Vancouver tech entrepreneur Markus Frind has wasted little time pouring some of his recent windfall back into the local startup scene.
Mr. Frind, who sold his online dating site Plentyoffish.com last month to Match Group, part of Barry Diller's IAC/InterActiveCorp., for $575-million (U.S.), is the lead investor in a $9-million (Canadian) financing for Vancouver online lending business Grouplend that closed this past week. The firm, which launched its platform in October, has raised $10.2-million in total. Mr. Frind, who was the sole owner of Plentyoffish.com, has also recently invested $18-million in another early-stage Vancouver e-commerce company, online furniture retailer Cymax Stores Inc.
"I certainly have been writing large cheques" and investing in local startups, Mr. Frind told The Globe last month. "If there are other interesting companies that come up and there are interesting cases where they make money and they are not charity cases, then we'll of course invest."
Mr. Frind said in an e-mail Tuesday that he is focusing his investing in startups at later stages in their development "where I can make a huge impact with the knowledge I have growing a massive business." However, since he initially invested in Grouplend at its earliest stage and "it's doing really well … I'm investing more."
Mr. Frind is joined by fellow investor Lance Tracey, founder of Peer 1 Hosting and Sutton Real Estate Group.
Grouplend finances lenders with funds provided by investors including high-net worth individuals who are willing to lend through its "peer-to-peer" platform. The company says it has received applications for hundreds of millions of dollars in loans and serviced thousands of borrowers.
Founder and chief executive Kevin Sandhu, 32, started Grouplend in early 2014 after a decade working in investment banking and private equity on Bay Street. His chief technology officer is a Simon Fraser University-trained software engineer named Dan Cowx who has worked for Sony and Kodak and completed the Ironman Canada competition in 12 hours and 22 minutes.
The online lending business has drawn out a number of upstarts, including Mogo Finance Technology Inc., another Vancouver company that went public recently, one of many companies looking to cash in on the "fintech craze" that some promise will bring low-cost, efficient tech-driven online financial services to the fore and upend traditional financial institutions.
But global market volatility has weighed on the space, with Mogo and other online lenders that have gone public, including LendingClub Corp. and On Deck Capital Inc., seeing their shares sell off.
Mr. Sandhu isn't concerned by the competition, which he says will only generate more interest in the budding fintech space. He says his company's advantage is a home-grown technology platform that allows it to do faster and better data analytics on loan applicants, allowing the company to approve most loans within 24 hours, rather than three to six days like other lenders, and to charge lower rates. "We believe we have a fundamentally superior product."
Mr. Sandhu said the financing will enable Grouplend, which has all of nine employees and leaves much of the loan-application assessments to its algorithms, to expand the range of lending products it can offer applicants, which primarily apply now for three-year unsecured loans. "This is a very effective way to offer credit to consumers," he said.