Lendbuzz, an AI-based auto finance platform, today announced a $360 million investment, including $60 million in Series C equity financing led by Wellington Management joined by Goldman Sachs & Co and MUFG Innovation Partners, and $300 million in debt financing led by Goldman Sachs Bank USA. The new growth capital will support the company’s fast expansion, and allow Lendbuzz to further its mission of helping individuals currently underserved by the traditional credit system. The company, which partners with auto dealerships, offers an end-to-end loan origination and servicing platform that fits into dealers’ existing F&I workflows and enables a seamless, digital experience for buyers.
Lendbuzz is modernizing the outdated auto finance industry, with a focus on serving consumers that have thin or no credit history in the United States. There are over 45 million people in the U.S. that live outside the traditional credit system – and another 30% of U.S. consumers are considered near-prime clients – precluding a large segment of the population from the credit terms they deserve, often forcing them to accept very high interest rate loans.
“Lendbuzz was founded to expand access to credit for millions of consumers who are currently underserved by the traditional credit system,” said Amitay Kalmar, co-founder and CEO of Lendbuzz. “This additional financing allows us to further accelerate our growth and continue improving the car purchase experience for our clients.”
Lendbuzz’s underwriting model – powered by machine learning and proprietary algorithms – allows it to better assess the risk of creditworthy consumers who are underserved by traditional banks. Compared to legacy underwriting systems that are based on FICO scoring and often utilize just a handful of data points, Lendbuzz analyzes thousands of data points — from transaction and spending patterns to education and employment history — to better and more fairly evaluate applicants. Auto dealerships, in turn, are able to close additional business opportunities that otherwise would have been lost, and offer a frictionless and 100% paperless customer experience that enables real-time approval and faster funding.