Curql Invests in 10th Enterprise, Gains Minority Stake in LoanStreet

The Curql Fund I CUSO has invested in its 10th enterprise: LoanStreet Inc., an online platform for sharing, managing and analyzing loans.

Nick Evens, president/CEO of Curql Collective, a CUSO that acts as the general partner for the fund, would not say how much was invested in LoanStreet, but he said the fund has now invested $40 million to gain minority stakes in the 10 entities.

In an interview with CU Times Wednesday, Evens said LoanStreet fits the criteria for “transformative technologies” sought by the Curql Collective’s board. He said the platform is already being used to handle loan participations by more than 1,000 credit unions, and its advantages include ease of use, robust analytics and transparency that allows both buyers and sellers to view the information needed to approve deals.

On Tuesday, New York, N.Y.-based LoanStreet announced it had closed a $25 million Series B funding led by Portage Ventures to accelerate the growth of its loan ecosystem.

In addition to Curql Fund I, LoanStreet said Coastal Financial Corp. and Sterling Bancorp had joined as new investors. The round also had participation from existing investors Third Prime Capital and Arbor Ventures.

With the $25 million round, LoanStreet has now drawn a total institutional investment of $39 million.

LoanStreet said it will use the investment to accelerate the adoption of its market-leading participations platform for trading and reporting on loans; expand the capabilities of its loan analytics offerings; and continue to develop its next-generation commercial loan servicing solution.

Adam Felesky, a co-founder and CEO of Portage Ventures of Toronto, said LoanStreet is “uniquely positioned as a critical lending infrastructure provider with scalable solutions that can benefit all lenders, from the smallest to the largest and most sophisticated.”

“We see tremendous potential for LoanStreet’s technology to become a ubiquitous daily-used tool within U.S. credit unions, banks and direct lenders as well as significant possibilities for growth into the Canadian market and beyond,” Felesky said.

LoanStreet’s CEO is Ian Lampl, the former deputy chief counsel for the U.S. Treasury Department’s TARP during the financial crisis. He founded LoanStreet in 2013 to meet the acute need he saw for a standardized and automated loan sharing platform.

Lampl said the new investment will enable LoanStreet to continue to build digital lending and balance sheet management solutions for a growing number of clients.

“From the beginning, we have focused on making it easier for financial institutions to manage their loan portfolios. We are proud of the rails that we’ve built that make the loan ecosystem more transparent and liquid,” Lampl said.

Curql is pronounced like “circle” and based in Cedar Falls, Iowa. The Curql Collective and the Curql Fund I venture capital fund were formed in 2020 and are managed by credit unions. Management and due diligence for the fund is performed by Next Level Ventures, a venture capital firm based in Des Moines, Iowa.

The Curql Fund I was closed to investors Oct. 31 after raising $252 million — blowing past its initial target of $150 million.

The fund is designed to invest in technologies that enhance how credit unions engage with their members and how members engage with their money. It had planned to invest 80% of its fund within five years. But Evens said it is now on track to invest that approximately $200 million within four years, or about $50 million per year. With $40 million invested so far among 10 enterprises, he said he now expects it will invest in another eight before year’s end.