Gregg Schoenberg: Peer to Peer Investing – A New Model in the Financial Marketplace TPS65

GreggSchoenbergGregg Schoenberg is the Executive Chairman of Peerform, an emerging market lending platform based in New York. He is also the founder of Wescott Capital, which holds interests in selected early-stage technology companies.

  • Greg shares his background in politics and how he switched to Wall Street. “I was tired of being poor.”
  • Greg’s view of Wall Street has positive aspects, especially the activities he is involved with now.
  • Since the financial crisis people are making a lot of money, except it isn’t filtering down to the average person, especially for those who need interest income, such as retired people.
  • Marketplace lending, which is what peer to peer investing is, is providing an avenue for people to get better interest rates on their investments.
  • Efficient, transparent way for individuals to generate a higher rate of return than traditional sources.
  • Greg explains who peer to peer investing (and borrowing) works.
  • A lot of peer to peer rules are set up on the state level, which is why in some states, like New Mexico, residents can’t be investors.
  • com only accepts accredited investors, which allows for people in all states to participate.
  • People come to P2P for a number of reasons including consolidation of credit card debt, to fund a small business, to make home improvements,, pay for medical billis, etc.
  • com doesn’t just look at credit scores, they evaluate a person’s entire situation.
  • Although the number varies, less than 50% of loan applications are actually funded.
  • The default rate is in the low single digits.
  • The big banks are in a bind. The polititians are telling them they need to lend more. At the same time, regulators are telling them not to lend and to get their houses in order.
  • Once the cost of money is normalized, there will be more changes implemented on Wall Street.
  • Dirivitis can be used as weapons of mass destruction. Part of the problem was that people didn’t understand the financial instruments they were selling.
  • P2P lending is creating new financial opportunities.
  • Greg believes that a lot of young people have an interest in reinventing the financial services industry and creating better ways of doing things.