August 7, 2015
Established startups acquire talented upcoming startups to broaden their product offering. One such example is Affirm acquiring LendLayer to enter the accelerated learning space. LendLayer is a startup that offers lending for accelerated learning programs for a number of accelerated learning schools in the US such as Coder Camps, New York Code & Design Academy and Hackbright Academy. Students enroll in coding boot camps that are normally for about 12-18 weeks which cost nearly $10k-20k and use LendLayer to pay for this course fee. Loans can be repaid in easy installments starting from as low as $50 a month.
On the other hand, Affirm offers loans for mainly retail products that an Affirm partner merchant sells. The Affirm account holder can choose to pay with Affirm at checkout and instant approval is given. Affirm offers rates from 10-30% APR based on credit checks with repayment plans of three months, six months and 12 months.
LendLayer has grown in leaps and bounds in the past eight months, becoming the top lender in the accelerated learning space. They have partnered with various digital marketing schools, data science, design schools and regular coding boot camps. Affirm wants to get into this accelerated learning space, and this acquisition will help them get into that space. Affirm has been trying to enter this space with full force as can be seen from the partnership with the General Assembly program which helped them raise $275 million in May this year.
According to TechCrunch, the LendLayer acquisition happened when one of Affirm’s investors came across their pitch and got hooked to the idea. He managed to get Co-founder of Affirm Max Levchin onboard. Affirm already has partnerships with institutions such as Kaplan, General Assembly, Hank Reactors and a few more. LendLayer is an important acquisition by Affirm, and with this move, the company has bolstered its position in the FinTech industry.