Jaw-dropping from today’s Lending Club filing: pic.twitter.com/YHaPTj22c0
— Tracy Alloway (@tracyalloway) June 28, 2016
Saw this roll across my Twitter feed. Lending Club ($LC) must be in trouble. Their demise won’t be good for tech stocks. It sort of reflects badly on startups after the debacles of Theranos and Zenefits.
Lending Club is cooking it’s books.
It’s funny. Recently I was interviewed by Dan Miklosz. Prior to interviewing me, he interviewed another trader turned investor Alan Mathew. We had similar experiences when we left the floor for the startup world. There is a lot of bullshit, and a lot of bullshitters.
One weakness of mine is I am too transparent. Too honest. Too open. It can rub people the wrong way and can ruin a sales pitch.
I detest the “fake it till you make it meme”. People take it to an extreme. I do like scrappiness. There is a difference. Don’t be “all hat and no cattle.”
Scrappiness is launching your business and getting orders. To customers, it looks like the back end is automated but the reality is you are cutting and pasting all kinds of solutions to manage order processing until you have the money to build out a stable solution.
Faking it is what Lending Club did-phantom loans to family members. Faking it is what Enron did. Faking it is what an investor did to a company I know-bouncing a big check and putting them at risk.
I remember someone saying, “Those Enron guys made a lot of money”. Of course, they all went to jail and people’s lives were ruined. If it’s just about the money, don’t do a startup. If it’s just about the money, don’t invest in a startup.