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GreenSky goes high while Lending Club dredges the sewer

The fintech industry has been rocked by scandal and scandalized by rock-headed missteps. The industry has witnessed the cringeworthy collapse of a number of its previous darlings. Companies like Lending Club and OnDeck, once touted as the next paradigm-shifting tech companies, have buckled under the crushing weight of their own arrogance and folly.

But one company is still standing tall. GreenSky Credit has proven that it has the staying power that its wayward competitors lack. The company has been in business since 2006. And during its 13 years of existence, GreenSky has not changed its business model at all. So powerful is its vision of how lending can be aided through the development of technology that GreenSky has been able to rapidly expand into many new markets, using precisely the same technology and business model that it debuted in the home remodeling sector.

Lending Club should have listened to John Dillinger

The secret behind the success of GreenSky seems almost too obvious to even mention: The company has simply gone where the money is. In this regard, many of the firm’s competitors could have benefitted from the answer that John Dillinger gave when questioned as to why he robbed banks.

Rather than lending to their preferred customer base because that’s where the money is, companies like OnDeck and Lending Club deliberately sought out markets that had long been studiously ignored by mainstream banking, precisely because they are where the money isn’t. While Lending Club and OnDeck sought to change the world and usher in a neo-Marxian utopia of total financial equality, where street people merrily skipped, hand in hand, with Wall Street tycoons, GreenSky was making sensible loans to people who had a good chance of paying them back. While other fintech companies were trying to conjure magical profits using deadbeat relics like NINJA loans and micro-lending, the company was busy creating real value by doing deals where everyone walked away a big winner.

And, today, we see who has emerged victorious and who has been decimated and run over, roughshod. By learning from the past, GreenSky Credit has become the future of fintech.

https://www.forbes.com/sites/greatspeculations/2018/09/05/greensky-now-looks-undervalued-given-strong-q2-performance-alliance-with-amex/#5d78658d5eda