WeLab, the startup that runs WeLend, Hong Kong’s first peer-to-peer lending site, has raised a $14 million Series A from TOM Group and Sequoia Capital. The company says it plans to launch a new product in mainland China later this year that will use big data for credit risk modeling, as well as establish strategic partnerships with mobile, e-commerce, and financial companies. WeLab overcame obstacles with a money lenders license in Hong Kong, as well as stringent standards–for example, at the time we talked to them, WeLab only approved 20% of loan applicants in order to optimize its portfolio. In return, borrowers got lower interest rates than from banks and other traditional financial institutions. WeLab’s goals include building other online products to “democratize finance.”
WeLab Holdings, an Internet finance start-up in Hong Kong, said on Monday that it had raised $14 million from Li Ka-shing, Asia’s richest man, and Sequoia Capital, a stalwart of Silicon Valley. In a deal that highlights the strong demand among investors for the Chinese Internet sector, WeLab said it would use the cash to finance a push into mainland China, where it plans to bring “big data” to finance, employing vast amounts of information to help companies better evaluate and price their credit risk. WeLab did not disclose any stake amounts or valuations of the company based on the latest fund-raising. The financing round is a so-called Series A investment, the first attempt to raise money after WeLab’s initial solicitation of seed capital when it started up a year ago. It secures backing from Mr. Li’s TOM Group, which invests in the media and Internet businesses and has a joint venture e-commerce business with mainland China’s postal service operator. Sequoia Capital is one of the most active venture capital firms in China, having invested in more than 100 Chinese companies, including JD.com, the online retailer that last month raised $1.78 billion in an initial public offering in the United States.
