Upstart, a San Carlos, California-based online Artificial intelligence (AI) optimized lending platform, as per recent reports, has announced the completion of a $50 million equity investment round and agreed upon partnerships with three new banks – First National Bank of Omaha, First Federal Bank of Kansas City, and Accion Chicago.
Upstart, till date, has raised $160 million in equity funding with funds from Progressive Investment Company, Healthcare of Ontario Pension Plan, and First National Bank of Omaha. Moreover, Upstart will be joining Progressive in its portfolio of “Advantage Products”.
Upstart plans to partner banks to offer its AI platform – patent-pending risk modeling & automation – as a white-labeled solution, enabling banks to enhance their own lending programs. Additionally, the company has also announced new “Powered by Upstart” partnership agreements with First National Bank of Omaha, First Federal Bank of Kansas City, and Accion Chicago.
“Credit is generally overpriced and unfairly distributed because it relies on techniques developed before the advent of modern computing,” states Upstart co-founder, Paul Gu. “But technology and data science, in the form of AI, have the opportunity to change all of that.”
The company, in the last five years, has originated more than $3.3 billion of loans. Furthermore, Upstart’s revenues grew by about 80% last year, in 2018 and reached a profit margin in the H2 2018. The company also claims that 60% of its originations in 2019 have been entirely automated and approved in real time.