China-based online lending marketplace WeLab raised $220m in debt and equity financing last week in a series B+ round that featured e-commerce firm Alibaba’s Hong Kong Entrepreneurs Fund, financial services firms Credit Suisse and China Construction Bank (CCB) and International Finance Corporation, the private investment arm of the World Bank.
WeLab has developed an app-based peer-to-peer lending platform with over 25 million users. It normally issues small loans to consumers, and has reportedly experienced six or sevenfold year-on-year growth in the first half of 2017.
The company has so far raised an estimated $425m since its inception in 2013. Malaysian sovereign wealth fund Khazanah Nasional led its $160m series B round in January 2016, investing together with Netherlands-based financial services firm ING Bank and Chinese state-owned investment firm Guangdong Technology Financial Group. It had previously received $20m in series A funding in early 2015 from investors including media company Tom Group.
WeLab is only one company in the rising sub-sector of alternative lenders within the fintech realm. As the GCV Analytics chart below shows, the number of corporate-backed rounds in such emerging enterprises has been on a steep rise since 2013 – deals have grown manifold from 13 in 2013 to 43 in 2017 by the time of writing. The total estimated size of these rounds has also grown sevenfold from an estimated $410m for 2013 to $3.02bn by the end of 2016. It remains to be seen to what extent these new lenders will continue to disrupt traditional retail banking.
