P2P lender, Prosper Marketplace, acquires credit monitoring app
Peer-to-peer lender Prosper Marketplace is buying BillGuard, a personal finance app provider, according to an announcement yesterday. The terms of the deal were not disclosed, although VentureBeat said that it had learned that the transaction amounts to around $30m in cash, plus an undisclosed stock component. Prosper’s C﻿hief E﻿xecutive, Aaron Vermut, said that the deal would be “a transformative acquisition for Prosper Marketplace and for the marketplace lending industry” because BillGuard “offers a consumer-focused app that lets anyone in the US monitor their bank card transactions and receive alerts for hidden fees, billing errors, and scams.”

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BillGuard, the crowdsourced security app for personal finance, has been acquired by peer-to-peer lending giant Prosper Marketplace.

While the full value of the deal has not been revealed, VentureBeat has learned that the transaction amounts to around $30 million in cash, plus an undisclosed stock component.

Prosper Marketplace was one of the pioneers in the peer-to-peer lending model, and is better known for Prosper.com, which has handled more than $4 billion in loans since 2006. The company has raised north of $350 million to date, including a $165 million round back in April that valued the San Francisco-based company at almost $2 billion.

BillGuard has also built a solid reputation in the personal finance realm since it was founded out of Israel in 2010. The startup, which has offices in Tel Aviv and New York, offers a consumer-focused app that lets anyone in the U.S. monitor their bank card transactions and receive alerts for hidden fees, billing errors, and scams.

Much of BillGuard’s data comes from its community of 1.3 million registered users, who flag any “bad” charges they receive. BillGuard claims more than $70 million in unauthorized charges have been flagged over the years and, back in June, added identify theft protection to its core offering.

Prosper said that the acquisition will enable it to offer its current customers more tools “to make smarter financial decisions.” Moreover, BillGuard boasts a strong engineering and product team in Tel Aviv, where the company’s two founders — Yaron Samid and Raphael Ouzan — hail from. And Prosper pointed to this as a major boon.

“Israel is home to phenomenal tech talent on par with the best of Silicon Valley, and we see great opportunity to bolster our ranks by broadening BillGuard’s proven team and product,” said Itzik Cohen, chief business officer at Prosper.

What began as a few phone calls about a potential deal culminated in Cohen traveling out to Tel Aviv to spend a few days with the BillGuard team. And Ouzan told VentureBeat the synergies quickly became apparent.

“We had a blast — you know those times where the product really makes sense and the integration is clear — it took us a minute to figure out a joint roadmap,” said Ouzan. “They were blown away by the talent of the team. They want to become this product company, and they want BillGuard to be at the forefront in terms of providing financial wellbeing to consumers.”

In effect, BillGuard will continue to work on and iterate its existing service, while feeding into Prosper Marketplace, as it evolves beyond simple peer-to-peer lending into a more extensive financial management company. BillGuard employees in Tel Aviv and New York will join Prosper, with the New York office moving to San Francisco. Ouzan also said it plans to “double down” on its Israel hub, and will triple its headcount from 25 to 75 in the next year.

“This will be a transformative acquisition for Prosper Marketplace and for the marketplace lending industry,” added Aaron Vermut, Prosper’s CEO. “Until now, nobody has brought together marketplace lending and personal finance management to deliver an offering that truly empowers, protects and educates consumers.”

While BillGuard has launched in other markets around the world in the past, it has since pulled the product from other countries to focus exclusively on the U.S. However, under the wing of Prosper Marketplace, Ouzan said it will broaden its global horizons again in the future.

This is Prosper’s second acquisition, having snapped up patient-financing platform American HealthCare Lending for $21 million back in January.