I accidentally modified Traveler505's post instead of quoting it. I have now removed my comment and will add it in a quote.  (Damned moderating powers ran amok.)

[HollowOak]

My take on this is that Prosper itself has put a big spoke in the wheel of lending growth by providing bidding guidance on each bid lenders place. On that basis, I expect to see a dramatic cut-back in dubious loans funding, with a resulting impact on the overall funding levels of loans. However, in a few months this should start feeding through to the bottom line and result in less loans becoming delinquent. Prosper can then base its hopes on a steady or exponential growth on "new" funding growth based on the positive experiences of the "new" lenders.

I postulated as much some time back in a piece I wrote.

That assumes an ample supply of quality borrowers (with quality being defined by Prosper's bidding guidance).  I think that will be the bottleneck.

That, I agree with you, might be a problem, but it is a different problem and one might think that they could spin that in a very positive light if the need should arise.

[ducks]

That assumes an ample supply of quality borrowers (with quality being defined by Prosper's bidding guidance).  I think that will be the bottleneck.

That's a very good point. The problem for Prosper is that quality borrowers will probably want lower rates than lenders want to receive, especially considering that any smart lender will be including a decent margin for risk. The quality borrowers don't think they could ever default, so they don't understate that rate cushion. Also, few quality borrowers have experience with unsecured loans, so their rate expectations are based on secured loans.

Furthermore, banks and other lenders are competing even more strongly for the prime market in a flight to quality.

[nonattender]

My take on this is that Prosper itself has put a big spoke in the wheel of lending growth by providing bidding guidance on each bid lenders place. On that basis, I expect to see a dramatic cut-back in dubious loans funding, with a resulting impact on the overall funding levels of loans. However, in a few months this should start feeding through to the bottom line and result in less loans becoming delinquent. Prosper can then base its hopes on a steady or exponential growth on "new" funding growth based on the positive experiences of the "new" lenders.

You know that chugga-chugga sound as a cold engine tries to start up?
(The one that precedes either a gentle hum & purr -- or more chuggas?)

chugga-chugga^2,
-t