Cloud Lending Solutions (CLS), an end-to-end lending platform built natively on Salesforce.com, has raised $8 million Series A funding.
CLS CEO Snehal Fulzele said the funds will be directed toward expanding their United Kingdom operation and “supercharging our core function to eventually help us compete with the Oracles of the world.”
In a release, CLS said the size of the round compares favorably to Orchard’s ($12M), Lending Club’s ($10.3M), and Prosper’s ($7.5M) Series A’s.
Mr. Fulzele said one reason for the size of the round is the disruptive capability of the CLS platform.
“We designed the platform for the hyperconnected, informed and demanding borrower.”
Mr. Fulzele explained today’s borrower expects convenience and simplicity. Coming of age at a time where Amazon and Google are the norm, they are used to a superior experience.
That is an experience inflexible legacy financial systems struggle to provide, he added. The CLS system is borrower focused, which means lenders have to approach the entire process differently
The Series A process validated the CLS vision in several ways, Mr. Fulzele explained.
The first was the participating investors. SF Capital Group, is a single family office based in New York City, is the lead investor. Their President Neil Wolfson has joined the CLS board and Mr. Fulzele looks forward to his contribution.
“Neil will be hands on. He has the ability to think at a high level and with good vision.”
Mr. Fulzele added Mr. Wolfson has a pedigree in the space and brings great connections.
“In this space you will eventually meet Neil at some point.”
All existing investors also participated in the round, a happening Mr. Fulzele said is “great validation for our mission and vision.”
If CLS can attract 70 clients in 20 countries with a comparatively shoestring budget, imagine how they can now scale with a much larger sum in the bank account, Mr. Fulzele suggests.
That potential is part of what attracts venture capitalists, he explained.
“Like any VC looking for a market opportunity, almost all want to be in a space with great potential and marketplace lending fits right there.”
While marketplace lending only has roughly a one percent share of lending in 2015, it could reach $500 billion dollars by the end of the decade.
What excites Mr. Fulzele the most is the effect marketplace lending continues to have on the incumbents. This is the first time they have been pushed to act to reduce friction and produce a better borrower experience, he said.
“Any incumbent movement tends to come from regulatory compliance. This is the first time an external force has pushed them to react.”
“That speaks to the market opportunity.”
The incumbents also see both the opportunity and the need to change. That is why Mr. Fulzele expects to see them contribute to future growth.
“As an infrastructure provider we are agnostic to whom we are serving.”