MINNEAPOLIS, May 15, 2023
/PRNewswire/ -- Castlelake, L.P. ("Castlelake"), a global
alternative investment manager with 17 years of experience
investing in asset-rich opportunities today announced that
Castlelake, together with a co-investor and minority partner Eltura
Capital Management, has reached an agreement to purchase up to
$4 billion of consumer installment
loans from Upstart (NASDAQ: UPST), an artificial
intelligence (AI) lending marketplace. The purchase
agreement consists of the acquisition of a back book of loans and a
forward flow arrangement.
Upstart connects millions of consumers to 99 banks and
credit unions who leverage Upstart's AI to approve more
borrowers at lower loss rates, while simultaneously delivering
the exceptional digital-first experience customers demand. More
than $32 billion in loans have been originated on
Upstart's platform since its inception in 2012. Through the
transaction, Castlelake will leverage its experience underwriting
consumer credit and small business loans to provide Upstart with
the ability to upsize its business.
"Through this purchase agreement, Castlelake is pleased to
partner with Upstart to expand its business in response to the
increasing demand for affordable credit in today's economic
environment," said John Lundquist,
Partner, Specialty Finance at Castlelake. "Against a backdrop of
increasing economic uncertainty, Castlelake is committed to helping
support Upstart's mission of unlocking mobility and opportunity for
millions of U.S. consumers."
"Upstart is excited to collaborate with a firm that we believe
is an experienced and dependable capital provider through economic
cycles," added Sanjay Datta, CFO
of Upstart. "Castlelake's support will help ensure we have the
resources to continue scaling the deployment of our AI
models and expanding access to affordable credit for all
consumers."
The transaction is a recent example of Castlelake's
participation in the consumer credit and specialty
finance sector, where it has both acquired assets and provided
asset-based private credit. Other recent transactions include a
£100 million facility commitment for a fintech company focused
on expanding its revenue-based financing solution, and an
agreement to provide credit to a tech-enabled trade financing
platform built for small and medium-sized businesses.
"Whether through asset acquisition or bespoke private credit
solutions, Castlelake has both the experience and flexibility to
support companies operating in the specialty finance and
consumer credit arena," said Isaiah
Toback, Partner, Deputy Co-chief Investment Officer at
Castlelake. "With sustained consumer demand for affordable credit
and the ongoing retrenchment of traditional lenders, we believe
that private capital represents an increasingly important part of
the financing market for companies seeking steady, secure
growth."
About Castlelake
Castlelake, L.P. is a global alternative investment manager
focused on investments in real assets, specialty finance and
aviation across the risk spectrum, from value-oriented to income
and investment grade credit. Founded in 2005, Castlelake manages
approximately $20 billion of assets. The Castlelake team comprises
more than 200 experienced professionals, including 89 investment
professionals, across seven offices in North
America, Europe and Asia. For more information, please
visit https://www.castlelake.com/.
Contact
Castlelake
Prosek Partners for Castlelake
Josh Clarkson/Remy Marin
+1 212 279 3115
jclarkson@prosek.com / rmarin@prosek.com
Castlelake Media Relations
media.relations@castlelake.com
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SOURCE Castlelake