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AI-powered lender Upstart raises $50m

AI-powered lender Upstart raises $50m

Upstart, a US AI-powered online lender founded by a gaggle of former Googlers, has raised $50 million in a Series D funding round and inked partnerships with several banks.

Progressive Investment Company, Healthcare of Ontario Pension Plan and First National Bank of Omaha joined the round, which brings Upstart's total funding to $160 million.

Upstart is one a host of alternative lenders to enter the US market in recent years, claiming to look beyond credit scores, using modern data science and technology to offer borrowers lower rates on loans.

The firm has originated more than $3.3 billion in loans over the last five years, claiming loss rates less than half of those of its peers for borrowers with similar Fico scores.

In 2017, Upstart decided to broaden its business model, offering banks of the option of tapping into its AI platform in the form of a white label lending application. It has now signed First National Bank of Omaha, First Federal Bank of Kansas City and Accion Chicago to the service.

The company is also moving into other types of credit, partnering with Customer Bank's BankMobile unit on a credit card.

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