Lendbuzz, an Israeli FinTech startup developing an AI-powered platform for car financing, closes $360 million in funding. The investment consists of $300 million in credit, and $60 million which will be allocated to company operations.
Using AI to finance your next car
In the U.S.A there are more than 45 million people who live outside the traditional credit system. This makes a good chunk of the population ineligible for standard loan rates, forcing them to take on high interest loans.
Lendbuzz develops an AI-driven system for financing car loans in the U.S. The company helps consumers with little to no credit lines receive financing for vehicles. By cooperating with dealerships, Lendbuzz has adapted its digital platform to their needs and processes, and provides consumers with financing plans that fit within their expenses.
While chatting with Geektime, CEO and co-founder, Amitay kalmar, says that the company has developed advanced machine learning technologies, which enable accurate low data-point risk assessment based on a consumer’s FICO score. “We’re operating in a complex sphere of distributed data. The system requires training to pinpoint what’s important versus what’s not, and how to handle the overflowing data coming in from numerous sources. Additionally, non-credible data detection becomes immensely crucial, and we’re developing different systems to more accurately monitor and identify fake data,” says Kalmar.
Lendbuzz was founded in 2015 by Kalmar and CTO Dan Raviv. The two founded the company in Boston and recently established its first R&D center in Israel -- employing a team of 5. While most Israeli startups are looking to expand to the U.S.; we asked Kalmar, why now was the time to open R&D in Israel. The company said that “it strongly believes in the Israeli engineer.”
The round was led by Wellington Management, with participation from Goldman Sachs and Mitsubishi’s investment arm -- Mitsubishi UFJ. The investment also saw existing investors get in on the action, including 83North, Eyal Ofer’s O.G. Tech, Arkin Holdings, Mivtach Shamir and Highsage Ventures. The debt funding was led by Viola Credit and Goldman. To date, the company has raised $45 million in equity and $350 million in debt -- with the new funding bringing the total to $105 million in equity and $650 million debt.