Green Sky Credit is Now the Highest Valued Privately Held Online Lender

In Jan. 2018 GreenSky Credit announced it had secured $200 million in additional capital from Pacific Investment Management. With the new equity in place, David Zalik and his company are worth an estimated $4.5 billion. In May, the company privately filed for an IPO, which could put the company’s valuation at nearly $5 billion.

With that investment, it put GreenSky Credit over the top in terms of valuation of online lenders. SoFi, the well-known and highly regarded non-traditional bank lender, was the valuation leader for some time. The company also vaulted into the second spot in terms of privately held fintech companies, just behind Stripe.

David Zalik, a college dropout who did not attend high school, founded GreenSky Credit in 2006. The company provides a platform that arranges home improvement loans and other lines of credit between consumers and businesses for up to $55,000. Banks such as Fifth Third Bancorp, SunTrust and Regions provide the funding for the loans. The technology behind the company works as a go-between for customers with good credit and banks offering terms that are more attractive than what is normally offered.

Investors, hedge funds and big banks are starting to put more money into retail purchase finance companies such as GreenSky Credit. Zalik and his company plan to use the new infusion of capital to investigate whether it is prudent to move into other areas of point-of-sale loans.

GreenSky’s merchants include big-box retailer Home Depot, healthcare brands and healthcare providers. From 2015-2017, the company’s total transactions increased from $306,000 to $409,000 per merchant. GreenSky Credit also saw its total number of customer accounts dramatically increase from 700,000 in 2015 to nearly 1.6 million at the end of 2017.

Other investors in GreenSky Capital include QED Partners, DST Global, TPG Private Equity Capital and Iconiq Capital.

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