CommonBond Raises $3.5M From Investors With $2.5M Loan Pool and $1M Equity Round, Company Announces Official Beta-Launch at Wharton and Sets Sights on National Expansion in 2013
NEW YORK, Nov. 28, 2012 /PRNewswire/ -- CommonBond, a student loan crowdfunding platform with a unique vision and plan to fix the broken student loan system, announced today its official launch at the University of Pennsylvania's Wharton School of Business. The company has raised a total of $3.5M from alumni and investors: $2.5M from prominent alumni investors to disburse to students in the form of loans, and an additional $1M in seed funding from a super angel investor to capitalize the business.
David Klein, CEO of CommonBond, was selected unanimously by the Wharton Leadership Committee to keynote the "Perspectives on Leadership" Lecture Series today at Wharton, where he will announce the launch of CommonBond to an audience of over 100 students and administrators:
"The student loan system is complex, slow-moving, and expensive. It doesn't have to be, so we're fixing it," Klein says. "With the launch of CommonBond, we're bringing the power of community to finance to reduce the burden of student debt and make finance better. It's a win-win for student borrowers and alumni investors: students save, while investors earn."
CommonBond connects student borrowers and alumni investors to provide loans at a lower fixed rate. Through the CommonBond model, students pay a 6.24% fixed interest rate and can save $20K over the course of loan repayment relative to traditional alternatives, while alumni investors can expect to earn an annual return of over 4%. The website – www.CommonBond.co – is now live and accepting applications. CommonBond will fund over 50 Wharton MBA students in December, just in time for second semester, before expanding nationally in 2013.
Recently of note, the company was invited by Rohit Chopra, Student Loan Ombudsman of the Consumer Finance Protection Board (CFPB), to join a select group of consumer finance executives, entrepreneurs, technologists, and government officials at the CFPB's "Project Catalyst" Summit in Silicon Valley on November 14. The summit convened the country's top innovators in the consumer finance industry with the shared purpose of identifying solutions to burdensome financial issues such as student debt.
CommonBond is a student loan crowdfunding platform that provides more affordable financing to graduate students in order to relieve their financial anxiety and better position their professional success. Founded by three Wharton Business School students in 2011 - David Klein (CEO), Michael Taormina (CFO), and Jessup Shean (Advisor) - the company is launching its inaugural loan program at Wharton in November 2012. The founding team brings a breadth of experience across consumer finance, asset management, and law. They firmly believe that business can and should be a force for positive change, having been inspired by the "one-for-one" model of companies like Warby Parker and TOMS Shoes. CommonBond is the first-ever company to bring the "one-for-one" model to education and has partnered with the African School for Excellence to fulfill its global Social Promise.ABOUT THE FOUNDERS
David Klein is co-founder and CEO of CommonBond. Previously, he worked in consumer finance at American Express as Director of Strategic Planning and Business Development and McKinsey & Company, where he advised clients in the financial services industry. David graduated from Brandeis University with a B.A. in Politics, Economics, and International Business. He is an alumnus of Wharton and sits on the Board of the Bronx Charter School for the Arts.
Michael Taormina, CFA, is co-founder and CFO of CommonBond. Previously, he worked in asset management as Vice President at J.P. Morgan, where he covered high-net-worth clients and specialized in interest rate and FX trading. He also worked directly under the CIO of J.P. Morgan Private Bank. Mike graduated summa cum laude from Georgetown University with a BS/BA in Finance and International Business. He is an alumnus of Wharton.
Jessup Shean is co-founder and Advisor of CommonBond. She currently works at Greenhill & Co., a global investment bank. Previously, Jessup worked at the law firm of Fried, Frank, Harris, Shriver & Jacobson, where she focused on debt private placement and at J.P. Morgan's Equity Capital Markets group based in Hong Kong. Jessup graduated from Brown University with a liberal arts degree and received a J.D. and MBA from the University of Pennsylvania.