On Deck and Intuit run joint fund to back loans
A partnership between financial technology company On Deck Capital and financial services software firm Intuit that generates business loans is supported by a fund also supported by both companies.
On Deck Capital and Intuit jointly own a limited liability corporation called Lancelot QBFOD, according to On Deck's quarterly filings. Lancelot is not mentioned in Intuit's most recent quarterly filing with regulators.
The fund is another example of how fintech startups are diversifying the sources that invest in their loans.
Lancelot is based in Delaware, according to documents filed with regulators. On Deck filings state that the company "acquired" a 67 percent interest in Lancelot in the third quarter of 2015. On Deck's filings state that 33 percent of Lancelot QBFOD LLC is owned by Intuit. That matches the time frame of On Deck and Intuit's partnership announcement, which came in mid-September last year.
"We consider it to be a successful partnership," a representative for On Deck Capital said, declining to provide specifics on the venture.
On Deck and Intuit announced last year a partnership to launch a $100 million small business lending fund. At the time it was not publicized where the $100 million was coming from; On Deck's reports do not specify the size of the Lancelot LLC and a representative for On Deck declined to say how large the Lancelot fund is.
"Intuit has successfully launched a partnership with OnDeck to provide small businesses with faster access to loans. Intuit looks forward to continuing to leverage partnerships to fuel small business success with the QuickBooks Financing platform," an Intuit spokesman said.
The spokesman said details about Lancelot are not available in its earnings reports because it is "not material to our financials."
"We and Intuit jointly invested in Lancelot QBFOD LLC to provide integrated access to line of credit financing to Intuit customers and utilizing Intuit's customer data," On Deck's quarterly reports state.
Correction: The company's lending arrangement through the Lancelot fund is an on-balance sheet investment fund. An earlier version of this story said On Deck's fund was an outside fund. On Deck announced the arrangement in September 2015.