Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Mar. 19, 2024 | Jun. 30, 2023 | |
Entity Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity Registrant Name | PROSPER MARKETPLACE, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 73-1733867 | ||
Entity File Number | 333-257739 | ||
Entity Address, Address Line One | 221 Main Street | ||
Entity Address, Address Line Two | 3rd Floor | ||
Entity Address, City or Town | San Francisco | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 94105 | ||
City Area Code | 415 | ||
Local Phone Number | 593-5426 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Document Financial Statement Error Correction Flag | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 77,164,623 | ||
Entity Public Float | $ 0 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001416265 | ||
Prosper Funding LLC | |||
Entity Information [Line Items] | |||
Current Fiscal Year End Date | --12-31 | ||
Entity Registrant Name | PROSPER FUNDING LLC | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 45-4526070 | ||
Entity File Number | 333-257739-01 | ||
Entity Address, Address Line One | 221 Main Street | ||
Entity Address, Address Line Two | 3rd Floor | ||
Entity Address, City or Town | San Francisco | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 94105 | ||
City Area Code | 415 | ||
Local Phone Number | 593-5426 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Document Financial Statement Error Correction Flag | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 0 | ||
Entity Central Index Key | 0001542574 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Audit Information [Abstract] | |
Auditor Name | DELOITTE & TOUCHE LLP |
Auditor Location | San Francisco, CA |
Auditor Firm ID | 34 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | |
Assets: | |||
Cash and Cash Equivalents | $ 34,970 | $ 83,446 | |
Restricted Cash | [1],[2] | 120,298 | 113,163 |
Accounts Receivable | 7,523 | 3,462 | |
Loans Held for Sale, at Fair Value | [1],[2] | 161,501 | 499,765 |
Borrower Loans, at Fair Value | 545,038 | 320,642 | |
Property and Equipment, Net | 40,889 | 38,814 | |
Prepaid and Other Assets | [1],[2] | 22,273 | 9,208 |
Credit Card Derivative | 36,848 | 10,782 | |
Servicing Assets | 12,249 | 12,562 | |
Goodwill | 36,368 | 36,368 | |
Intangible Assets, Net | 85 | 192 | |
Total Assets | 1,018,042 | 1,128,404 | |
Liabilities, Convertible Preferred Stock and Stockholders' Deficit: | |||
Accounts Payable and Accrued Liabilities | 40,906 | 37,254 | |
Payable to Investors | 86,732 | 85,312 | |
Notes, at Fair Value | 321,966 | 318,704 | |
Notes Issued by Securitization Trust | [1],[2] | 214,798 | 0 |
Warehouse Lines | [1],[2] | 160,207 | 446,762 |
Term Loan | 75,313 | 73,407 | |
Other Liabilities | 35,259 | 28,258 | |
Convertible Preferred Stock Warrant Liability | 215,041 | 166,346 | |
Total Liabilities | 1,150,222 | 1,156,043 | |
Commitments and Contingencies (see Note 17) | |||
Stockholders' Deficit: | |||
Common Stock – $0.01 par value; 625,000,000 shares authorized; 77,861,329 shares issued and 76,925,394 shares outstanding as of December 31, 2023; 75,223,850 shares issued and 74,287,915 shares outstanding as of December 31, 2022. | 293 | 267 | |
Additional Paid-In Capital | 160,709 | 158,814 | |
Less: Treasury Stock | (23,417) | (23,417) | |
Accumulated Deficit | (590,132) | (483,670) | |
Total Stockholders' Deficit | (452,547) | (348,006) | |
Total Liabilities, Convertible Preferred Stock and Stockholders' Deficit | 1,018,042 | 1,128,404 | |
Convertible Preferred Stock | |||
Liabilities, Convertible Preferred Stock and Stockholders' Deficit: | |||
Convertible preferred stock | 322,748 | 322,748 | |
Convertible Preferred Stock Held by Consolidated VIE | |||
Liabilities, Convertible Preferred Stock and Stockholders' Deficit: | |||
Convertible preferred stock | (2,381) | (2,381) | |
Consolidated Entity, Excluding Consolidated VIE | Convertible Preferred Stock | |||
Liabilities, Convertible Preferred Stock and Stockholders' Deficit: | |||
Convertible preferred stock | 322,748 | 322,748 | |
VIE, Primary Beneficiary | |||
Assets: | |||
Restricted Cash | 23,546 | 11,838 | |
Loans Held for Sale, at Fair Value | 161,501 | 499,765 | |
Borrower Loans, at Fair Value | 220,724 | 0 | |
Prepaid and Other Assets | 972 | 3,210 | |
Total Assets | 406,743 | 514,813 | |
Liabilities, Convertible Preferred Stock and Stockholders' Deficit: | |||
Notes Issued by Securitization Trust | 214,798 | 0 | |
Warehouse Lines | 160,207 | 446,762 | |
Other Liabilities | 550 | 0 | |
Total Liabilities | 375,555 | 446,762 | |
VIE, Primary Beneficiary | Convertible Preferred Stock Held by Consolidated VIE | |||
Liabilities, Convertible Preferred Stock and Stockholders' Deficit: | |||
Convertible preferred stock | $ (2,381) | $ (2,381) | |
[1] The following table presents the assets and liabilities of consolidated variable interest entities (“VIEs”), which are included in the Consolidated Balance Sheets above. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. Additionally, the assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. December 31, 2023 2022 Assets of consolidated VIEs, included in total assets above: Restricted Cash $ 23,546 $ 11,838 Loans Held for Sale, at Fair Value 161,501 499,765 Borrower Loans, Held at Fair Value 220,724 — Prepaid and Other Assets 972 3,210 Total assets of consolidated VIEs $ 406,743 $ 514,813 Liabilities of consolidated VIEs, included in total liabilities above: Notes Issued by Securitization Trust $ 214,798 $ — Warehouse Lines $ 160,207 $ 446,762 Other liabilities 550 $ — Total liabilities of consolidated VIEs $ 375,555 $ 446,762 (1) Includes amounts in consolidated variable interest entities presented separately in the table below. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Sep. 20, 2017 |
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Convertible preferred stock, authorized (in shares) | 444,760,848 | 444,760,848 | |
Convertible preferred stock, issued (in shares) | 209,613,570 | 209,613,570 | |
Convertible preferred stock, outstanding (in shares) | 209,613,570 | 209,613,570 | |
Liquidation preference (in shares) | $ 370,456 | $ 370,456 | |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 625,000,000 | 625,000,000 | 625,000,000 |
Common stock, issued (in shares) | 77,861,329 | 75,223,850 | |
Common stock, outstanding (in shares) | 76,925,394 | 74,287,915 | |
VIE, Primary Beneficiary | |||
Convertible preferred stock, issued (in shares) | 51,247,915 | 51,247,915 | |
Convertible preferred stock, outstanding (in shares) | 51,247,915 | 51,247,915 |
Consolidated Balance Sheets - P
Consolidated Balance Sheets - Prosper Funding LLC - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | |
Assets: | |||
Cash and Cash Equivalents | $ 34,970 | $ 83,446 | |
Restricted Cash | [1],[2] | 120,298 | 113,163 |
Borrower Loans, at Fair Value | 545,038 | 320,642 | |
Servicing Assets | 12,249 | 12,562 | |
Total Assets | 1,018,042 | 1,128,404 | |
Liabilities and Member's Equity: | |||
Accounts Payable and Accrued Liabilities | 40,906 | 37,254 | |
Payable to Investors | 86,732 | 85,312 | |
Notes, at Fair Value | 321,966 | 318,704 | |
Other Liabilities | 35,259 | 28,258 | |
Total Liabilities | 1,150,222 | 1,156,043 | |
Member's Equity: | |||
Retained Earnings | (590,132) | (483,670) | |
Total Stockholders' Deficit | (452,547) | (348,006) | |
Total Liabilities, Convertible Preferred Stock and Stockholders' Deficit | 1,018,042 | 1,128,404 | |
Prosper Funding LLC | |||
Assets: | |||
Cash and Cash Equivalents | 3,351 | 6,285 | |
Restricted Cash | 93,688 | 91,564 | |
Borrower Loans, at Fair Value | 324,311 | 320,642 | |
Property and Equipment, Net | 11,641 | 10,004 | |
Servicing Assets | 13,818 | 14,860 | |
Other Assets | 176 | 84 | |
Total Assets | 448,583 | 443,439 | |
Liabilities and Member's Equity: | |||
Accounts Payable and Accrued Liabilities | 8,121 | 4,576 | |
Payable to Investors | 88,371 | 86,927 | |
Notes, at Fair Value | 321,966 | 318,704 | |
Other Liabilities | 3,410 | 3,608 | |
Total Liabilities | 421,868 | 416,668 | |
Member's Equity: | |||
Member's Equity | 8,364 | 6,354 | |
Retained Earnings | 18,351 | 20,417 | |
Total Stockholders' Deficit | 26,715 | 26,771 | |
Total Liabilities, Convertible Preferred Stock and Stockholders' Deficit | 448,583 | 443,439 | |
Prosper Funding LLC | Related Party | |||
Assets: | |||
Receivable from Related Party | 1,598 | 0 | |
Liabilities and Member's Equity: | |||
Payable to Related Party | $ 0 | $ 2,853 | |
[1] The following table presents the assets and liabilities of consolidated variable interest entities (“VIEs”), which are included in the Consolidated Balance Sheets above. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. Additionally, the assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. December 31, 2023 2022 Assets of consolidated VIEs, included in total assets above: Restricted Cash $ 23,546 $ 11,838 Loans Held for Sale, at Fair Value 161,501 499,765 Borrower Loans, Held at Fair Value 220,724 — Prepaid and Other Assets 972 3,210 Total assets of consolidated VIEs $ 406,743 $ 514,813 Liabilities of consolidated VIEs, included in total liabilities above: Notes Issued by Securitization Trust $ 214,798 $ — Warehouse Lines $ 160,207 $ 446,762 Other liabilities 550 $ — Total liabilities of consolidated VIEs $ 375,555 $ 446,762 (1) Includes amounts in consolidated variable interest entities presented separately in the table below. |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Operating Revenues: | |||
(Loss) Gain on Sale of Borrower Loans | $ (12,380,000) | $ (1,039,000) | $ 7,196,000 |
Total Operating Revenues | 136,930,000 | 183,268,000 | 115,576,000 |
Interest Income (Expense): | |||
Interest Income on Borrower Loans and Loans Held for Sale | 115,663,000 | 86,350,000 | 83,107,000 |
Interest Expense on Financial Instruments | (91,983,000) | (60,025,000) | (50,816,000) |
Total Interest Income, Net | 23,680,000 | 26,325,000 | 32,291,000 |
Change in Fair Value of Financial Instruments | (22,910,000) | (9,712,000) | (3,241,000) |
Total Net Revenue | 137,700,000 | 199,881,000 | 144,626,000 |
Expenses: | |||
Origination and Servicing | 46,669,000 | 56,457,000 | 35,056,000 |
Sales and Marketing | 53,585,000 | 81,896,000 | 35,065,000 |
General and Administrative | 85,533,000 | 83,658,000 | 73,122,000 |
Change in Fair Value of Convertible Preferred Stock Warrants | 48,695,000 | (84,595,000) | 138,622,000 |
Gain on Forgiveness of PPP Loan | 0 | (8,604,000) | 0 |
Loss on Deconsolidation of VIEs | 0 | 0 | 1,494,000 |
Impairment Expense | 196,000 | 0 | 0 |
Interest Expense on Term Loan | 12,265,000 | 1,527,000 | 0 |
Other Income, Net | (2,859,000) | (1,335,000) | (463,000) |
Total Expenses | 244,084,000 | 129,004,000 | 282,896,000 |
Net (Loss) Income Before Income Taxes | (106,384,000) | 70,877,000 | (138,270,000) |
Income Tax Expense | (78,000) | (295,000) | (71,000) |
Net (Loss) Income | (106,462,000) | 70,582,000 | (138,341,000) |
Less: Net Income Allocated to Participating Securities | 0 | (47,350,000) | 0 |
Net (Loss) Income Attributable to Common Stockholders | $ (106,462,000) | $ 23,232,000 | $ (138,341,000) |
Net (Loss) Income Per Share – Basic (in dollars per share) | $ (1.40) | $ 0.32 | $ (1.95) |
Net (Loss) Income Per Share – Diluted (in dollars per share) | $ (1.40) | $ 0.07 | $ (1.95) |
Weighted-Average Shares – Basic (in shares) | 76,092,569 | 73,291,714 | 70,767,275 |
Weighted-Average Shares – Diluted (in shares) | 76,092,569 | 348,593,594 | 70,767,275 |
Transaction Fees, Net | |||
Operating Revenues: | |||
Revenues | $ 127,838,000 | $ 162,742,000 | $ 89,364,000 |
Servicing Fees, Net | |||
Operating Revenues: | |||
Revenues | 15,364,000 | 15,113,000 | 15,024,000 |
Other Revenues | |||
Operating Revenues: | |||
Revenues | $ 6,108,000 | $ 6,452,000 | $ 3,992,000 |
Consolidated Statements of Op_2
Consolidated Statements of Operations - Prosper Funding LLC - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Operating Revenues: | |||
Loss (Gain) on Sale of Borrower Loans | $ (12,380) | $ (1,039) | $ 7,196 |
Total Operating Revenues | 136,930 | 183,268 | 115,576 |
Interest Income (Expense): | |||
Interest Income on Borrower Loans | 115,663 | 86,350 | 83,107 |
Interest Expense on Notes | (91,983) | (60,025) | (50,816) |
Total Interest Income, Net | 23,680 | 26,325 | 32,291 |
Change in Fair Value of Financial Instruments, Net | (22,910) | (9,712) | (3,241) |
Expenses: | |||
Total Expenses | 244,084 | 129,004 | 282,896 |
Net (Loss) Income | (106,462) | 70,582 | (138,341) |
Prosper Funding LLC | |||
Operating Revenues: | |||
Loss (Gain) on Sale of Borrower Loans | (11,285) | 1,678 | 8,450 |
Total Operating Revenues | 59,490 | 83,469 | 59,549 |
Interest Income (Expense): | |||
Interest Income on Borrower Loans | 52,188 | 45,289 | 36,952 |
Interest Expense on Notes | (48,572) | (42,165) | (34,514) |
Total Interest Income, Net | 3,616 | 3,124 | 2,438 |
Change in Fair Value of Financial Instruments, Net | 118 | 394 | 770 |
Total Net Revenues | 63,224 | 86,987 | 62,757 |
Expenses: | |||
Administration Fee – Related Party | 57,683 | 74,382 | 52,641 |
Servicing and Other, Net | 7,607 | 9,082 | 6,906 |
Total Expenses | 65,290 | 83,464 | 59,547 |
Net (Loss) Income | (2,066) | 3,523 | 3,210 |
Administration Fee Revenue – Related Party | Prosper Funding LLC | |||
Operating Revenues: | |||
Revenues | 44,211 | 60,256 | 34,017 |
Servicing Fees, Net | |||
Operating Revenues: | |||
Revenues | 15,364 | 15,113 | 15,024 |
Servicing Fees, Net | Prosper Funding LLC | |||
Operating Revenues: | |||
Revenues | 26,208 | 20,641 | 15,770 |
Other Revenues | |||
Operating Revenues: | |||
Revenues | 6,108 | 6,452 | 3,992 |
Other Revenues | Prosper Funding LLC | |||
Operating Revenues: | |||
Revenues | $ 356 | $ 894 | $ 1,312 |
Consolidated Statements of Conv
Consolidated Statements of Convertible Preferred Stock and Stockholders’ Deficit - USD ($) $ in Thousands | Total | Common Stock | Treasury Stock | Additional Paid-In Capital | Accumulated Deficit | Convertible Preferred Stock | Convertible Preferred Stock Held by Consolidated VIE |
Beginning balance (in shares) at Dec. 31, 2020 | 209,613,570 | (51,247,915) | |||||
Beginning balance at Dec. 31, 2020 | $ 322,748 | $ (2,381) | |||||
Ending balance (in shares) at Dec. 31, 2021 | 209,613,570 | (51,247,915) | |||||
Ending balance at Dec. 31, 2021 | $ 322,748 | $ (2,381) | |||||
Beginning balance (in shares) at Dec. 31, 2020 | 74,316,607 | ||||||
Beginning balance at Dec. 31, 2020 | $ (283,161) | $ 215 | $ (23,417) | $ 155,952 | $ (415,911) | ||
Beginning balance (in shares) at Dec. 31, 2020 | 5,177,235 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Exercise of vested stock options (in shares) | 3,014,622 | ||||||
Exercise of vested stock options | 61 | $ 30 | 31 | ||||
Stock-based compensation expense | 1,273 | 1,273 | |||||
Net (Loss) Income | (138,341) | (138,341) | |||||
Ending balance (in shares) at Dec. 31, 2021 | 77,331,229 | ||||||
Ending balance at Dec. 31, 2021 | $ (420,168) | $ 245 | $ (23,417) | 157,256 | (554,252) | ||
Ending balance (in shares) at Dec. 31, 2021 | 5,177,235 | ||||||
Ending balance (in shares) at Dec. 31, 2022 | 209,613,570 | 209,613,570 | (51,247,915) | ||||
Ending balance at Dec. 31, 2022 | $ 322,748 | $ (2,381) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Exercise of vested stock options (in shares) | 2,133,921 | ||||||
Exercise of vested stock options | $ 54 | $ 22 | 32 | ||||
Stock-based compensation expense | 1,526 | 1,526 | |||||
Net (Loss) Income | $ 70,582 | 70,582 | |||||
Ending balance (in shares) at Dec. 31, 2022 | 74,287,915 | 79,465,150 | |||||
Ending balance at Dec. 31, 2022 | $ (348,006) | $ 267 | $ (23,417) | 158,814 | (483,670) | ||
Ending balance (in shares) at Dec. 31, 2022 | 5,177,235 | ||||||
Ending balance (in shares) at Dec. 31, 2023 | 209,613,570 | 209,613,570 | (51,247,915) | ||||
Ending balance at Dec. 31, 2023 | $ 322,748 | $ (2,381) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Exercise of vested stock options (in shares) | 2,637,479 | ||||||
Exercise of vested stock options | $ 117 | $ 26 | 91 | ||||
Stock-based compensation expense | 1,804 | 1,804 | |||||
Net (Loss) Income | $ (106,462) | (106,462) | |||||
Ending balance (in shares) at Dec. 31, 2023 | 76,925,394 | 82,102,629 | |||||
Ending balance at Dec. 31, 2023 | $ (452,547) | $ 293 | $ (23,417) | $ 160,709 | $ (590,132) | ||
Ending balance (in shares) at Dec. 31, 2023 | 5,177,235 |
Consolidated Statements of Memb
Consolidated Statements of Member’s Equity - Prosper Funding LLC - USD ($) $ in Thousands | Total | Retained Earnings | Prosper Funding LLC | Prosper Funding LLC Retained Earnings | Prosper Funding LLC Member’s Equity |
Beginning balance at Dec. 31, 2020 | $ (283,161) | $ (415,911) | $ 25,088 | $ 13,684 | $ 11,404 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Distributions to Parent | 0 | 0 | |||
Net income (loss) | (138,341) | (138,341) | 3,210 | 3,210 | |
Ending balance at Dec. 31, 2021 | (420,168) | (554,252) | 28,298 | 16,894 | 11,404 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Distributions to Parent | (5,700) | (5,700) | |||
Contribution from Parent | 650 | 650 | |||
Net income (loss) | 70,582 | 70,582 | 3,523 | 3,523 | |
Ending balance at Dec. 31, 2022 | (348,006) | (483,670) | 26,771 | 20,417 | 6,354 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Contribution from Parent | 2,010 | 2,010 | |||
Net income (loss) | (106,462) | (106,462) | (2,066) | (2,066) | |
Ending balance at Dec. 31, 2023 | $ (452,547) | $ (590,132) | $ 26,715 | $ 18,351 | $ 8,364 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |||
Cash Flows from Operating Activities: | |||||
Net (Loss) Income | $ (106,462,000) | $ 70,582,000 | $ (138,341,000) | ||
Adjustments to Reconcile Net (Loss) Income to Net Cash Provided by (Used in) Operating Activities: | |||||
Change in Fair Value of Financial Instruments | 22,910,000 | 9,712,000 | 3,241,000 | ||
Depreciation and Amortization | 10,989,000 | 10,924,000 | 9,839,000 | ||
Amortization of Operating Lease Right-of-Use Asset | 2,408,000 | 3,545,000 | 3,774,000 | ||
Gain on Termination of Operating Lease Right-of-Use Asset | 0 | (88,000) | 0 | ||
Impairment of Operating Lease Right-of-Use Asset | 196,000 | 0 | 0 | ||
Recognition of Servicing Asset on Sale of Borrower Loans | (9,239,000) | (12,957,000) | (7,973,000) | ||
Change in Fair Value of Servicing Rights | 15,564,000 | 9,157,000 | 8,454,000 | ||
Stock-Based Compensation Expense | 1,575,000 | 1,326,000 | 1,136,000 | ||
Loss on Deconsolidation of VIEs | 0 | 0 | 1,494,000 | ||
Change in Fair Value of Convertible Preferred Stock Warrants | 48,695,000 | (84,595,000) | 138,622,000 | ||
Gain on Forgiveness of PPP Loan | 0 | (8,604,000) | 0 | ||
Accrual of Payment-in-kind Interest on Term Loan | 1,527,000 | 0 | 0 | ||
Other, Net | 1,497,000 | 12,000 | 2,027,000 | ||
Changes in Operating Assets and Liabilities: | |||||
Purchase of Loans Held for Sale at Fair Value | (1,921,129,000) | (3,063,729,000) | (1,712,705,000) | ||
Proceeds from Sales and Principal Payments of Loans Held for Sale at Fair Value | 1,989,170,000 | 2,783,971,000 | 1,770,822,000 | ||
Accounts Receivable | (4,061,000) | (2,408,000) | (449,000) | ||
Prepaid and Other Assets | (12,350,000) | (2,194,000) | 639,000 | ||
Credit Card Derivative | (561,000) | 3,304,000 | 0 | ||
Accounts Payable and Accrued Liabilities | 4,159,000 | 11,530,000 | 7,776,000 | ||
Payable to Investors | 1,420,000 | (67,482,000) | 28,700,000 | ||
Other Liabilities | 1,537,000 | 3,092,000 | (3,493,000) | ||
Net Cash Provided by (Used in) Operating Activities | 47,845,000 | (334,902,000) | 113,563,000 | ||
Cash Flows from Investing Activities: | |||||
Purchase of Borrower Loans Held at Fair Value | (232,306,000) | (284,921,000) | (231,998,000) | ||
Proceeds from Sales and Principal Payments of Borrower Loans Held at Fair Value | 191,077,000 | 202,119,000 | 236,861,000 | ||
Purchases of Property and Equipment | (15,722,000) | (13,063,000) | (12,041,000) | ||
Net Cash Used in Investing Activities | (56,951,000) | (95,865,000) | (7,178,000) | ||
Cash Flows from Financing Activities: | |||||
Proceeds from Issuance of Notes Held at Fair Value | 231,520,000 | 285,115,000 | 231,933,000 | ||
Payments of Notes Held at Fair Value | (188,670,000) | (202,308,000) | (172,250,000) | ||
Principal Payments on Notes Issued by Securitization Trust | (34,701,000) | 0 | (87,700,000) | ||
Principal Payments on Certificates Issued by Securitization Trust | 0 | 0 | (14,935,000) | ||
Net cash and restricted cash outflows from Deconsolidation of VIEs | 0 | 0 | (6,821,000) | ||
Proceeds from Issuance of Securitized Notes (Note 7) | 250,657,000 | 0 | 0 | ||
Proceeds from Warehouse Lines | 48,478,000 | 235,870,000 | 68,800,000 | ||
Principal payments on Warehouse Lines | (111,732,000) | 0 | (101,900,000) | ||
Extinguishment of PWIIT Warehouse Line (Note 11) | (223,968,000) | 0 | 0 | ||
Proceeds from Term Loan (Note 11) | 0 | 73,500,000 | 0 | ||
Principal payments on financing lease | 0 | (78,000) | (76,000) | ||
Payment for Debt Issuance Costs | (3,937,000) | (402,000) | (1,740,000) | ||
Proceeds from Exercise of Stock Options | 118,000 | 54,000 | 61,000 | ||
Net Cash (Used in) Provided by Financing Activities | (32,235,000) | 391,751,000 | (84,628,000) | ||
Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash | (41,341,000) | (39,016,000) | 21,757,000 | ||
Cash, Cash Equivalents and Restricted Cash at Beginning of the Period | 196,609,000 | 235,625,000 | 213,868,000 | ||
Cash, Cash Equivalents and Restricted Cash at End of the Period | 155,268,000 | 196,609,000 | 235,625,000 | ||
Supplemental Disclosure of Cash Flow Information: | |||||
Cash Paid for Interest | 97,431,000 | 58,114,000 | 49,923,000 | ||
Cash paid for operating leases included in the measurement of lease liabilities | 3,051,000 | 5,770,000 | 5,381,000 | ||
Non-Cash Investing Activity - Accrual for Property and Equipment, Net | 1,468,000 | 1,154,000 | 971,000 | ||
Non-Cash Investing Activity - Deconsolidation of Borrower Loans, at Fair Value | 0 | 0 | 78,361,000 | ||
Non-Cash Financing Activity - Accrual for Debt Issuance Costs | 550,000 | 0 | 0 | ||
Non-Cash Financing Activity - Forgiveness of PPP Loan | 0 | 8,604,000 | 0 | ||
Non-Cash Financing Activity - Deconsolidation of Notes Issued by Securitization Trust | 0 | 0 | 69,709,000 | ||
Non-Cash Financing Activity - Deconsolidation of Certificates Issued by Securitization Trust, at Fair Value | 0 | 0 | 13,979,000 | ||
Reconciliation to Amounts on Consolidated Balance Sheets | |||||
Cash and Cash Equivalents | 34,970,000 | 83,446,000 | 67,700,000 | ||
Restricted Cash | 120,298,000 | [1],[2] | 113,163,000 | [1],[2] | 167,925,000 |
Total Cash, Cash Equivalents and Restricted Cash | $ 155,268,000 | $ 196,609,000 | $ 235,625,000 | ||
[1] The following table presents the assets and liabilities of consolidated variable interest entities (“VIEs”), which are included in the Consolidated Balance Sheets above. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. Additionally, the assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. December 31, 2023 2022 Assets of consolidated VIEs, included in total assets above: Restricted Cash $ 23,546 $ 11,838 Loans Held for Sale, at Fair Value 161,501 499,765 Borrower Loans, Held at Fair Value 220,724 — Prepaid and Other Assets 972 3,210 Total assets of consolidated VIEs $ 406,743 $ 514,813 Liabilities of consolidated VIEs, included in total liabilities above: Notes Issued by Securitization Trust $ 214,798 $ — Warehouse Lines $ 160,207 $ 446,762 Other liabilities 550 $ — Total liabilities of consolidated VIEs $ 375,555 $ 446,762 (1) Includes amounts in consolidated variable interest entities presented separately in the table below. |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows - Prosper Funding LLC - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |||
Cash Flows from Operating Activities: | |||||
Net (Loss) Income | $ (106,462) | $ 70,582 | $ (138,341) | ||
Adjustments to Reconcile Net Income to Net Cash Provided by (Used in) Operating Activities: | |||||
Change in Fair Value of Financial Instruments, Net | 22,910 | 9,712 | 3,241 | ||
Gain on Sale of Borrower Loans | (9,239) | (12,957) | (7,973) | ||
Depreciation and Amortization | 10,989 | 10,924 | 9,839 | ||
Changes in Operating Assets and Liabilities: | |||||
Purchase of Loans Held for Sale, at Fair Value | (1,921,129) | (3,063,729) | (1,712,705) | ||
Proceeds from Sales and Principal Payments of Loans Held for Sale, at Fair Value | 1,989,170 | 2,783,971 | 1,770,822 | ||
Accounts Payable and Accrued Liabilities | 4,159 | 11,530 | 7,776 | ||
Payable to Investors | 1,420 | (67,482) | 28,700 | ||
Other Liabilities | 1,537 | 3,092 | (3,493) | ||
Net Cash Provided by (Used in) Operating Activities | 47,845 | (334,902) | 113,563 | ||
Cash Flows from Investing Activities: | |||||
Purchase of Borrower Loans, at Fair Value | (232,306) | (284,921) | (231,998) | ||
Proceeds from Sales and Principal Payments of Borrower Loans, at Fair Value | 191,077 | 202,119 | 236,861 | ||
Purchases of Property and Equipment | (15,722) | (13,063) | (12,041) | ||
Net Cash Used in Investing Activities | (56,951) | (95,865) | (7,178) | ||
Cash Flows from Financing Activities: | |||||
Proceeds from Issuance of Notes, at Fair Value | 231,520 | 285,115 | 231,933 | ||
Payments of Notes, at Fair Value | (188,670) | (202,308) | (172,250) | ||
Net Cash (Used in) Provided by Financing Activities | (32,235) | 391,751 | (84,628) | ||
Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash | (41,341) | (39,016) | 21,757 | ||
Cash, Cash Equivalents and Restricted Cash at Beginning of the Period | 196,609 | 235,625 | 213,868 | ||
Cash, Cash Equivalents and Restricted Cash at End of the Period | 155,268 | 196,609 | 235,625 | ||
Supplemental Disclosure of Cash Flow Information: | |||||
Cash Paid for Interest | 97,431 | 58,114 | 49,923 | ||
Non-Cash Investing Activity- Accrual for Property and Equipment, Net | 1,468 | 1,154 | 971 | ||
Reconciliation to Amounts on Consolidated Balance Sheets: | |||||
Cash and Cash Equivalents | 34,970 | 83,446 | 67,700 | ||
Restricted Cash | 120,298 | [1],[2] | 113,163 | [1],[2] | 167,925 |
Total Cash, Cash Equivalents and Restricted Cash | 155,268 | 196,609 | 235,625 | ||
Prosper Funding LLC | |||||
Cash Flows from Operating Activities: | |||||
Net (Loss) Income | (2,066) | 3,523 | 3,210 | ||
Adjustments to Reconcile Net Income to Net Cash Provided by (Used in) Operating Activities: | |||||
Change in Fair Value of Financial Instruments, Net | (118) | (394) | (770) | ||
Other Non-Cash Changes in Borrower Loans, Loans Held for Sale and Notes | 98 | 92 | 26 | ||
Gain on Sale of Borrower Loans | (10,151) | (15,278) | (9,020) | ||
Change in Fair Value of Servicing Rights | 11,193 | 10,214 | 10,312 | ||
Depreciation and Amortization | 6,268 | 5,525 | 4,878 | ||
Changes in Operating Assets and Liabilities: | |||||
Purchase of Loans Held for Sale, at Fair Value | (1,921,129) | (3,063,729) | (1,712,705) | ||
Proceeds from Sales and Principal Payments of Loans Held for Sale, at Fair Value | 1,921,129 | 3,063,729 | 1,712,705 | ||
Other Assets | (92) | 233 | (100) | ||
Accounts Payable and Accrued Liabilities | 3,545 | 2,758 | (543) | ||
Payable to Investors | 1,444 | (66,754) | 27,415 | ||
Net Related Party Receivable/Payable | (6,259) | 1,468 | (2,544) | ||
Other Liabilities | (198) | 1,174 | (179) | ||
Net Cash Provided by (Used in) Operating Activities | 3,664 | (57,439) | 32,685 | ||
Cash Flows from Investing Activities: | |||||
Purchase of Borrower Loans, at Fair Value | (232,306) | (284,921) | (231,998) | ||
Proceeds from Sales and Principal Payments of Borrower Loans, at Fair Value | 191,079 | 202,119 | 172,709 | ||
Purchases of Property and Equipment | (6,097) | (7,543) | (6,127) | ||
Net Cash Used in Investing Activities | (47,324) | (90,345) | (65,416) | ||
Cash Flows from Financing Activities: | |||||
Proceeds from Issuance of Notes, at Fair Value | 231,520 | 285,115 | 231,933 | ||
Payments of Notes, at Fair Value | (188,670) | (202,308) | (172,250) | ||
Cash Contribution from Parent | 0 | 650 | 0 | ||
Cash Distributions to Parent | 0 | (5,700) | 0 | ||
Net Cash (Used in) Provided by Financing Activities | 42,850 | 77,757 | 59,683 | ||
Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash | (810) | (70,027) | 26,952 | ||
Cash, Cash Equivalents and Restricted Cash at Beginning of the Period | 97,849 | 167,876 | 140,924 | ||
Cash, Cash Equivalents and Restricted Cash at End of the Period | 97,039 | 97,849 | 167,876 | ||
Supplemental Disclosure of Cash Flow Information: | |||||
Cash Paid for Interest | 47,758 | 41,431 | 34,682 | ||
Non-Cash Investing Activity- Accrual for Property and Equipment, Net | 2,121 | 313 | 234 | ||
Non-Cash Financing Activity - Contribution of Borrower Loans by Parent (Note 4) | 2,010 | 0 | 0 | ||
Reconciliation to Amounts on Consolidated Balance Sheets: | |||||
Cash and Cash Equivalents | 3,351 | 6,285 | 10,765 | ||
Restricted Cash | 93,688 | 91,564 | 157,111 | ||
Total Cash, Cash Equivalents and Restricted Cash | $ 97,039 | $ 97,849 | $ 167,876 | ||
[1] The following table presents the assets and liabilities of consolidated variable interest entities (“VIEs”), which are included in the Consolidated Balance Sheets above. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. Additionally, the assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. December 31, 2023 2022 Assets of consolidated VIEs, included in total assets above: Restricted Cash $ 23,546 $ 11,838 Loans Held for Sale, at Fair Value 161,501 499,765 Borrower Loans, Held at Fair Value 220,724 — Prepaid and Other Assets 972 3,210 Total assets of consolidated VIEs $ 406,743 $ 514,813 Liabilities of consolidated VIEs, included in total liabilities above: Notes Issued by Securitization Trust $ 214,798 $ — Warehouse Lines $ 160,207 $ 446,762 Other liabilities 550 $ — Total liabilities of consolidated VIEs $ 375,555 $ 446,762 (1) Includes amounts in consolidated variable interest entities presented separately in the table below. |
ORGANIZATION AND BUSINESS
ORGANIZATION AND BUSINESS | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
ORGANIZATION AND BUSINESS | ORGANIZATION AND BUSINESS Prosper Marketplace, Inc. (“PMI” or the “Company”) was incorporated in the state of Delaware on March 22, 2005. Except as the context requires otherwise, as used in these notes to consolidated financial statements of PMI, “Prosper,” “we,” “us,” and “our” refer to PMI and its wholly-owned subsidiaries, on a consolidated basis. PMI developed a peer-to-peer online credit marketplace (the “marketplace”), and in February 2013, transferred ownership of the marketplace to Prosper Funding LLC (“PFL”), its wholly-owned subsidiary. All of the borrower payment dependent notes (“Notes”) issued and sold through the marketplace today are issued and sold by PFL. PFL also operates the marketplace and facilitates the origination of unsecured, personal loans by WebBank (“Borrower Loans”), an FDIC-insured, Utah-chartered industrial bank, through the marketplace. Pursuant to a Loan Account Program Agreement between PMI and WebBank, PMI manages the operation of the marketplace as an agent of WebBank in connection with the submission of loan applications by potential borrowers. PMI also manages the origination of related loans by WebBank and the funding of such Borrower Loans by WebBank. On February 1, 2013, PFL entered into an Administration Agreement with PMI in its capacity as licensee, corporate administrator, loan marketplace administrator and loan and Note servicer, pursuant to which PMI provides certain back office support, loan platform administration and loan servicing to PFL. A borrower who wishes to obtain a Borrower Loan through the marketplace must post a loan listing on the marketplace. Listings are allocated to one of two investor funding channels: (i) the “Note Channel,” which allows investors to commit to purchase Notes from PFL, the payments of which are dependent on PFL’s receipt of payments made on the corresponding Borrower Loan; and (ii) the “Whole Loan Channel,” which allows investors to commit to purchase 100% of a Borrower Loan directly from Prosper. As of December 31, 2023, the marketplace is open to investors in 31 states and the District of Columbia. Additionally, as of December 31, 2023, the marketplace is open to borrowers in 48 states and the District of Columbia. Currently our marketplace does not operate internationally. In December 2021, the Company launched its Prosper Credit Card product in partnership with Coastal Community Bank (“Coastal”), through which eligible consumers are extended unsecured credit through Prosper-branded Credit Cards. In accordance with our program agreement with Coastal, the receivables associated with these Credit Cards are maintained on the balance sheet of Coastal. Customer accounts are then randomly designated as either Prosper Allocations or Coastal Allocations on an approximate 90% to 10% split, respectively. Each party receives 100% of the interest income and is responsible for the credit losses on its allocated customer accounts. PMI is responsible for verified fraud losses across the entire portfolio and a portion of straight charge-off losses. Credit Card receivables are not available on the Company’s personal loan marketplace for investment purposes. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
ORGANIZATION AND BUSINESS | ORGANIZATION AND BUSINESS Prosper Funding LLC (“PFL”) was formed in the state of Delaware in February 2012 as a limited liability company with Prosper Marketplace, Inc. (“PMI”) as its sole equity member. Except as the context otherwise requires, as used in these Notes to consolidated financial statements of Prosper Funding LLC, PFL and the “Company” refer to Prosper Funding LLC and its wholly owned subsidiary, Prosper Depositor LLC, a Delaware limited liability company, on a consolidated basis. PFL was formed by PMI to hold Borrower Loans and issue Notes through the marketplace. Although PFL is consolidated with PMI for accounting and tax purposes, PFL has been organized and is operated in a manner that is intended to minimize the likelihood that it would be substantively consolidated with PMI in a bankruptcy proceeding. PFL’s intention is to minimize the likelihood that its assets would be subject to claims by PMI’s creditors if PMI were to file for bankruptcy, as well as to minimize the likelihood that PFL will become subject to bankruptcy proceedings directly. PFL seeks to achieve this by placing certain restrictions on its activities and implementing certain formal procedures designed to expressly reinforce its status as a distinct entity from PMI. Since February 1, 2013, all Notes issued and sold through the marketplace are issued, sold and serviced by PFL. Pursuant to a Loan Account Program Agreement between PMI and WebBank, PMI manages the operation of the marketplace, as agent of WebBank, in connection with the submission of Borrower Loan applications by potential borrowers, the origination of related Borrower Loans by WebBank and the funding of such Borrower Loans by WebBank. Pursuant to an Administration Agreement between PFL and PMI, PMI manages all other aspects of the marketplace on behalf of PFL. As a result PFL earns significant revenues and incurs significant expenses with a related party, its direct parent company, PMI. A borrower who wishes to obtain a loan through the marketplace must post a loan listing on the marketplace. PFL allocates listings to one of two investor funding channels: (i) the “Note Channel,” which allows investors to commit to purchase Notes from PFL, the payments of which are dependent on PFL’s receipt of payments made on the corresponding Borrower Loan; and (ii) the “Whole Loan Channel,” which allows investors to commit to purchase 100% of a Borrower Loan directly from PFL. All loans requested and obtained through the marketplace are unsecured obligations of individual borrowers with a fixed interest rate and original terms to maturity of 24, 36, 48 or 60 months as of December 31, 2023. All loans made through the marketplace are funded by WebBank, an FDIC-insured, Utah chartered industrial bank. After funding a loan, WebBank sells the loan to PFL, without recourse to WebBank, in exchange for the principal amount of the loan. WebBank does not have any obligation to purchasers of the Notes. As of December 31, 2023, PFL’s marketplace was open to investors in 31 states and the District of Columbia. Additionally, as of December 31, 2023, PFL’s marketplace was open to borrowers in 48 states and the District of Columbia. Currently, the marketplace does not operate internationally. |
SUMMARY OF SIGNIFICANT ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNT POLICIES | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
SUMMARY OF SIGNIFICANT ACCOUNT POLICIES | SUMMARY OF SIGNIFICANT ACCOUNT POLICIES Basis of Presentation The accompanying consolidated financial statements include the accounts of PMI and its wholly owned subsidiaries including PFL, Prosper Healthcare Lending LLC (“PHL”), BillGuard, Inc. (“BillGuard”), and its consolidated VIEs including Prosper Warehouse I Trust (“PWIT”), Prosper Warehouse II Trust (“PWIIT,” terminated September 25, 2023), Prosper Marketplace Issuance Trust, Series 2023-1 (“PMIT 2023-1”), and Prosper Grantor Trust (“PGT”). All intercompany balances and transactions between PMI and its subsidiaries have been eliminated in consolidation. PMI and PFL’s financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). PMI did not have any items of other comprehensive income (loss) during any of the periods presented in the consolidated financial statements as of and for the years ended December 31, 2023, 2022 and 2021. Notes Issued by Securitization Trust are notes held by certain third-party investors pursuant to Prosper’s securitization transaction, and are distinguishable from the borrower payment dependent Notes available to investors through the Company’s Note Channel. Use of Estimates The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures, including contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These estimates, judgments and assumptions include but are not limited to the following: valuation of Loans Held for Sale, Borrower Loans and associated Notes, valuation of servicing rights, loan trailing fee liability and Credit Card Derivative, valuation allowance on deferred tax assets, stock-based compensation expense, Intangible Assets, Goodwill, Convertible Preferred Stock Warrant Liability, Repurchase Obligations and contingent liabilities. These judgments, estimates and assumptions are inherently subjective in nature and actual results may differ from these estimates and assumptions. Consolidation of Variable Interest Entities A variable interest entity (VIE) is a legal entity that has either a total equity investment that is insufficient to finance its activities without additional subordinated financial support or whose equity investors lack the characteristics of a controlling financial interest. Prosper’s variable interest arises from contractual, ownership or other monetary interests in the entity, which change with fluctuations in the fair value of the entity’s net assets. A VIE is consolidated by its primary beneficiary, which is the party that has both the power to direct the activities that most significantly impact the VIE’s economic performance, and the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. Prosper consolidates a VIE when it is deemed to be the primary beneficiary. Prosper assesses whether or not it is the primary beneficiary of a VIE on an ongoing basis. Transfers of Financial Assets Prosper accounts for transfers of financial assets as sales when it has surrendered control over the transferred assets. Control is generally considered to have been surrendered when the transferred assets have been legally isolated from Prosper, the transferee has the right to pledge or exchange the assets without any significant constraints, and Prosper has not entered into a repurchase agreement, does not hold unconditional call options and has not written put options on the transferred assets. In assessing whether control has been surrendered, Prosper considers whether the transferee would be a consolidated affiliate and the impact of all arrangements or agreements made contemporaneously with, or in contemplation of the transfer, even if they were not entered into at the time of transfer. Prosper measures gain or loss on sale of financial assets as the net proceeds received on the sale less the carrying amount of the loans sold. The net proceeds of the sale include the fair value of any assets obtained or liabilities incurred as part of the transaction, including, but not limited to Servicing Assets, retained securities, and recourse obligations. Fair Value Measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial instruments measured at fair value consist principally of Borrower Loans, Loans Held for Sale (Note 4), Servicing Assets (Note 6), Credit Card Derivative (Note 5), Loan Trailing Fee Liabilities (Note 10), Debt (Note 11) and Convertible Preferred Stock Warrant Liability (Note 13). The estimated fair values of other financial instruments, including Cash and Cash Equivalents, Restricted Cash, Accounts Receivable, Accounts Payable and Accrued Liabilities, and Payable to Investors approximate their carrying values because of their short-term nature. The estimated fair values of the Term Loan and Warehouse Lines (Note 11) do not approximate their carrying values due primarily to differences in the stated and market rates associated with these instruments. The fair value hierarchy includes a three-level classification, which is based on whether the inputs to the valuation methodology used for measurement are observable: Level 1 — Quoted market prices in active markets for identical assets or liabilities. Level 2 — Inputs other than quoted prices included in Level 1 that are observable for the asset or liability either directly or indirectly. Level 3 — Unobservable inputs. When developing fair value measurements, Prosper maximizes the use of observable inputs and minimizes the use of unobservable inputs. However, for certain instruments Prosper must utilize unobservable inputs in determining fair value due to the lack of observable inputs in the market, which requires greater judgment in measuring fair value. In instances where there is limited or no observable market data, fair value measurements for assets and liabilities are determined using assumptions that management believes a market participant would use in pricing the asset or liability. As observable market prices are not available for the Borrower Loans, Loans Held for Sale, Notes, Servicing Assets and Credit Card Derivative, or for similar assets and liabilities, Prosper believes the Borrower Loans, Loans Held for Sale, Notes, Servicing Assets and Credit Card Derivative are considered level 3 financial instruments. Prosper primarily uses a discounted cash flow model to estimate their fair value, and key assumptions used in valuation include default rates and prepayment rates derived from market data and historical performance and discount rates based on estimates of the rates of return that investors would require when investing in financial instruments with similar characteristics. The obligation to pay principal and interest on any series of Notes is equal to the loan payments, if any, that are received on the corresponding Borrower Loan, net of our servicing fee which is 1.0% of the outstanding balance. The fair value election for Notes and Borrower Loans allows both the assets and the related liabilities to receive similar accounting treatment for expected losses which is consistent with the subsequent cash flows to investors that are dependent upon borrower payments. As such, the fair value of a series of Notes is approximately equal to the fair value of the corresponding Borrower Loan, adjusted for the 1.0% servicing fee and the timing of loan purchase, Note issuance and borrower payments. As a result, the valuation of the Notes uses the same methodology and assumptions as the Borrower Loans, except that the Notes incorporate the 1.0% servicing fee and any differences in timing in payments. The effective interest rate associated with a group of Notes is less than the interest rate earned on the corresponding Borrower Loan due to the 1.0% servicing fee. Refer to Note 8, Fair Value of Assets and Liabilities, for additional fair value disclosures. Cash and Cash Equivalents Cash includes various unrestricted deposits with investment-grade rated financial institutions. Cash equivalents consist of highly liquid marketable securities with original maturities of three months or less at the time of purchase and consist primarily of money market funds, commercial paper, US treasury securities and US agency securities. Cash equivalents are recorded at cost, which approximates fair value. At times, our cash balances may exceed federally insured amounts and potentially subject the Company to a concentration of credit risk. The Company believes that no significant concentration of credit risk exists with respect to these balances based on its assessment of the creditworthiness of these financial institutions. Restricted Cash Restricted cash consists primarily of cash deposits, money market funds and short term certificate of deposit accounts held as collateral as required for loan funding and servicing activities, and cash that investors or Prosper have on the marketplace that has not yet been invested in Borrower Loans or disbursed to the investor. Borrower Loans, Loans Held for Sale and Notes Borrower Loans are funded either through the Note Channel or through the Whole Loan Channel. Through the Note Channel, Prosper purchases Borrower Loans from WebBank, then issues Notes and holds the Borrower Loans until maturity. The obligation to repay a series of Notes issued through the Note Channel is dependent upon the repayment of the associated Borrower Loan. Borrower Loans funded and Notes issued through the Note Channel are carried on Prosper’s consolidated balance sheets as assets and liabilities, respectively. Prosper uses Warehouse Lines to purchase Loans Held for Sale that may be subsequently contributed to securitization transactions or sold to investors. Loans Held for Sale are included in “Loans Held for Sale, at Fair Value” on the Consolidated Balance Sheets. See Note 11, Debt, for more details on Warehouse Lines. In September 2023, Prosper closed a securitization transaction (the “PMIT 2023-1 Transaction”) with personal loans previously funded through its PWIIT Warehouse Line. The newly formed securitization entity, PMIT 2023-1, issued notes acquired by third parties and residual certificates acquired by PMI (a majority owned affiliate of PFL, the sole sponsor of the securitization). PMIT 2023-1 is deemed a consolidated VIE, and as a result the Borrower Loans it holds are presented in “Borrower Loans, at Fair Value,” and the notes sold to third-party investors are included in “Notes Issued by Securitization Trust” on the accompanying Consolidated Balance Sheet. See Note 7, Securitizations , for additional disclosures. Borrower Loans and Loans Held for Sale are purchased from WebBank. Prosper places Borrower Loans and Loans Held for Sale on non-accrual status when they are 120 days past due. When a loan is placed on non-accrual status, Prosper stops accruing interest and reverses all accrued but unpaid interest as of such date. Additionally, Prosper charges-off Borrower Loans and Loans Held for Sale when they are 120 days past due. The fair value of loans 120 or more days past due generally consists of the expected recovery from debt sales in subsequent periods. Prosper has elected the fair value option for Borrower Loans, Loans Held for Sale and Notes. Changes in fair value of Borrower Loans funded through the Note Channel are largely offset by the changes in fair value of Notes due to the borrower payment-dependent design of the Notes. Changes in fair value of Loans Held for Sale are recorded through Proper's earnings and Prosper collects interest on Loans Held for Sale. Changes in the fair values of Borrower Loans, Loans Held for Sale and Notes are included in Change in Fair Value of Financial Instruments on the accompanying Consolidated Statements of Operations. Prosper primarily uses a discounted cash flow model to estimate the fair value of Borrower Loans, Loans Held for Sale and Notes. The key assumptions used in the valuation include default rates and prepayment rates derived primarily from historical performance, and discount rates based on estimates of the rates of return that investors would require when investing in financial instruments with similar characteristics. Credit Card Derivative The Company evaluated the terms of the Credit Card program agreement (the “Credit Card Program Agreement”) with Coastal Community Bank (“Coastal”) and determined that it contained features that met the definition of derivatives under Accounting Standards Codification (“ASC”) 815, Derivatives and Hedging . These features are freestanding financial instruments (as defined under ASC 480, Distinguishing Liabilities from Equity ), and have been valued separately as derivatives. A right of offset exists between the derivatives, and they are presented net on the accompanying consolidated balance sheets. Changes in the fair value of the Credit Card Derivative, as well as settled transactions from the Credit Card portfolio, are recorded in Change in Fair Value of Financial Instruments on the accompanying Consolidated Statements of Operations. In August 2023, the Company executed an amendment to the Credit Card Program Agreement that, among other things, (a) increased the maximum outstanding Credit Card principal balance for Prosper Allocations from $200 million to $300 million, (b) funded a cash reserve account in the name of Coastal in connection with charge-off losses on receivables allocated to Prosper, and (c) clarified various items from the original program agreement. As a result of (b), the Company reclassified approximately $9.3 million in Restricted Cash held in the reserve account to Prepaid and Other Assets on the accompanying Consolidated Balance Sheets. Refer to Note 5, Credit Card, for additional details on revenues and expenses related to the Credit Card product. Servicing Assets Prosper records Servicing Assets at their estimated fair values for servicing rights retained when Prosper sells Borrower Loans to unrelated third-party buyers. The change in fair value of Servicing Assets is recognized in Servicing Fees, Net. The gain or loss on a loan sale is recorded in (Loss) Gain on Sale of Borrower Loans while the fair value of the servicing rights, which is based on the degree to which the contractual loan servicing fee is above or below an estimated market servicing rate is recorded in Servicing Assets on the Consolidated Balance Sheets. Prosper uses a discounted cash flow model to estimate the fair value of the loan Servicing Assets which considers the contractual servicing fee revenue that Prosper earns on the Borrower Loans, the estimated market servicing rates to service such loans, the prepayment rates, the default rates and the current principal balances of the Borrower Loans. Property and Equipment Property and Equipment consists of computer equipment, office furniture and equipment, leasehold improvements, software purchased or developed for internal use and web site development costs. Property and Equipment is stated at cost, less accumulated depreciation and amortization, and is computed using the straight-line method based upon estimated useful lives of the assets. Estimated useful lives of the assets are as follows: Furniture and fixtures 7 years Office equipment 5 years Computers and equipment 3 years Leasehold improvements 5 - 8 years Software and website development costs 1 - 5 years The costs to develop software for the website and other internal uses are capitalized when management has authorized and committed project funding, when preliminary development efforts are successfully completed, and when it is probable that the project will be completed, and the software will be used as intended. Capitalized software and website development costs primarily include software licenses acquired, fees paid to outside consultants and salaries and payroll-related costs for employees directly involved in the development efforts. Costs incurred prior to meeting these criteria, together with costs incurred for training and maintenance, are expensed. Costs incurred for upgrades and enhancements that are considered to be probable to result in additional functionality are capitalized. Capitalized costs are included in Property and Equipment and amortized to expense using the straight-line method over their expected lives. Software and website development assets are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. The recoverability of software and website development assets to be held and used is measured by a comparison of the carrying amount of the asset group to the future net undiscounted cash flows expected to be generated by the asset group. If such software and website development assets are considered to be impaired, the impairment to be recognized is the excess of the carrying amount over the fair value of the software and website development asset group. Leases Management determines if an arrangement is a lease at inception. Operating lease right-of-use (“ROU”) assets and operating lease liabilities are included on the Consolidated Balance Sheets in Property and Equipment, Net and in Other Liabilities, respectively. For certain leases with original terms of twelve months or less, PMI recognizes the lease expense as incurred and does not record ROU assets and lease liabilities. If a contract contains a lease, management evaluates whether it should be classified as an operating or finance lease. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. As most of PMI's leases do not provide an implicit rate, management uses an incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The operating lease ROU assets are evaluated for impairment utilizing the same impairment model used for Property and Equipment. Goodwill and Intangibles Goodwill associated with business combinations is computed by recognizing the portion of the purchase price that is not tied to individually identifiable and separately recognizable assets. Goodwill is assigned to the Company’s reporting units at the acquisition date according to the expected economic benefits that the acquired business will provide to the reporting unit. A reporting unit is a business operating segment or a component of a business operating segment. The Company identifies its reporting units based on how the operating segments and reporting units are managed. Accordingly, the Company allocated the entire balance of goodwill to the Personal Loan reportable and operating segment. Refer to Note 21 for further information on the Company’s reportable and operating segments. Goodwill is not amortized but is tested for impairment annually or whenever indications of impairment exist. Annual impairment testing occurs on October 1. Impairment exists whenever the carrying value of Goodwill exceeds its implied fair value. Adverse changes in impairment indicators such as loss of key personnel, increased regulatory oversight or unplanned changes in operations could result in impairment. Costs of internally developing any intangibles is expensed as incurred. Intangible Assets identified through the acquisitions of American Healthcare Lending and BillGuard include customer relationships, technology and a brand name. The user base and customer relationship Intangible Assets are being amortized on an accelerated basis over a three three Payable to Investors Payable to Investors primarily represents the obligation to investors related to cash held in an account for the benefit of investors and payments-in-process received from borrowers. Term Loan Prosper entered into a Credit Agreement, which provided for a Term Loan with a third-party financial institution in November 2022, which is more fully described in Note 11. This Term Loan is carried at amortized cost, net of discounts and issuance costs, which are subsequently amortized to Interest Expense on Term Loan over the life of the underlying agreement. Interest Expense on Term Loan is presented as a component of Expenses on the accompanying Consolidated Statements of Operations, except for any portion associated with Term Loan proceeds used to purchase Loans Held for Sale through the Company’s Warehouse Lines, which is presented in Interest Expense on Financial Instruments as a component of Net Interest Income on the accompanying Consolidated Statement of Operations. Warehouse Lines Warehouse Lines are carried at amortized cost. Prosper defers specific incremental costs directly related to entering into the Warehouse Lines and subsequently amortizes them into interest expense over the life of the arrangements. Convertible Preferred Stock Warrant Liability Prosper has entered into varying arrangements with investors to issue preferred stock warrants in exchange for their participation as a purchaser of Borrower Loans. In all cases, these warrants are free standing financial instruments due to their status as legally detached and separately exercisable warrants without conditions requiring Prosper to repurchase those warrants or the underlying preferred shares. These freestanding warrants are accounted for in accordance with ASC 480, Distinguishing Liabilities from Equity . Under ASC 480, vested freestanding warrants to purchase the Company’s convertible redeemable preferred stock are classified as a liability on the Consolidated Balance Sheets and carried at fair value because the warrants may conditionally obligate the Company to transfer assets at some point in the future. The Company records the warrants at fair value on issuance. The warrants are subject to remeasurement to fair value at each balance sheet date, and any change in their fair value is recognized as “Change in Fair Value of Convertible Preferred Stock Warrants” in the Consolidated Statements of Operations. The Company will continue to adjust the liability for changes in fair value until the earlier of the exercise or expiration of the warrants, the completion of a deemed liquidation event or the conversion of convertible redeemable preferred stock into Common Stock. Loan Trailing Fee Liability On July 1, 2016, Prosper signed a series of agreements with WebBank which, among other things, includes an additional program fee (the “Loan Trailing Fee”) paid to WebBank in connection with the performance of each loan sold to Prosper. These agreements became effective as of August 1, 2016. The Loan Trailing Fee is dependent on the amount and timing of principal and interest payments made by borrowers of the underlying loans, irrespective of whether the loans are sold by Prosper, and gives WebBank an ongoing financial interest in the performance of the loans it originates. This fee is paid by Prosper to WebBank over the term of the respective loans and is a function of the principal and interest payments made by borrowers of such loans. In the event that principal and interest payments are not made with respect to any loan, Prosper is not required to make the related Loan Trailing Fee payment. The obligation to pay the Loan Trailing Fee for any loan sold to Prosper is recorded at fair value at the time of the origination of such loan within Other Liabilities and recorded as a reduction of “Transaction Fees, net”. Any changes in the fair value of this liability are recorded in “Servicing Fees, Net” on the Consolidated Statements of Operations. The fair value of the Loan Trailing Fee represents the present value of the expected monthly Loan Trailing Fee payments, which takes into consideration certain assumptions related to expected prepayment rates and defaults rates. Revenue Recognition Revenue primarily results from Transaction and Servicing Fees and Net Interest Income earned. Fees include Transaction Fees for our services performed on behalf of WebBank to originate a loan, as well as program fees and broker fees generated from our Credit Card product and Home Equity Products, respectively. PMI also has other smaller sources of revenue reported as Other Revenues, including referral and incentive fees. Transaction Fees Prosper has a customer contract with WebBank to facilitate the origination of all Borrower Loans through Prosper’s marketplace. In exchange for these services, Prosper earns a transaction fee from WebBank that is recognized when performance is complete and upon the successful origination of a Borrower Loan. The transaction fee Prosper earns is determined by the term and credit grade of the Borrower Loan that is facilitated on Prosper’s marketplace, and ranges from 1.00% to 7.99% of the original principal amount of each Borrower Loan that WebBank originates. Prosper records the transaction fee net of any fees paid to WebBank because Prosper does not receive an identifiable benefit from WebBank other than the borrower loan that has been recognized at fair value. Additionally, the Company assumes WebBank’s obligation under Utah law to refund the pro-rated amount of the transaction fee in excess of 5% in the event of a borrower prepayment of the loan in full before maturity. Actual and expected refunds are recorded as a reduction of “Transaction Fees, Net” on the Company’s Consolidated Statements of Operations, and are included in “Accounts Payable and Accrued Liabilities” on the Company’s Consolidated Balance Sheets (Note 17). The Company also generates various Credit Card program fees through its partnership with Coastal. These include interchange fees, annual fees and late fees, which compensate Prosper for its role in marketing and growing the Credit Card product. Interchange and late fees are recognized as they are generated each month, while annual fees received are deferred and recognized over the annual period to which they relate. Additionally, the Company generates broker fees on Home Equity Products through its partnerships with its Home Lending Partners. Servicing Fees Investors who purchase Borrower Loans from Prosper typically pay Prosper a servicing fee which is generally set at 1.0% pe r annum of the outstanding principal balance of the borrower loan prior to applying the current payment, plus an additional 0.075% per annum to cover the Loan Trailing Fee. The servicing fee compensates Prosper for the costs incurred in servicing the borrower loan, including managing payments from borrowers, managing payments to investors and maintaining investors’ account portfolios. Prosper records Servicing Fees from investors as a component of operating revenue when received. Under the Credit Card program agreement, Prosper is responsible for servicing the entire underlying Credit Card portfolio. Coastal pays the Company a 1% per annum servicing fee on the daily outstanding balance of receivables designated as Coastal Allocations. To the extent these servicing fees do not exceed the market servicing rate a market participant would require to service the entire Credit Card portfolio, the Company records a servicing obligation liability and measures it at fair value throughout the servicing period. Changes in the fair value of the servicing obligation liability are recorded in Servicing Fees. (Loss) Gain on Sale of Borrower Loans Prosper recognizes gains or losses on the sale of Borrower Loans when it sells Borrower Loans to third parties. Prosper measures gain or loss on sale of Borrower Loans as the net proceeds received on a sale less the fair value of the Borrower Loans sold. The net proceeds of the sale represent the fair value of any assets obtained or liabilities incurred as part of the transaction, including, but not limited to Servicing Assets, retained securities, repurchase obligations and any incentives provided or received at the time of sale. Interest Income on Borrower Loans and Loans Held for Sale and Interest Expense on Financial Instruments Prosper recognizes interest income on Borrower Loans and Loans Held for Sale using the accrual method based on the stated interest rate to the extent we believe it to be collectible. We record interest expense on the corresponding Notes, at Fair Value, Notes Issued by Securitization Trust and Warehouse Lines based on the contractual interest rates. Other Revenues Other Revenues consist primarily of credit referral fees. These fees are earned from partner companies for the referral of customers on the Company’s platform. The transaction price is a fixed amount per referral and is recognized by the Company upon a successful referral. Other revenues also include incentive fees earned from partner companies through established incentive programs and miscellaneous net fees related to the Company’s Credit Card program. As of December 31, 2023, Prosper had no contract assets, contract liabilities or deferred contract costs. As of December 31, 2023, Prosper had no unsatisfied performance obligations related to Transaction Fees or Other Revenues. Advertising Costs Advertising costs are expensed when incurred and are included in “Sales and Marketing” expense in the accompanying Consolidated Statements of Operations. Prosper incurred advertising costs of $17.6 million , $15.0 million and $6.1 million for the years ended December 31, 2023, 2022 and 2021, respectively. Stock-Based Compensation Management determines the fair value of the Company's stock options issued to employees on the date of grant using the Black-Scholes option pricing model, which is impacted by the fair value of Common Stock as well as by changes in assumptions that include, but are not limited to, the expected Common Stock price volatility over the term of the option awards, the expected term of the awards, risk-free interest rates and the expected dividend yield. PMI recognizes compensation expense for stock-based awards on a straight-line basis over the period during which an employee is required to provide services in exchange for the award (the vesting period of the award). Stock-based compensation expense is recognized only for those awards expected to vest. PMI estimates future forfeitures at the date of grant and revises the estimates, if necessary, in subsequent periods if actual forfeitures differ from estimates. Stock-based awards issued to non-employees are marked-to-market up until the point that the awards measurement period has been achieved. Compensation expense for stock options issued to non-employees is calculated using the Black-Scholes option pricing model and is recorded over the vesting period of the award. Income Taxes The asset and liability method is used to account for income taxes. Under this method, deferred income tax assets and liabilities are based on the differences between the financial statement carrying values and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Prosper’s policy is to include interest and penalties related to gross unrecognized tax benefits within its provision for income taxes. U.S. Federal, California and other state income tax returns are filed. Prosper is not currently undergoing any income tax examinations. Due to the cumulative net operating loss, generally all tax years remain open. Prosper recognizes benefits from uncertain tax positions only if management believes that it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon settlement. Other Income, Net Other Income, Net consists primarily of interest inc |
Prosper Funding LLC | |
Entity Information [Line Items] | |
SUMMARY OF SIGNIFICANT ACCOUNT POLICIES | SUMMARY OF SIGNIFICANT ACCOUNT POLICIES Basis of Presentation PFL’s consolidated financial statements include the accounts of PFL and its wholly-owned subsidiary, Prosper Depositor LLC. All intercompany balances and transactions between PFL and Prosper Depositor LLC have been eliminated in consolidation. PFL’s financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). PFL did not have any items of other comprehensive income (loss) during any of the periods presented in the consolidated financial statements as of and for the years ended December 31, 2023, 2022 and 2021. Use of Estimates The preparation of PFL’s consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. These estimates, judgments and assumptions include, but are not limited to, the following: valuation of Loans Held for Sale, Borrower Loans and associated Notes, valuation of servicing rights, valuation of loan trailing fee liability, repurchase obligations, and contingent liabilities. PFL bases its estimates on historical experience from all Borrower Loans and on various other assumptions that it believes to be reasonable under the circumstances. Actual results could differ materially from estimates. Consolidation of Variable Interest Entities A variable interest entity (VIE) is a legal entity that has either a total equity investment that is insufficient to finance its activities without additional subordinated financial support or whose equity investors lack the characteristics of a controlling financial interest. PFL’s variable interest arises from contractual, ownership or other monetary interests in the entity, which change with fluctuations in the fair value of the entity’s net assets. A VIE is consolidated by its primary beneficiary, which is the party that has both the power to direct the activities that most significantly impact the VIE’s economic performance, and the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. PFL consolidates a VIE when it is deemed to be the primary beneficiary. PFL assesses whether or not it is the primary beneficiary of a VIE on an ongoing basis. Transfers of Financial Assets PFL accounts for transfers of financial assets as sales when it has surrendered control over the transferred assets. Control is generally considered to have been surrendered when the transferred assets have been legally isolated from PFL, the transferee has the right to pledge or exchange the assets without any significant constraints, and PFL has not entered into a repurchase agreement, does not hold unconditional call options and has not written put options on the transferred assets. In assessing whether control has been surrendered, PFL considers whether the transferee would be a consolidated affiliate and the impact of all arrangements or agreements made contemporaneously with, or in contemplation of the transfer, even if they were not entered into at the time of transfer. PFL measures gain or loss on sale of financial assets as the net proceeds received on the sale less the carrying amount of the loans sold. The net proceeds of the sale represent the fair value of any assets obtained or liabilities incurred as part of the transaction, including, but not limited to Servicing Assets, retained securities, and recourse obligations. Fair Value Measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial instruments consist principally of Cash and Cash Equivalents, Restricted Cash, Borrower Loans, Loans Held for Sale, Servicing Assets, Loan Trailing Fee Liability, Accounts Receivable, Accounts Payable and Accrued Liabilities, Payable to Investors and Notes. The estimated fair values of Cash and Cash Equivalents, Restricted Cash, Accounts Receivable, Accounts Payable and Accrued Liabilities, and Payable to Investors approximate their carrying values because of their short term nature. The fair value hierarchy includes a three-level classification, which is based on whether the inputs to the valuation methodology used for measurement are observable: Level 1 — Quoted market prices in active markets for identical assets or liabilities. Level 2 — Inputs other than quoted prices included in Level 1 that are observable for the asset or liability either directly or indirectly. Level 3 — Unobservable inputs. When developing fair value measurements, PFL maximizes the use of observable inputs and minimizes the use of unobservable inputs. However, for certain instruments PFL must utilize unobservable inputs in determining fair value due to the lack of observable inputs in the market, which requires greater judgment in measuring fair value. In instances where there is limited or no observable market data, fair value measurements for assets and liabilities are determined using assumptions that management believes a market participant would use in pricing the asset or liability. As observable market prices are not available for the Borrower Loans, Loans Held for Sale, Notes, and Servicing Assets, or for similar assets and liabilities, PFL believes the Borrower Loans, Loans Held for Sale, Notes, and Servicing Assets should be considered Level 3 financial instruments. PFL primarily uses a discounted cash flow model to estimate their fair value and key assumptions used in valuation include default rates and prepayment rates derived from historical performance and discount rates based on estimates of the rates of return that investors would require when investing in financial instruments with similar characteristics. The obligation to pay principal and interest on any series of Notes is equal to the loan payments, if any, that are received on the corresponding Borrower Loan, net of our servicing fee which is generally 1.0% of the outstanding balance. The fair value election for Notes and Borrower Loans allows both the assets and the related liabilities to receive similar accounting treatment for expected losses which is consistent with the subsequent cash flows to investors that are dependent upon borrower payments. As such, the fair value of a series of Notes is approximately equal to the fair value of the corresponding Borrower Loan, adjusted for the 1.0% servicing fee and the timing of loan purchase, Note issuance and borrower payments. As a result, the valuation of the Notes uses the same methodology and assumptions as the Borrower Loans, except that the Notes incorporate the 1.0% servicing fee and any differences in timing in payments. Any unrealized gains or losses on the Borrower Loans and Notes for which the fair value option has been elected is recorded as a separate line item in the statement of operations. The effective interest rate associated with a group of Notes is less than the interest rate earned on the corresponding Borrower Loan due to the 1.0% servicing fee. Refer to Note 8 for addition al fair value disclosures. Cash and Cash Equivalents Cash includes various unrestricted deposits with highly rated financial institutions. Cash equivalents consist of highly liquid marketable securities with original maturities of three months or less at the time of purchase and consist primarily of money market funds, commercial paper, U.S. treasury securities and U.S. agency securities. Cash equivalents are recorded at cost, which approximates fair value. Restricted Cash Restricted Cash consists primarily of cash deposits, money market funds and short-term certificate of deposit accounts held as collateral as required for long term leases, loan funding and servicing activities, and cash that investors have on our marketplace that has not yet been invested in Borrower Loans or disbursed to the investor. Borrower Loans, Loans Held for Sale and Notes With respect to the Note Channel, PFL purchases Borrower Loans from WebBank, then issues Notes and holds the Borrower Loans until maturity. The obligation to repay a series of Notes funded through the Note Channel is dependent upon the repayment of the associated Borrower Loan. Borrower Loans and Notes funded through the Note Channel are carried on PFL’s consolidated balance sheets as assets and liabilities, respectively. PFL places Borrower Loans and Loans Held for Sale on non-accrual status when they are 120 days past due. When a loan is placed on non-accrual status, PFL stops accruing interest and reverses all accrued but unpaid interest as of such date. Additionally, PFL charges-off Borrower Loans and Loans Held for Sale when they are 120 days past due. The fair value of loans 120 days past due generally consists of the expected recovery from debt sales in subsequent periods. Management has elected the fair value option for Borrower Loans, Loans Held for Sale, and Notes. Changes in fair value of Borrower Loans are largely offset by the changes in fair value of Notes due to the borrower payment-dependent design of the Notes. Changes in fair value of Borrower Loans, Loans Held for Sale and Notes are included in “Change in Fair Value of Financial Instruments, Net” on the Consolidated Statements of Operations. PFL primarily uses a discounted cash flow model to estimate the fair value of Borrower Loans, Loans Held for Sale and Notes. The key assumptions used in the valuation include default rates and prepayment rates derived primarily from historical performance and discount rates based on estimates of the rates of return that investors would require when investing in financial instruments with similar characteristics. Servicing Assets PFL records Servicing Assets at their estimated fair values for servicing rights retained when PFL sells Borrower Loans to unrelated third-party buyers. The change in fair value of Servicing Assets is recognized in revenue as Servicing Fees, Net. The gain or loss on a loan sale is recorded in Loss (Gain) on Sale of Borrower Loans while the fair value of the servicing rights, which is based on the degree to which the contractual loan servicing fee is above or below an estimated market loan servicing rate, is recorded in Servicing Assets on the Consolidated Balance Sheets. PFL uses a discounted cash flow model to estimate the fair value of Servicing Assets which considers the contractual servicing fee revenue that PFL earns on the Borrower Loans, estimated market servicing fees to service such loans, prepayment rates, default rates and the current principal balances of the Borrower Loans. Software and Website Development Software and website development represents the software and website development costs that PMI transferred to PFL. PFL does not develop any of its own software or its website. Software and website development are included in Property and Equipment, Net and amortized to expense using the straight-line method over their expected lives which is generally one Payable to Investors Payable to Investors primarily represents the Company's obligation to investors related to cash held in an account for the benefit of investors and payments-in-process received from borrowers. Loan Trailing Fee Liability On July 1, 2016, PMI signed a series of agreements with WebBank which, among other things, includes an additional program fee (the “Loan Trailing Fee”) paid to WebBank in connection with the performance of each loan sold to PMI. These agreements were effective as of August 1, 2016. The Loan Trailing Fee is dependent on the amount and timing of principal and interest payments made by borrowers of the underlying loans, irrespective of whether the loans are sold by PMI, and gives WebBank an ongoing financial interest in the performance of the loans it originates. This fee is paid by PMI to WebBank over the term of the respective loans and is a function of the principal and interest payments made by borrowers of such loans. In the event that principal and interest payments are not made with respect to any loan, PMI is not required to make the related Loan Trailing Fee payment. The obligation to pay the Loan Trailing Fee for any loan sold to PMI is recorded at fair value at the time of the origination of such loan within Other Liabilities and recorded as a reduction of “Transaction Fees, net”. Any changes in the fair value of this liability are recorded in “Servicing Fees, Net” on the Consolidated Statements of Operations. The fair value of the Loan Trailing Fee represents the present value of the expected monthly Loan Trailing Fee payments, which takes into consideration certain assumptions related to expected prepayment rates and defaults rates. Revenue Recognition Revenue primarily results from fees, net interest earned and gains on the sale of Borrower Loans. Fees consist of related party administrative fees and Servicing Fees paid by investors. The Company also has other smaller sources of revenue reported as Other Revenues including fees charged in relation to securitizations by outside investors. Administration Agreement License Fees PFL primarily generates revenues through license fees it earns through an Administration Agreement with PMI. The Administration Agreement contains a license granted by PFL to PMI that entitles PMI to use the platform for and in relation to: (i) PMI’s performance of its duties and obligations under the Administration Agreement relating to corporate administration, loan platform services, loan and Note servicing and marketing, and (ii) PMI’s performance of its duties and obligations to WebBank in relation to loan origination and funding. The license fees are based on the number of listings that are posted to the platform. Servicing Fees Investors who purchase Borrower Loans from PFL through the Whole Loan Channel typically pay PFL a servicing fee which is currently set at 1.0% per annum of the outstanding principal balance of the Borrower Loan prior to applying the current payment , plus an additional 0.075% per annum to cover the Loan Trailing Fee . The servicing fee com pensates PFL for the costs incurred in servicing the Borrower Loan, including managing payments from borrowers, managing payments to investors and maintaining investors’ account portfolios. PFL records Servicing Fees from investors as a component of operating revenue when received. Loss (Gain) on Sale of Borrower Loans PFL recognizes gains or losses on the sale of Borrower Loans when it sells Borrower Loans to third parties. PFL measures gain or loss on sale of Borrower Loans as the net proceeds received on the sale less the fair value of the Borrower Loans sold. The net proceeds of the sale represent the fair value of any assets obtained or liabilities incurred as part of the transaction, including, but not limited to Servicing Assets, retained securities, and repurchase obligations. Interest Income on Borrower Loans and Interest Expense on Notes PFL recognizes interest income on Borrower Loans originated through the Note Channel and interest expense on the corresponding Notes using the accrual method based on the stated interest rate to the extent PFL believes it to be collectable. Administration Fee Expense - Related Party Pursuant to the Administration Agreement between PFL and PMI, PMI manages the marketplace on behalf of PFL. Accordingly each month, PFL is required to pay PMI an administration fee that is based on PMI’s (a) finance and legal personnel costs, (b) number of Borrower Loans originated through the Marketplace, (c) Servicing Fees collected by or on behalf of PFL, and (d) nonsufficient funds fees collected by or on behalf of PFL. Recent Accounting Pronouncements Accounting Standards Adopted in the Current Period No accounting standards were adopted in the current period for PFL. Accounting Standards Issued, to be Adopted in Future Periods No issued and pending accounting standards were identified that are expected to have an impact on PFL. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
PROPERTY AND EQUIPMENT, NET | PROPERTY AND EQUIPMENT, NET Property and Equipment, Net consists of the following at the dates presented (in thousands): December 31, 2023 2022 Internal-use software and website development costs $ 58,423 $ 49,818 Operating lease right-of-use assets 22,655 27,051 Computer equipment 10,466 13,444 Office equipment and furniture 2,936 2,810 Leasehold improvements 6,827 7,157 Assets not yet placed in service 9,953 5,877 Property and equipment 111,260 106,157 Less: Accumulated depreciation and amortization (70,371) (67,343) Total Property and Equipment, Net $ 40,889 $ 38,814 Depreciation and amortization expense for Property and Equipment for the years ended December 31, 2023, 2022 and 2021 was $10.9 million, $10.8 million and $9.7 million, respectively. Prosper capitalized internal-use software and website development costs in the amount of $14.9 million , $11.0 million and $9.8 million for the years ended December 31, 2023, 2022 and 2021, respectively. Additionally, disclosures around the operating lease right-of-use assets are included in Note 16 . |
Prosper Funding LLC | |
Entity Information [Line Items] | |
PROPERTY AND EQUIPMENT, NET | PROPERTY AND EQUIPMENT, NET Property and Equipment consist of the following as of the dates presented (in thousands): December 31, 2023 2022 Internal-use software and web site development costs $ 43,619 $ 37,428 Less: Accumulated depreciation and amortization (31,978) (27,424) Total Property and Equipment, Net $ 11,641 $ 10,004 Depreciation and amortization expense for the years ended December 31, 2023, 2022, and 2021 was $6.3 million, $5.5 million and $4.9 million, respectively. Internal-use software and web site development additions of $7.9 million, |
BORROWER LOANS, LOANS HELD FOR
BORROWER LOANS, LOANS HELD FOR SALE AND NOTES, AT FAIR VALUE | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
BORROWER LOANS, LOANS HELD FOR SALE AND NOTES, AT FAIR VALUE | BORROWER LOANS, LOANS HELD FOR SALE AND NOTES, AT FAIR VALUE The fair value of the Borrower Loans originated and Notes issued through the Note Channel is estimated using discounted cash flow methodologies based upon a set of valuation assumptions. The primary assumptions used to value such Borrower Loans and Notes include default rates, prepayment rates and recoveries derived from historical performance and discount rates applied to each credit grade based on the perceived credit risk of each credit grade. The obligation to pay principal and interest on any series of notes is equal to the payments, if any, received on the corresponding borrower loan, net of the servicing fee. As such, the fair value of the Notes is approximately equal to the fair value of the Borrower Loans originated through the Note Channel, adjusted for the servicing fee and the timing of borrower payments subsequently disbursed to the note holders. The effective interest rate associated with any series of notes will be less than the interest rate earned on the corresponding borrower loan due to the servicing fee. The fair value of Borrower Loans is estimated using discounted cash flow methodologies based upon a set of valuation assumptions. The primary assumptions used to value such borrower loans include default and prepayment rates derived from historical performance and discount rates based on the rates of return that investors would require when investing in financial instruments with similar characteristics. Prosper Warehouse I Trust (“PWIT”) and Prosper Warehouse II Trust (“PWIIT”), consolidated VIEs, purchased Loans Held for Sale (collectively “Warehouse Loans”) from the Company through warehouse arrangements with national banking associations and asset managers. The PWIIT Warehouse Line was terminated on September 25, 2023. See Note 11 - Debt for more details. Prosper utilizes Warehouse Lines to finance Loans Held for Sale that may be subsequently contributed to securitization transactions or sold to investors. The fair value of the Loans Held for Sale is estimated using the same methodology used to value Borrower Loans. As of December 31, 2023 and 2022, Borrower Loans, Loans Held for Sale and Notes were as follows (in thousands): Borrower Loans Loans Held for Sale Notes 2023 2022 2023 2022 2023 2022 Aggregate principal balance outstanding $ 577,029 $ 333,294 $ 170,925 $ 512,076 $ 345,341 $ 336,555 Fair value adjustments (31,991) (12,652) (9,424) (12,311) (23,375) (17,851) Fair value $ 545,038 $ 320,642 $ 161,501 $ 499,765 $ 321,966 $ 318,704 Borrower Loans As of December 31, 2023, outstanding Borrower Loans had original terms to maturity of 24, 36, 48 or 60 months, had monthly payments with fixed interest rates ranging fro m 5.46% to 33.00% a nd had various original maturity dates through December 2028 . At December 31, 2022, outstanding Borrower Loans had original terms to maturity of 24, 36, 48 or 60 months, had monthly payments with fixed interest rates ranging from 5.31% to 33.00% and had various original maturity dates through December 2027. As of December 31, 2023, the Borrower Loans that were 90 days or more delinquent had an aggregate principal amount of $7.0 million and a fair value of $1.3 million. As of December 31, 2022, the Borrower Loans that were 90 days or more delinquent had an aggregate principal amount of $2.7 million and a fair value of $0.3 million. We place loans on non-accrual status when they are over 120 days past due. As of December 31, 2023 and 2022, Borrower Loans in non-accrual status had a fair value of $1.0 million and $0.3 million, respectively. Loans Held for Sale As of December 31, 2023, outstanding Loans Held for Sale had original terms to maturity of 24, 36, 48 or 60 months, had monthly payments with fixed interest rates ranging fro m 6.00% to 33.00% a nd had various original maturity dates through July 2028. At December 31, 2022, outstanding Loans Held for Sale had original terms to maturity of 24, 36, 48 or 60 months, had monthly payments with fixed interest rates rangin g from 5.31% to 33% and had various original maturity dates through December 2027. The Company earned i nterest income earned on Loans Held for Sale of $53.7 million and $41.0 million for the years ending December 31, 2023 and 2022, respectively. As of December 31, 2023, Loans Held for S ale that were 90 days or more delinquent, had an aggregate principal amo un t of $2.1 million and a fair value of $0.5 million. As of December 31, 2022, Loans Held for S ale that were 90 days or more delinquent, had an aggregate principal amount of $2.1 million and a fair value of $0.2 million . PMI places loans on non-accrual status when they are over 120 days past due. As of December 31, 2023 and December 31, 2022, Loans Held for Sale in non-accrual status had a fair value of $0.2 million and $0.2 million, respectively. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
BORROWER LOANS, LOANS HELD FOR SALE AND NOTES, AT FAIR VALUE | BORROWER LOANS AND NOTES, AT FAIR VALUE The fair value of Borrower Loans and Notes issued through the Note Channel is estimated using discounted cash flow methodologies based upon a set of valuation assumptions. The primary assumptions used to value such Borrower Loans and Notes include default and prepayment rates derived from historical performance and discount rates that reflect estimates of the rates of return that investors would require when investing in financial instruments with similar characteristics. The obligation to pay principal and interest on any series of Notes is equal to the payments, if any, received on the corresponding borrower loan, net of the servicing fee. As such, the fair value of Notes is approximately equal to the fair value of Borrower Loans originated through the Note Channel, adjusted for the servicing fee and the timing of borrower payments subsequently disbursed to the note holders. The effective interest rate associated with a series of notes will be less than the interest rate earned on the corresponding borrower loan due to the servicing fee. The aggregate principal balances outstanding and fair values of Borrower Loans and Notes as of December 31, 2023 and 2022, are presented in the following table (in thousands): Borrower Loans Notes December 31, 2023 December 31, 2022 December 31, 2023 December 31, 2022 Aggregate principal balance outstanding $ 342,791 $ 333,294 $ 345,341 $ 336,555 Fair value adjustments (18,480) (12,652) (23,375) (17,851) Fair value $ 324,311 $ 320,642 $ 321,966 $ 318,704 As of December 31, 2023, outstanding Borrower Loans had original terms to maturity of 24, 36, 48 or 60 months, had monthly payments with fixed interest rates ranging fro m 5.46% to 33.00% and had various original maturity dates through December 2028. At December 31, 2022, Borrower Loa ns had original maturities of 24, 36, 48 or 60 months , had monthly payments with fixed interest rates ranging from 5.31% to 33.00% and had various original maturity dates through December 2027. As of December 31, 2023, B orrower Loans that were 90 days or more delinquent had an aggregate principal amount of $4.5 million and a fair value of $0.9 million. A s of December 31, 2022, Borrower Loans that were 90 days or more delinquent had an aggregate principal amount of $2.7 million and a fair value of $0.3 million. PFL places loans on non-accrual status when they are over 120 days past due. As of December 31, 2023 and 2022, Borrower Loans i n non-accrual status had a fair value of $0.8 million and $0.3 million, respectively. On September 25, 2023, Prosper completed the PMIT 2023-1 Transaction, a securitization of Borrower Loans originated through Prosper’s marketplace platform. PFL served as the sole sponsor for this securitization. Loans eligible for securitization that were funded through the PWIIT Warehouse Line were contributed to the PMIT 2023-1 Transaction. Loans that were not eligible for securitization, with an aggregate outstanding principal balance of $7.7 million and a fair value of $2.0 million, were contributed to PFL, and are included in “Borrower Loans, at Fair Value” on the accompanying consolidated balance sheet. The fair value of these Borrower Loans was recorded as a deemed Contribution of Borrower Loans from Parent on the consolidated Statements of Member’s Equity and as a non-cash financing activity on the consolidated Statement of Cash Flows. |
CREDIT CARD
CREDIT CARD | 12 Months Ended |
Dec. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
CREDIT CARD | CREDIT CARD Prosper recognizes gains and losses on the Credit Card Derivative within Change in Fair Value of Financial Instruments on the accompanying Consolidated Statement of Operations. For the years ended December 31, 2023 and 2022 the Company recognize d $26.1 million and $9.8 million , respectively of unrealized gains from fair value changes on the Credit Card Derivative. Changes from settled transactions underlying the Credit Card Derivative , including income from debt sales on charged off balances, were a loss of $0.6 million and a gain of $4.3 million for the years ended December 31, 2023 and 2022 , respectively. These unrealized and settled gains and losses are included in Changes in Fair Value of Financial Instruments on the accompanying Consolidated Statements of Operations. The Company records revenue from various fees generated from the Credit Card program, including interchange fees, annual fees and late fees, net of a portion of the interchange fees that must be remitted to Coastal. These fees are included in Transaction Fees, Net on the accompanying Consolidated Statement of Operations. For the years ended December 31, 2023 and 2022 these fees totaled $18.1 million and $7.0 million, respectively. Under the program agreement, Prosper is responsible for servicing the entire underlying Credit Card portfolio. Coastal pays the Company a 1% per annum servicing fee on the daily outstanding balance of receivables designated as Coastal Allocations. To the extent these servicing fees do not exceed the market servicing rate a market participant would require to service the entire Credit Card portfolio, the Company records a servicing obligation liability and measures it at fair value through the servicing period. The net balance of this servicing obligation liability is included in Other Liabilities on the accompanying consolidated financial statements. Changes in the fair value of the servicing obligation liability are recorded in Servicing Fees, Net on the accompanying Consolidated Statement of Operations, and totaled $6.0 million and $3.7 million for t he years ended December 31, 2023 and 2022, respectively. |
SERVICING ASSETS
SERVICING ASSETS | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
SERVICING ASSETS | SERVICING ASSETS Prosper accounts for Servicing Assets at their estimated fair values with changes in fair values recorded in Servicing Fees, Net on the accompanying Consolidated Statements of Operations. The initial asset or liability is recognized when Prosper sells Borrower Loans to unrelated third-party buyers through the Whole Loan Channel and the servicing rights are retained. The Servicing Assets are measured at fair value throughout the servicing period. The total gains and losses recognized on the sale of such Borrower Loans on the Consolidated Statement of Operations wer e a loss of $12.4 million, a loss of $1.0 million and a gain of $7.2 million for the years ended December 31, 2023, 2022 and 2021, respectively, and recorded in (Loss) Gain on Sale of Borrower Loans on the Consolidated Statements of Operations. As of December 31, 2023, Borrower Loans that were sold, but for which Prosper retained servicing rights, had a total outstanding principal balance o f $3.1 billion, original terms to maturity of 24, 36, 48 or 60 months, monthly payments with fixed interest rates ranging from 5.46% to 33.00%, and variou s original maturity dates through December 2028 . As of December 31, 2022, Borrower Loans that were sold, but for which Prosper retained servicing rights, had a total outstanding principal balance of $3.2 billion , original terms to maturity of 24, 36, 48 or 60, monthly payments with fixed interest rates ranging from 5.31% to 33.00%, and various original maturity dates through December 2027. Contractually-specified servicing fees and ancillary fees totaling $30.9 million , $28.9 million and $24.8 million are included on the Consolidated Statements of Operations in Servicing Fees, Net for the years ended December 31, 2023, 2022 and 2021, respectively. Fair Value Valuation Method Prosper uses a discounted cash flow valuation methodology generally consisting of developing an estimate of future cash flows that are expected to occur over the life of a financial instrument and then discounts those cash flows at a rate of return that results in the fair value amount. Significant unobservable inputs presented in the table within Note 8 below are those that Prosper considers significant to the estimated fair values of the Level 3 Servicing Assets. The following is a description of the significant unobservable inputs provided in the table. Market Servicing Rate Prosper estimates adequate market servicing rates that would fairly compensate a substitute servicer should one be required, which includes the profit that would be demanded in the marketplace. This rate is stated as a fixed percentage of outstanding principal balance on a per annum basis. With the assistance of a valuation specialist, Prosper estimates these market servicing rates based on observable market rates for other loan types in the industry and bids from subservicing providers, adjusted for the unique loan attributes that are present in the specific loans that Prosper sells and services and information from backup service providers. Discount Rate The discount rate is a rate of return used to discount future expected cash flows to arrive at a present value, which represents the fair value of the loan servicing rights. We use a range of discount rates for the Servicing Assets based on comparable observed valuations of similar assets and publicly available disclosures related to servicing valuations, with comparability adjustments made to account for differences with Prosper’s servicing assets. Default Rate The default rate presented in Note 8 is an annualized, average estimate considering all Borrower Loan categories (i.e., risk ratings and duration), and represents an aggregate of conditional default rate curves for each credit grade or Borrower Loan category. Each point on a particular Borrower Loan category’s curve represents the percentage of principal expected to default per period based on the term and age of the underlying Borrower Loans. The assumption regarding defaults directly reduces servicing revenues because the amount of servicing revenues received is based on the amount collected each period. Prepayment Rate The prepayment rate presented in Note 8 is an annualized, average estimate considering all Borrower Loan categories (i.e., risk ratings and duration), and represents an aggregate of conditional prepayment rate curves for each credit grade or Borrower Loan category. Each point on a particular Borrower Loan category’s curve represents the percentage of principal expected to prepay per period based on the term and age of the underlying Borrower Loans. Prepayments reduce servicing revenues as they shorten the period over which we expect to collect fees on the Borrower Loans, which is used to project future servicing revenues. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
SERVICING ASSETS | SERVICING ASSETS PFL accounts for Servicing Assets at their estimated fair values with changes in fair values recorded in Servicing Fees, Net on the Consolidated Statements of Operations. The initial asset is recognized when PFL sells Borrower Loans to unrelated third-party buyers through the Whole Loan Channel and the servicing rights are retained. The total recognized gains and losses on the sale of such Borrower Loans were a $11.3 million loss, a $1.7 million gain and a $8.5 million gain for the years ended December 31, 2023, 2022, and 2021, respectively. At December 31, 2023, Borrower Loans that were sold, but for which PFL retained servicing rights, had a total outstanding principal balance of $3.5 billion , original terms of 24, 36, 48 or 60 months , monthly payments with fixed interest rates rangi ng from 5.46% to 33.00% and various original maturity dates through December 2028. At December 31, 2022, Borrower Loans that were sold, but for wh ich PFL retained servicing rights, had a total outstanding principal balance of $3.7 billion, original terms of 24, 36, 48 or 60 months, monthly payments with fixed interest rates ranging from 5.31% to 33.00% and various original maturity dates through December 2027. Contractually-specified servicing fees and ancillary fees totaled $39.7 million, $33.8 million and $29.2 million for the years ended December 31, 2023, 2022, and 2021, respectively, and are included in Servicing Fees, Net on the Statement of Operations. Fair Value Valuation Method PFL uses a discounted cash flow valuation methodology generally consisting of developing an estimate of future cash flows that are expected to occur over the life of a financial instrument and then discounting those cash flows at a rate of return that results in the fair value amount. Significant unobservable inputs presented in the table within Note 7 are those that PFL considers significant to the estimated fair values of the Level 3 Servicing Assets. The following is a description of the significant unobservable inputs provided in the table. Market Servicing Rate PFL estimates adequate market servicing rates that would fairly compensate a substitute servicer should one be required, which includes the profit that would be demanded in the marketplace. This rate is stated as a fixed percentage of outstanding principal balance on a per annum basis. With the assistance of a valuation specialist, PFL estimates these market servicing rates based on observable market rates for other loan types in the industry and bids from sub-servicing providers, adjusted for the unique loan attributes that are present in the specific loans that PFL sells and services and information from backup service providers. Discount Rate The discount rate is a rate of return used to discount future expected cash flows to arrive at a present value, which represents the fair value of the loan servicing rights. Management used a range of discount rates for the Servicing Assets based on comparable observed valuations of similar assets and publicly available disclosures related to servicing valuations, with comparability adjustments made to account for differences with PFL’s Servicing Assets. Default Rate The default rate presented in Note 7 is an annualized, average estimate considering all Borrower Loan categories (i.e., risk ratings and duration), and represents an aggregate of conditional default rate curves for each credit grade or borrower loan category. Each point on a particular borrower loan category’s curve represents the percentage of principal expected to default per period based on the term and age of the underlying Borrower Loans. The assumption regarding defaults directly reduces servicing revenues because the amount of servicing revenues received is based on the amount collected each period. Prepayment Rate The prepayment rate presented in Note 7 is an annualized, average estimate considering all borrower loan categories (i.e., risk ratings and duration), and represents an aggregate of conditional prepayment rate curves for each credit grade or borrower loan category. Each point on a particular borrower loan category’s curve represents the percentage of principal expected to prepay per period based on the term and age of the underlying Borrower Loans. Prepayments reduce servicing revenues as they shorten the period over which PFL expects to collect fees on the Borrower Loans, which is used to project future servicing revenues. |
SECURITIZATIONS
SECURITIZATIONS | 12 Months Ended |
Dec. 31, 2023 | |
Transfers and Servicing [Abstract] | |
SECURITIZATIONS | SECURITIZATIONS In September 2023, Prosper closed the PMIT 2023-1 Transaction, a securitization of unsecured personal whole loans that were previously originated through Prosper’s marketplace platform. Based on the terms of the underlying agreements, the PWIIT Warehouse Line (see Note 11, Debt ) agreed to contribute Borrower Loans with an aggregate outstanding principal balance of $275.9 million as of the established cutoff date of August 31, 2023, to the PMIT 2023-1 Transaction. On September 25, 2023, these Borrower Loans with an updated aggregate outstanding principal balance of approximately $266.1 million were contributed to the PMIT 2023-1 Transaction. PMIT 2023-1 issued notes and residual certificates to finance the purchase of the Borrower Loans. The notes were sold to third-party investors, and the residual certificates were acquired by PMI, as a majority-owned affiliate of the sole sponsor of the PMIT 2023-1 Transaction, PFL. In addition to the residual certificates, Prosper’s continued involvement includes loan servicing responsibilities over the life of the underlying loans. PMIT 2023-1 is deemed a VIE, and the Company consolidates it as the primary beneficiary. Through Prosper’s role as the servicer, it has the power to direct the activities that most significantly affect the PMIT 2023-1 Transaction’s economic performance. Additionally, because the Company holds the residual certificates, it has a variable interest that could potentially be significant to PMIT 2023-1. In evaluating whether Prosper is the primary beneficiary, management considers both qualitative and quantitative factors regarding the nature, size and form of our involvement with PMIT 2023-1. Management assesses whether Prosper is the primary beneficiary of the VIE on an on-going basis. For PMIT 2023-1, the creditors have no recourse to the general credit of Prosper and the liabilities of the securitization trust can only be settled by PMIT 2023-1’s assets. Additionally, the assets of PMIT 2023-1 can be used only to settle obligations of PMIT 2023-1. Because Prosper consolidates the securitization trust, the Borrower Loans held in the securitization trust are included in “Borrower Loans, at Fair Value,” and the notes sold to third-party investors are presented in “Notes Issued by Securitization Trust” on the consolidated balance sheets. Because Prosper holds 100% of the residual certificates issued by PMIT 2023-1, they eliminate through consolidation and are thus not presented on the consolidated balance sheets. The notes under PMIT 2023-1 were issued in five classes: Class A in the amount of $165.5 million, Class B in the amount of $25.4 million, Class C in the amount of $25.1 million, Class D in the amount of $22.3 million and Class E in the amount of $13.1 million (collectively, the “2023-1 Notes”). The Class A, Class B, Class C, Class D and Class E notes bear interest at fixed rates of 7.06%, 7.48%, 8.29%, 11.24% and 15.49%, respectively. Principal and interest payments began in October 2023 and are payable monthly. These notes are recorded at amortized cost, net of original issue discounts totaling approximately $0.8 million. These discounts, along with debt issuance costs incurred of $2.7 million, are deferred and amortized into interest expense over the contractual lives of the notes using the effective interest method. The notes held by third-party investors, along with unamortized original issue discounts and debt issuance costs, are aggregated and presented as “Notes Issued by Securitization Trust” on the consolidated balance sheet. As of December 31, 2023, the outstanding principal and accrued interest of these notes was $217.5 million , secured by an aggregate outstanding principal balance of $232.0 million of borrower loans included in Borrower Loans, at Fair Value on the Consolidated Balance Sheets, and approximately $12.6 million in cash collections held in collateral and reserve accounts included in Restricted Cash on the consolidated balance sheets. |
FAIR VALUE OF ASSETS AND LIABIL
FAIR VALUE OF ASSETS AND LIABILITIES | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
FAIR VALUE OF ASSETS AND LIABILITIES | FAIR VALUE OF ASSETS AND LIABILITIES For a description of the fair value hierarchy and Prosper’s fair value methodologies, see Note 2 - Summary of Significant Accounting Policies. Prosper did not transfer any assets or liabilities in or out of Level 3 during the year ended December 31, 2023 or 2022. Financial Instruments Recorded at Fair Value The fair value of the Borrower Loans, Loans Held for Sale, Notes, Servicing Assets and Liabilities and loan trailing fee liability are estimated using discounted cash flow methodologies based upon a set of valuation assumptions. The primary assumptions used in the discounted cash flow model include default and prepayment rates primarily derived from historical performance and discount rates applied to each credit grade based on the perceived credit risk of each credit grade. The fair value of the Credit Card Derivative is also estimated using a discounted cash flow model using certain assumptions. The key assumptions used in the valuation include default and prepayment rates derived primarily from historical performance and relevant market data, adjusted as necessary based on the perceived credit risk of the underlying portfolio. In addition, discount rates based on estimates of the rates of return that investors would require when investing in similar credit card portfolios are applied to the individual freestanding derivatives. When utilizing market data and bid-ask spreads, Prosper uses the price within the bid-ask spread that best represents fair value. When quoted prices do not exist, Prosper uses prices obtained from independent third-party pricing services to measure the fair value of financial instruments. Prosper's primary independent pricing service provides prices based on observable trades and discounted cash flows that incorporate observable information, such as yields for similar types of securities (a benchmark interest rate plus observable spreads) and weighted-average maturity for the same or similar securities. The Company does not adjust the prices received from independent third-party pricing services unless such prices are inconsistent with the definition of fair value and result in a material difference in the recorded amounts. The Convertible Preferred Stock Warrant Liability is valued using a Black-Scholes option pricing model. Refer to Note 13 for additional information. The following tables present the fair value hierarchy for assets and liabilities measured at fair value (in thousands): Balance at December 31, 2023 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans, at Fair Value $ — $ — $ 545,038 $ 545,038 Loans Held for Sale, at Fair Value — — 161,501 161,501 SOFR rate swaption (Note 11) — 90 — 90 Servicing Assets — — 12,249 12,249 Credit Card Derivative (Note 5) — — 36,848 36,848 Total Assets $ — $ 90 $ 755,636 $ 755,726 Liabilities: Notes, at Fair Value $ — $ — $ 321,966 $ 321,966 Convertible Preferred Stock Warrant Liability — — 215,041 215,041 Loan Trailing Fee Liability (Note 10) — — 2,942 2,942 Credit Card servicing obligation liability (Note 5) — — 9,732 9,732 Total Liabilities $ — $ — $ 549,681 $ 549,681 Balance at December 31, 2022 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans, at Fair Value $ — $ — $ 320,642 $ 320,642 Loans Held for Sale, at Fair Value — — 499,765 499,765 LIBOR rate swaption — 1,289 — 1,289 Servicing Assets — — 12,562 12,562 Credit Card Derivative (Note 5) — — 10,782 10,782 Total Assets $ — $ 1,289 $ 843,751 $ 845,040 Liabilities: Notes, at Fair Value $ — $ — $ 318,704 $ 318,704 Convertible Preferred Stock Warrant Liability — — 166,346 166,346 Loan Trailing Fee Liability (Note 10) — — 3,290 3,290 Credit Card servicing obligation liability (Note 5) — — 3,720 3,720 Total Liabilities $ — $ — $ 492,060 $ 492,060 As PMI’s Borrower Loans, Loans Held for Sale, Notes, Convertible Preferred Stock Warrant Liability, Servicing Assets and Liability, Credit Card Derivative and loan trailing fee liability do not trade in an active market with readily observable prices, the Company uses significant unobservable inputs to measure the fair value of these assets and liabilities. Financial instruments are categorized in the Level 3 valuation hierarchy based on the significance of unobservable factors in the overall fair value measurement. These fair value estimates may also include observable, actively quoted components derived from external sources. As a result, gains and losses for assets and liabilities within the Level 3 category may include changes in fair value that were attributable to both observable and unobservable inputs. Prosper did not transfer any assets or liabilities in or out of Level 3 for the year ended December 31, 2023 and 2022. Significant Unobservable Inputs The following tables present quantitative information about the ranges of significant unobservable inputs used for the Company’s Level 3 fair value measurements at December 31, 2023 and 2022: December 31, 2023 2022 Borrower Loans, Loans Held for Sale, and Notes: Discount rate 5.4 % — 8.1 % 5.4 % — 13.2 % Default rate 3.2 % — 23.6 % 1.8 % — 18.7 % At December 31, 2023 and 2022, the discounted cash flow methodology used to estimate the Note fair values used the same projected cash flows as the related Borrower Loans. December 31, 2023 2022 Servicing Assets: Discount rate 15.0 % — 25.0 % 15.0 % — 25.0 % Default rate 2.8 % — 23.6 % 2.0 % — 19.3 % Prepayment rate 6.1 % — 30.6 % 14.2 % — 28.0 % Market servicing rate (1) (2) 0.633 % — 0.842 % 0.648 % — 0.842 % (1) Servicing assets associated with loans enrolled in a relief program offered by the Company as of December 31, 2023 were measured using a market servicing rate assumption of 84.2 basis points. This rate was estimated using a multiplier consistent with observable market rates for other loan types, applied to the base market servicing rate assumption. (2) Excludes collection fees that would be passed on to a hypothetical third-party servicer. As of December 31, 2023 and 2022, the market rate for collection fees and non-sufficient fund fees was assum ed to be 5 basis po ints and 6 basis points, respectively, for a weighted-average total market servicing rate of 68.3 basis points to 89.2 basis points and 70.8 basis points to 90.2 basis points, respectively. December 31, 2023 2022 Loan Trailing Fee Liability: Discount rate 15.0 % — 25.0 % 15.0 % — 25.0 % Default rate 2.8 % — 23.6 % 2.0 % — 19.3 % Prepayment rate 6.1 % — 30.6 % 14.2 % — 28.0 % Ranges of inputs are not applied to the Credit Card Derivative and Credit Card servicing obligation liability, as they are valued at the portfolio level. Refer below for a summary of the significant unobservable inputs associated with those Level 3 fair value measurements. Changes in Level 3 Fair Value Assets and Liabilities on a Recurring Basis The following table presents additional information about Level 3 Borrower Loans, Loans Held for Sale and Notes measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in thousands): Assets Liabilities Borrower Loans Held Notes Total Fair Value at January 1, 2022 $ 267,626 $ 243,170 $ (265,985) $ 244,811 Purchase of Borrower Loans/Issuance of Notes 284,921 3,063,729 (285,115) 3,063,535 Principal repayments (187,599) (184,090) 202,308 (169,381) Borrower Loans sold to third parties (14,520) (2,599,881) — (2,614,401) Other changes 650 1,804 (742) 1,712 Change in fair value (30,436) (24,967) 30,830 (24,573) Fair Value at December 31, 2022 $ 320,642 $ 499,765 (318,704) 501,703 Purchase of Borrower Loans/Issuance of Notes 232,306 1,921,129 (231,520) 1,921,915 Principal repayments (217,485) (214,880) 188,670 (243,695) Borrower Loans sold to third parties (4,595) (1,743,287) — (1,747,882) Other changes 2,906 (2,306) (815) (215) Change in fair value (48,387) (39,269) 40,403 (47,253) Transfer of Loans Held for Sale to Borrower Loans upon PMIT 2023-1 Transaction, at Fair Value 259,651 (259,651) — — Fair Value at December 31, 2023 $ 545,038 $ 161,501 $ (321,966) $ 384,573 The following table presents additional information about the Level 3 Servicing Assets measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in thousands): Servicing Assets Fair Value at January 1, 2022 $ 8,761 Additions 12,957 Less: Change in fair value (9,156) Fair Value at December 31, 2022 $ 12,562 Additions 9,238 Less: Change in fair value (9,551) Fair Value at December 31, 2023 $ 12,249 The following table presents additional information ab out the Level 3 Credit Card Derivative measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in tho usands): Credit Card Derivative Fair Value at January 1, 2022 $ 7 Change in fair value 9,784 Net gains from settled transactions 4,295 Less: Net payments made (3,304) Fair Value at December 31, 2022 $ 10,782 Change in fair value 26,066 Net losses from settled transactions (561) Less: Net payments made 561 Fair Value at December 31, 2023 $ 36,848 The following table presents additional information ab out the Level 3 Credit Card servicing obligation liability measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in tho usands). Credit Card Servicing Obligation Liability Fair Value at January 1, 2022 $ — Change in fair value 3,720 Fair Value at December 31, 2022 $ 3,720 Change in fair value 6,012 Fair Value at December 31, 2023 $ 9,732 The following table presents additional information about the Level 3 Convertible Preferred Stock Warrant Liability measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in thousands): Convertible Preferred Stock Warrant Liability Fair Value at January 1, 2022 $ 250,941 Change in fair value (84,595) Fair Value at December 31, 2022 $ 166,346 Change in fair value 48,695 Fair Value at December 31, 2023 $ 215,041 Loan Trailing Fee The fair value of the Loan Trailing Fee represents the present value of the expected monthly Loan Trailing Fee payments, which takes into consideration certain assumptions related to expected prepayment rates and default rates using a discounted cash flow model. The assumptions used are the same as those used for the valuation of Servicing Assets, as described below. The following table presents additional information about Level 3 Loan Trailing Fee Liability measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in thousands): Loan Trailing Fee Liability Balance at January 1, 2022 $ 2,161 Issuances 3,070 Cash payment of Loan Trailing Fee (2,245) Change in fair value 304 Balance at December 31, 2022 $ 3,290 Issuances 2,011 Cash payment of Loan Trailing Fee (2,791) Change in fair value 432 Balance at December 31, 2023 $ 2,942 Significant Recurring Level 3 Fair Value Input Sensitivity Key economic assumptions and the sensitivity of the fair value to immediate changes in those assumptions at December 31, 2023 and 2022 for Borrower Loans and Loans Held for Sale are presented in the following table (in thousands, except percentages). Borrower Loans and Loans Held for Sale: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 706,539 $ 820,407 Weighted-average discount rate 6.88 % 6.72 % Weighted-average default rate 12.44 % 9.31 % Fair value resulting from: 100 basis point increase in discount rate $ 699,770 $ 812,061 200 basis point increase in discount rate $ 693,167 803,927 Fair value resulting from: 100 basis point decrease in discount rate $ 713,481 $ 828,975 200 basis point decrease in discount rate $ 720,601 837,773 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 696,510 $ 810,657 Applying a 1.2 multiplier to default rate $ 686,586 800,989 Fair value resulting from: Applying a 0.9 multiplier to default rate $ 716,671 $ 830,238 Applying a 0.8 multiplier to default rate $ 726,910 840,156 Key economic assumptions and the sensitivity of the fair value to immediate changes in those assumptions at December 31, 2023 and 2022 for Notes are presented in the following table (in thousands, except percentages). Notes: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 321,966 $ 318,704 Weighted-average discount rate 6.55 % 6.87 % Weighted-average default rate 14.21 % 11.36 % Fair value resulting from: 100 basis point increase in discount rate $ 318,877 $ 315,456 200 basis point increase in discount rate $ 315,863 312,291 Fair value resulting from: 100 basis point decrease in discount rate $ 325,134 $ 322,037 200 basis point decrease in discount rate $ 328,384 325,461 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 317,359 $ 314,892 Applying a 1.2 multiplier to default rate $ 312,800 311,112 Fair value resulting from: Applying a 0.9 multiplier to default rate $ 326,621 $ 322,547 Applying a 0.8 multiplier to default rate $ 331,325 326,425 Key economic assumptions and the sensitivity of the fair value to immediate changes in those assumptions at December 31, 2023 and 2022 for Servicing Assets is presented in the following table (in thousands, except percentages). Servicing Assets: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 12,249 $ 12,562 Weighted-average market servicing rate 0.65 % 0.65 % Weighted-average prepayment rate 19.55 % 18.47 % Weighted-average default rate 15.25 % 13.38 % Fair value resulting from: Market servicing rate increase of 0.025% $ 11,475 $ 11,708 Market servicing rate decrease of 0.025% $ 13,023 $ 13,415 Fair value resulting from: Applying a 1.1 multiplier to prepayment rate $ 11,969 $ 12,286 Applying a 0.9 multiplier to prepayment rate $ 12,533 $ 12,842 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 11,998 $ 12,305 Applying a 0.9 multiplier to default rate $ 12,503 $ 12,820 Key economic assumptions and the sensitivity of the fair value to immediate changes in those assumptions at December 31, 2023 and 2022 for the Credit Card Derivative is presented in the following table (in thousands, except percentages). Credit Card Derivative: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 36,848 $ 10,782 Prosper Credit Card portfolio $ 286,284 $ 113,917 Discount rate on Prosper Credit Card portfolio 23.19 % 26.23 % Discount rate on Coastal Program Fee 7.41 % 9.26 % Prepayment rate applied to Credit Card portfolio 8.14 % 10.08 % Default rate applied to Credit Card portfolio 14.36 % 13.34 % Fair value resulting from: 100 basis point increase in both discount rates $ 36,452 $ 10,699 200 basis point increase in both discount rates $ 36,065 $ 10,618 Fair value resulting from: 100 basis point decrease in both discount rates $ 37,253 $ 10,866 200 basis point decrease in both discount rates $ 37,668 $ 10,951 Fair value resulting from: Applying a 1.1 multiplier to prepayment rate $ 36,374 $ 10,625 Applying a 0.9 multiplier to prepayment rate $ 37,328 $ 10,942 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 29,659 $ 8,001 Applying a 0.9 multiplier to default rate $ 44,256 $ 13,641 Key economic assumptions and the sensitivity of the fair value to immediate changes in those assumptions at December 31, 2023 and 2022 for Credit Card servicing obligation liability is presented in the following table (in thousands, except percentages). Credit Card servicing obligation liability: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: 9,732 3,720 Discount rate on Credit Card portfolio servicing obligation 7.41 % 9.26 % Prepayment rate applied to Credit Card portfolio 8.14 % 10.08 % Default rate applied to Credit Card portfolio 14.36 % 13.34 % Market servicing rate 2.00 % 2.00 % Fair value resulting from: Market servicing rate increase of 0.10% $ 10,253 $ 3,919 Market servicing rate decrease of 0.10% $ 9,213 $ 3,521 Fair value resulting from: Applying a 1.1 multiplier to prepayment rate $ 9,609 $ 3,662 Applying a 0.9 multiplier to prepayment rate $ 9,858 $ 3,779 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 9,487 $ 3,636 Applying a 0.9 multiplier to default rate $ 9,984 $ 3,806 These sensitivities are hypothetical and should be evaluated with care. The effect on fair value of a variation in assumptions generally cannot be determined because the relationship of the change in assumptions to the fair value may not be linear. Additionally, the impact of a variation in a particular assumption on the fair value is calculated while holding other assumptions constant. In reality, changes in one factor may lead to changes in other factors, which could impact the above hypothetical effects. Assets and Liabilities Not Recorded at Fair Value The following tables present the fair value hierarchy for assets and liabilities not recorded at fair value (in thousands): Balance at December 31, 2023 Carrying Amount Level 1 Inputs Level 2 Inputs Level 3 Inputs Fair Value Assets: Cash and Cash Equivalents $ 34,970 $ 34,970 $ — $ — $ 34,970 Restricted Cash - Cash and Cash Equivalents 117,270 117,270 — — 117,270 Restricted Cash - Certificates of Deposit 3,028 — 3,028 — 3,028 Accounts Receivable 7,523 — 7,523 — 7,523 Total Assets $ 162,791 $ 152,240 $ 10,551 $ — $ 162,791 Liabilities: Accounts Payable and Accrued Liabilities $ 40,906 $ — $ 40,906 $ — $ 40,906 Payable to Investors 86,732 — 86,732 — 86,732 Notes Issued by Securitization Trust 214,798 — 208,005 — 208,005 Warehouse Lines 160,207 — 157,972 — 157,972 Term Loan (Note 11) 75,313 — 77,837 — 77,837 Total Liabilities $ 577,956 $ — $ 571,452 $ — $ 571,452 Balance at December 31, 2022 Carrying Amount Level 1 Inputs Level 2 Inputs Level 3 Inputs Fair Value Assets: Cash and Cash Equivalents $ 83,446 $ 83,446 $ — $ — $ 83,446 Restricted Cash - Cash and Cash Equivalents 108,284 108,284 — — 108,284 Restricted Cash - Certificates of Deposit 4,879 — 4,879 — 4,879 Accounts Receivable 3,462 — 3,462 — 3,462 Total Assets $ 200,071 $ 191,730 $ 8,341 $ — $ 200,071 Liabilities: Accounts Payable and Accrued Liabilities $ 37,254 $ — $ 37,254 $ — $ 37,254 Payable to Investors 85,312 — 85,312 — 85,312 Warehouse Lines 446,762 — 444,329 — 444,329 Paycheck Protection Program loan (Note 11) 73,407 — 76,191 — 76,191 Total Liabilities $ 642,735 $ — $ 643,086 $ — $ 643,086 The estimated fair values of Cash and Cash Equivalents, Restricted Cash, Accounts Receivable, Accounts Payable and Accrued Liabilities and Payable to Investors approximate their carrying values because of their short-term nature. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
FAIR VALUE OF ASSETS AND LIABILITIES | FAIR VALUE OF ASSETS AND LIABILITIES PFL has elected to record certain financial instruments at fair value on the balance sheet. PFL classifies Borrower Loans, Loans Held for Sale and Notes as financial instruments and assesses their fair value on a quarterly basis for financial statement presentation purposes. Gains and losses on these financial instruments are shown separately on the Consolidated Statements of Operations. As of December 31, 2023 and 2022, the discounted cash flow methodology used to estimate the Notes fair values used the same projected cash flows as the related Borrower Loans. As demonstrated in the table below, the fair value adjustments for Borrower Loans were largely offset by the fair value adjustments of the Notes due to the borrower payment dependent design of the Notes and because the principal balances of the Borrower Loans approximated the principal balances of the Notes. For a description of the fair value hierarchy and PFL’s fair value methodologies, see Note 2 - Summary of Significant Accounting Policies. PFL did not transfer any assets or liabilities in or out of Level 3 during the years ended December 31, 2023 and 2022. Financial Instruments Recorded at Fair Value The fair value of the Borrower Loans and Notes are estimated using discounted cash flow methodologies based upon a set of valuation assumptions. The primary cash flow assumptions used to value such Borrower Loans and Notes include default and prepayment rates derived primarily from historical performance and discount rates that reflect estimates of the rates of return that investors would require when investing in financial instruments with similar characteristics. The following tables present the fair value hierarchy for assets and liabilities measured at fair value (in thousands): December 31, 2023 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans, at Fair Value $ — $ — $ 324,311 $ 324,311 Servicing Assets — — 13,818 13,818 Total Assets $ — $ — $ 338,129 $ 338,129 Liabilities: Notes, at Fair Value $ — $ — $ 321,966 $ 321,966 Loan Trailing Fee Liability* — — 2,942 2,942 Total Liabilities $ — $ — $ 324,908 $ 324,908 December 31, 2022 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans, at Fair Value $ — $ — $ 320,642 $ 320,642 Servicing Assets — — 14,860 14,860 Total Assets $ — $ — $ 335,502 $ 335,502 Liabilities: Notes, at Fair Value $ — $ — $ 318,704 $ 318,704 Loan Trailing Fee Liability* — — 3,290 3,290 Total Liabilities $ — $ — $ 321,994 $ 321,994 *Included in Other Liabilities on the Consolidated Balance Sheets. As PFL’s Borrower Loans, Notes, Servicing Assets and loan trailing fee liability do not trade in an active market with readily observable prices, PFL uses significant unobservable inputs to measure the fair value of these assets and liabilities. Financial instruments are categorized in the Level 3 valuation hierarchy based on the significance of unobservable factors in the overall fair value measurement. These fair value estimates may also include observable, actively quoted components derived from external sources. As a result, the realized and unrealized gains and losses for assets and liabilities within the Level 3 category may include changes in fair value that were attributable to both observable and unobservable inputs. Significant Unobservable Inputs The following tables present quantitative information about the significant unobservable inputs used for PFL’s Level 3 fair value measurements at the dates presented: Range Borrower Loans and Notes: December 31, 2023 December 31, 2022 Discount rate 5.5 % — 8.0 % 5.6 % — 12.9 % Default rate 3.2 % — 23.6 % 1.8 % — 18.2 % Range Servicing Assets: December 31, 2023 December 31, 2022 Discount rate 15.0 % — 25.0 % 15.0 % — 25.0 % Default rate 2.8 % — 23.6 % 2.0 % — 19.3 % Prepayment rate 6.1 % — 30.6 % 14.2 % — 28.0 % Market servicing rate (1) (2) 0.633 % — 0.842 % 0.648 % — 0.842 % (1) Servicing assets associated with loans enrolled in a relief program offered by the Company as of December 31, 2023 and 2022 were measured using a market servicing rate assumption of 84.2 basis points. This rate was estimated using a multiplier consistent with observable market rates for other loan types, applied to the base market servicing rate assumption. (2) Excludes collection fees that would be passed on to a hypothetical third-party servicer. As of December 31, 2023 and 2022, the market rate for col lection fees and non-sufficient fund fees was assumed to be 5 basis points and 6 basis points, respectively, for a weighted-average total market servicing rate of 68.3 basis points to 89.2 basis points and 70.8 basis points to 90.2 basis points, respectively. Range Loan Trailing Fee Liability: December 31, 2023 December 31, 2022 Discount rate 15.0 % — 25.0 % 15.0 % — 25.0 % Default rate 2.8 % — 23.6 % 2.0 % — 19.3 % Prepayment rate 6.1 % — 30.6 % 14.2 % — 28.0 % Changes in Level 3 Fair Value Assets and Liabilities on a Recurring Basis The following table presents additional information about Level 3 Loans Held for Sale, Borrower Loans, and Notes measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in thousands): Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Assets Liabilities Borrower Loans Held Notes Total Fair value at January 1, 2022 $ 267,626 $ — $ (265,985) $ 1,641 Originations 284,921 3,063,729 (285,115) 3,063,535 Principal repayments (187,599) — 202,308 14,709 Borrower Loans sold to third parties (14,520) (3,063,729) — (3,078,249) Other changes 650 — (742) (92) Change in fair value (30,436) — 30,830 394 Fair value at December 31, 2022 $ 320,642 $ — $ (318,704) $ 1,938 Originations 232,306 1,921,129 (231,520) 1,921,915 Borrower Loans contributed by Parent, at Fair Value 2,010 — — 2,010 Principal repayments (186,433) — 188,670 2,237 Borrower Loans sold to third parties (4,646) (1,921,129) — (1,925,775) Other changes 717 — (815) (98) Change in fair value (40,285) — 40,403 118 Fair value at December 31, 2023 $ 324,311 $ — $ (321,966) $ 2,345 The following table presents additional information about Level 3 Servicing Assets recorded at fair value (in thousands): Servicing Assets Fair value at January 1, 2022 $ 9,796 Additions 15,277 Change in fair value (10,213) Fair value at December 31, 2022 $ 14,860 Additions 10,151 Change in fair value (11,193) Fair value at December 31, 2023 $ 13,818 Loan Trailing Fee Liability The fair value of the Loan Trailing Fee Liability represents the present value of the expected monthly Loan Trailing Fee payments, which takes into consideration certain assumptions related to expected prepayment rates and default rates using a discounted cash flow model. The assumptions used are the same as those used for the valuation of Servicing Assets, as described below. The following tables present additional information about Level 3 Loan Trailing Fee Liability measured at fair value on a recurring basis (in thousands): Loan Trailing Fee Liability Fair Value at January 1, 2022 $ 2,161 Issuances 3,070 Cash payment of Loan Trailing Fee (2,245) Change in fair value 304 Fair Value at December 31, 2022 $ 3,290 Issuances 2,011 Cash payment of Loan Trailing Fee (2,791) Change in fair value 432 Fair Value at December 31, 2023 $ 2,942 Significant Recurring Level 3 Fair Value Asset and Liability Input Sensitivity Key economic assumptions are used to compute the fair value of Borrower Loans and Notes. The sensitivity of the current fair value to immediate changes in assumptions at December 31, 2023 and 2022 for Borrower Loans are presented in the following table (in thousands, except percentages): Borrower Loans: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 324,311 $ 320,642 Weighted-average discount rate 6.55 % 6.87 % Weighted-average default rate 14.36 % 11.36 % Fair value resulting from: 100 basis point increase in discount rate $ 321,204 $ 317,380 200 basis point increase in discount rate $ 318,174 $ 314,201 Fair value resulting from: 100 basis point decrease in discount rate $ 327,498 $ 323,991 200 basis point decrease in discount rate $ 330,766 $ 327,429 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 319,708 $ 316,832 Applying a 1.2 multiplier to default rate $ 315,153 $ 313,053 Fair value resulting from: Applying a 0.9 multiplier to default rate $ 328,962 $ 324,484 Applying a 0.8 multiplier to default rate $ 333,662 $ 328,361 Key economic assumptions are used to compute the fair value of Notes. The sensitivity of the fair value to immediate changes in assumptions at December 31, 2023 and 2022 for Notes funded through the Note Channel are presented in the following table (in thousands, except percentages): Notes: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 321,966 $ 318,704 Weighted-average discount rate 6.55 % 6.87 % Weighted-average default rate 14.21 % 11.36 % Fair value resulting from: 100 basis point increase in discount rate $ 318,877 $ 315,456 200 basis point increase in discount rate $ 315,863 $ 312,291 Fair value resulting from: 100 basis point decrease in discount rate $ 325,134 $ 322,037 200 basis point decrease in discount rate $ 328,384 $ 325,461 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 317,359 $ 314,892 Applying a 1.2 multiplier to default rate $ 312,800 $ 311,112 Fair value resulting from: Applying a 0.9 multiplier to default rate $ 326,621 $ 322,547 Applying a 0.8 multiplier to default rate $ 331,325 $ 326,425 Key economic assumptions are used to compute the fair value of Servicing Assets. The sensitivity of the current fair value to immediate changes in assumptions at December 31, 2023 and 2022 for Servicing Assets are presented in the following table (in thousands, except percentages): Servicing Assets: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 13,818 $ 14,860 Weighted-average market servicing rate 0.650 % 0.649 % Weighted-average prepayment rate 19.96 % 18.77 % Weighted-average default rate 14.74 % 12.63 % Fair value resulting from: Market servicing rate increase of 0.025% $ 12,945 $ 13,850 Market servicing rate decrease of 0.025% $ 14,691 $ 15,870 Fair value resulting from: Applying a 1.1 multiplier to prepayment rate $ 13,502 $ 14,534 Applying a 0.9 multiplier to prepayment rate $ 14,139 $ 15,191 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 13,534 $ 14,557 Applying a 0.9 multiplier to default rate $ 14,104 $ 15,165 These sensitivities are hypothetical and should be evaluated with care. The effect on fair value of a 10% variation in assumptions generally cannot be determined because the relationship of the change in assumptions to the fair value may not be linear. Additionally, the impact of a variation in a particular assumption on the fair value is calculated while holding other assumptions constant. In reality, changes in one factor may lead to changes in other factors, which could impact the above hypothetical effects. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS, NET | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS, NET | GOODWILL AND OTHER INTANGIBLE ASSETS, NET Goodwill Prosper’s goodwi ll balance of $36.4 million at December 31, 2023 did not change during the year ended December 31, 2023. The Company recorded no goo dwill impairment for the years ended December 31, 2023, 2022 and 2021. Other Intangible Assets, Net The following table presents the detail of other Intangible Assets subject to amortization as of the following dates (dollars in thousands): December 31, 2023 Gross Carrying Value Accumulated Amortization Net Carrying Value Remaining Useful Life (In Years) Developed technology $ 3,060 $ (3,060) $ — — User base and customer relationships 5,050 (4,965) 85 1.3 Brand name 60 (60) — — Total Intangible Assets subject to amortization $ 8,170 $ (8,085) $ 85 December 31, 2022 Gross Carrying Value Accumulated Amortization Net Carrying Value Remaining Useful Life (In Years) Developed technology $ 3,060 $ (3,060) $ — — User base and customer relationships 5,050 (4,858) 192 2.3 Brand name 60 (60) — — Total Intangible Assets subject to amortization $ 8,170 $ (7,978) $ 192 The Company recorded no additional intangibles for the years ended December 31, 2023 and 2022. For the years ended December 31, 2023, 2022 and 2021, the Company reco rded no intangible asset impairment. Prosper’s intangible asset balance w as $0.1 million and $0.2 million at December 31, 2023 and 2022, respectively. The user base and customer relationships intangible assets are being amortized on an accelerated basis over a three Amortization expense for the years ended December 31, 2023, 2022 and 2021 was $0.1 million , $0.1 million and $0.2 million, respectively. Estimated amortization of purchased Intangible Assets for future periods is as follows (in thousands): Amounts Years Ending December 31, 2024 $ 85 Total Amortization Expenses $ 85 |
OTHER LIABILITIES
OTHER LIABILITIES | 12 Months Ended |
Dec. 31, 2023 | |
Other Liabilities [Abstract] | |
OTHER LIABILITIES | OTHER LIABILITIES Other Liabilities consists of the following (in thousands): December 31, 2023 2022 Operating lease liabilities (Note 16) $ 14,431 $ 16,351 Deferred revenue 6,373 3,880 Credit Card servicing obligation liability (Note 5) 9,732 3,720 Loan trailing fee liability 2,942 3,290 Deferred income tax liability 721 658 Other 1,060 359 Total Other Liabilities $ 35,259 $ 28,258 |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Term Loan Credit Agreement On November 14, 2022, the Company entered into a Credit Agreement with a third-party financial institution, which provides for a $75 million Term Loan maturing on November 14, 2026. Proceeds received from the Term Loan were net of an original issue discount and the Company also incurred approximately $0.4 million in debt issuance costs. Both the original issue discount and the debt issuance costs are being amortized over the life of the Term Loan to interest expense using the effective interest method. Interest Borrowings under the Term Loan accrue interest at the Secured Overnight Financing Rate (“SOFR”) plus 9.0% per annum. In addition, all borrowings under the Term Loan accrue payment-in-kind (“PIK”) interest at 2.0% per annum. Any accrued PIK interest that remains unpaid at the end of each month is added to the outstanding principal balance of the Term Loan. Guarantees and Collateral PMI’s obligations under the Term Loan are guaranteed by PHL and BillGuard. All obligations under the Credit Agreement are secured by a first priority, perfected lien on substantially all of the assets of PMI (subject to exclusions such as certain cash amounts and deposit accounts), PHL and BillGuard, as well as equity interests in all of PMI’s subsidiaries with the exception of PGT. Covenants and Other Matters The Credit Agreement contains a number of covenants that, among other things and subject to certain exceptions and thresholds, restrict PMI’s ability to incur certain new indebtedness; incur certain liens; sell or otherwise dispose of all or substantially all its assets; make loans, advances, and guarantees; and pay dividends or make other distributions on equity interests. In addition, the Credit Agreement contains certain financial covenants with which the Company must remain in compliance as of the last business day of each month during the life of the Term Loan: • a minimum tangible net worth • a minimum net liquidity • a maximum leverage ratio • a minimum asset coverage ratio The Company is in compliance with all covenants as of December 31, 2023, as well as applicable monthly periods for the year then ended. The Credit Agreement also contains certain customary representations and warranties and affirmative covenants, and certain reporting obligations. In addition, the Term Loan lender will be permitted to accelerate all outstanding borrowings and exercise other specified remedies upon the occurrence of certain events of default (subject to certain grace periods and exceptions), which include, among other things, payment defaults, breaches of representations and warranties, covenant defaults, certain cross-defaults to other indebtedness, certain events of bankruptcy and insolvency, certain judgments and changes of control. Prosper Warehouse Trust Agreements Prosper’s consolidated VIEs, PWIT and PWIIT (together, “Warehouse VIEs”), each entered into an agreement (together, “Warehouse Agreements”) with certain lenders for committed revolving lines of credit (“Warehouse Lines”) during 2018 and 2019, respectively. In connection with the Warehouse Agreements, the Warehouse VIEs each entered into a security agreement with a bank as administrative agent and a national banking association as collateral trustee and paying agent. Proceeds under the Warehouse Lines may only be used to purchase certain unsecured consumer loans and related rights and documents from Prosper and to pay fees and expenses related to the Warehouse Lines. Both Warehouse VIEs are consolidated because Prosper is the primary beneficiary of the VIEs. The assets of the VIEs can be used only to settle obligations of the VIEs. Additionally, the creditors of the Warehouse Lines have no recourse to the general credit of Prosper. The loans held in the Warehouse VIEs are included in Loans Held for Sale, at Fair Value and Warehouse Lines are in Warehouse Lines in the consolidated balance sheets. Both Warehouse Agreements contain the same certain covenants including restrictions on each Warehouse VIE's ability to incur indebtedness, pledge assets, merge or consolidate and enter into certain affiliate transactions. Each Warehouse Agreement also requires Prosper to maintain a minimum tangible net worth of $25 million, minimum net liquidity of $15 million and a maximum leverage ratio of 5:1. Tangible net worth is defined as the sum of (i) (A) Convertible Preferred Stock, (B) total Stockholders’ Deficit and (C) Convertible Preferred Stock Warrant Liability, less the sum of (ii) (A) goodwill and (B) intangible assets. Net liquidity is defined as the sum of cash, cash equivalents and Available for Sale Investments. The leverage ratio is defined as the ratio of total consolidated indebtedness other than non-recourse securitization indebtedness, non-recourse or limited recourse warehouse indebtedness and borrower dependent notes, to tangible net worth. As of December 31, 2023, Prosper was in compliance with the covenants under each Warehouse Agreement. PWIT Warehouse Line On January 19, 2018, through PWIT, Prosper entered into a Warehouse Agreement for a Warehouse Line with a national banking association. Effective June 12, 2018, the Warehouse Agreement was amended. The amendments included increasing the committed line of credit from $100 million to $200 million, extending the term of the PWIT Warehouse Line (including the final maturity date), amending the monthly unused commitment fee and reducing the rate at which the PWIT Warehouse Line bears interest. Subsequently the Warehouse Agreement was amended on June 20, 2019 to extend the facility, to reduce the interest rate and unused commitment fee and to expand the eligibility criteria for unsecured consumer loans that can be financed through the PWIT Warehouse Line. It was amended again on May 19, 2021 to extend the facility, to reduce the interest and advance rates and to include provisions for an alternative benchmark rate in light of the ongoing phaseout of LIBOR. On May 5, 2023, PMI further amended its PWIT Warehouse Line (“PWIT 2023 Extension”). The PWIT 2023 Extension increased the maximum borrowing amount from $200 million to $244 million, consisting of a $200 million Class A loan with the existing PWIT Warehouse Line national banking association and a $44 million Class B loan with an asset manager. Under the PWIT 2023 Extension, the total advance rate is 91.5% and proceeds of loans purchased through the PWIT Warehouse Line may be borrowed, repaid and reborrowed until the earlier of June 20, 2024 or the occurrence of any accelerated amortization event or event of default. Repayment on any outstanding proceeds will be made over a 12-month period ending June 20, 2025, excluding the occurrence of any accelerated amortization event or event of default. Under the PWIT 2023 Extension, the Class A loan bears interest at a rate of one-month SOFR, plus a spread of 2.75% per annum, while the Class B loan bears interest at a rate of one-month SOFR, plus a spread of 8.50% per annum. The spread under both loans increases by 0.15% per annum effective January 1, 2024 unless a securitization or refinancing is executed prior to that date. Additionally, until June 20, 2024, both loans bear a daily unused commitment fee of 0.50% per annum on the undrawn portion available under each respective loan. As of December 31, 2023, Prosper had $160.2 million in debt and accrued interest outstanding under the PWIT Warehouse Line. This debt is secured by an aggregate outstanding principal balance of $169.5 million included in Loans Held for Sale, at Fair Value and $10.1 million of cash included in Restricted Cash on the Consolidated Balance Sheets. As of December 31, 2023 the undrawn amount under the PWIT Warehouse Line was $86.0 million. P rosper incurred $2.2 million of deferred debt issuance costs associated with the PWIT Warehouse Line, including $0.3 million from the amendment signed on May 19, 2021, which are included in “Prepaids and Other Assets” and amortized to interest expense over the term of the revolving arrangement. In the fourth quarter of 2023, a loan performance ratio under the Warehouse Agreement was exceeded which resulted in the PWIT Warehouse Line entering accelerated amortization. While in accelerated amortization, all loan collections are applied against the outstanding balance of the PWIT Warehouse Line, and the Company is unable to utilize the undrawn portion. In addition, there is a 1% per annum step-up fee on the outstanding balance. On January 22, 2024, the Company executed an amendment to the PWIT Warehouse Agreement, under which previous breaches of loan performance ratios were waived, the loan performance ratios were revised going forward, and the step-up fee was waived until June 30, 2024. Additionally, the advance rate under the PWIT Warehouse Line will gradually decrease by 1% on a monthly basis through June 2024, until it is reduced to 86.5%. The Company is in compliance with all covenants and revised loan performance ratios set by the amendment to the PWIT Warehouse Agreement as of the date of this report. Prosper maintains a swaption to limit the Company's exposure to increases in SOFR on up to $185.0 million of borrowings under the PWIT Warehouse Line. The swaption is recorded on the consolidated balance sheet at fair value in Prepaids and Other Assets. Any changes in the fair value are recorded in the Change in Fair Value of Financial Instruments on the Consolidated Statement of Operations. The fair value of the swaption was $0.1 million and $1.3 million as of December 31, 2023 and 2022, respectively. The change in fair value of the swaption was a loss of $1.2 million an d a gain of $0.8 million for the years ended December 31, 2023 and 2022, respectively. PWIIT Warehouse Line On March 28, 2019, through PWIIT, Prosper entered into a second Warehouse Agreement for a $300 million Warehouse Line with a national banking association different than that of PWIT. Subsequently on March 4, 2021, PMI extended its $300 million PWIIT Warehouse Line (“PWIIT 2021 Extension”). The PWIIT 2021 Extension consisted of a $230 million Class A loan with the existing PWIIT Warehouse Line national banking association and a $70 million Class B loan with an asset manager. On February 10, 2023, PMI again extended its PWIIT Warehouse Line (“PWIIT 2023 Extension”). The PWIIT 2023 Extension increased the maximum borrowing amount from $300 million to $450 million, consisting of a $400 million Class A loan with the existing PWIIT Warehouse Line national banking association and a $50 million Class B loan with the existing asset manager. In May 2023, the Company further amended the PWIIT Warehouse Line, which included replacing the existing Class B lender with another third-party asset manager and lowering the spread on Class B borrowings. In July 2023, the PWIIT Warehouse Line was further amended, decreasing the maximum borrowing amount from $450 million to $300 million, consisting of a $265 million Class A loan and a $35 million Class B loan. The Class A loan bore interest at a per annum rate of the national banking association's asset-backed commercial paper rate, plus a spread of 2.85%, while the Class B loan bore interest a per annum rate of adjusted one-month SOFR, plus a spread of 8.75%. In conjunction with the PMIT 2023-1 Transaction (see Note 7, Securitizations ), the entire portfolio of Borrower Loans held in the PWIIT Warehouse Line, with an unpaid principal balance of $273.8 million as of September 25, 2023, was transferred to either the PMIT 2023-1 Transaction or PFL, as follows: $266.1 million of those Borrower Loans were contributed into the securitization trust through a depositor, and the remaining $7.7 million consisted of loans ineligible for securitization and were transferred to PFL. Proceeds from the sale of these loans were used to pay down the outstanding principal and interest on the PWIIT Warehouse Line of $224.0 million, and the PWIIT Warehouse line was terminated at that time. Remaining proceeds after transaction expenses were transferred to PMI. As a result of the termination of the PWIIT Warehouse Line, deferred and unamortized debt issuance costs of $1.9 million were immediately amortized into interest expense. Paycheck Protection Program Loan In April 2020, the Company obtained an $8.4 million loan under the PPP, established by the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) and sponsored by the U.S. Small Business Administration (“SBA”). The loan accrued interest at one percent per annum and had a two-year term through April 2022, with payments deferred until such time as an approval or denial of forgiveness was received from the SBA. The Company used the PPP Loan proceeds to cover payroll costs, rent and utilities in accordance with the relevant terms and conditions of the CARES Act. On March 21, 2022, the Company was notified by the SBA that all principal and interest under the loan, totaling $8.6 million, was forgiven in full through a forgiveness payment made on March 15, 2022 by the SBA to the lender of the PPP loan. As a result, the Company recognized a “Gain on Forgiveness of PPP Loan” for this amount on its accompanying Consolidated Statement of Operations for the year ended December 31, 2022. |
NET INCOME (LOSS) PER SHARE
NET INCOME (LOSS) PER SHARE | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
NET INCOME (LOSS) PER SHARE | NET INCOME (LOSS) PER SHARE PMI computes its net income (loss) per share in accordance with ASC Topic 260, Earnings Per Share (“ASC Topic 260”). Under ASC Topic 260, basic net income (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding for the period and excludes the effects of any potentially dilutive securities. PMI’s net income (loss) per share is calculated using the two-class method in accordance with ASC Topic 260. The two-class method allocates earnings that otherwise would have been available to common shareholders to holders of participating securities. Management considers all series of our Convertible Preferred Stock to be participating securities due to their rights to participate in dividends with Common Stock. As such, earnings allocated to these participating securities, which include participation rights in undistributed earnings, are subtracted from net income to determine total undistributed earnings to be allocated to common stockholders. All participating securities are excluded from basic weighted-average common shares outstanding. Prior to any conversion to common shares, each series of Prosper’s Convertible Preferred Stock is entitled to participate on an if-converted basis in distributions of earnings, when and if declared by the board of directors, that are made to common stockholders and consequently, these shares were considered participating securities. During the year ended December 31, 2023, 2022 and 2021, certain shares issued as a result of the early exercise of stock options which are subject to a repurchase right by PMI were entitled to receive non-forfeitable dividends during the vesting period and consequently, are considered participating securities. Basic and diluted net income (loss) per share were calculated as follows for the periods presented (in thousands, except share and per share amounts): December 31, 2023 2022 2021 Numerator: Net (Loss) Income $ (106,462) $ 70,582 $ (138,341) Less: Net Income Allocated to Participating Securities — (47,350) — Net (Loss) Income Attributable to Common Stockholders $ (106,462) $ 23,232 $ (138,341) Denominator: Weighted average shares used in computing basic and diluted Net (Loss) Income Per Share 76,092,569 73,291,714 70,767,275 Effect of dilutive securities: Stock options — 61,466,722 — Warrants — 570,313 — Convertible preferred stock warrants — 213,264,845 — Weighted average shares used in computing diluted Net (Loss) Income Per Share 76,092,569 348,593,594 70,767,275 Net (Loss) Income Per Share – Basic $ (1.40) $ 0.32 $ (1.95) Net (Loss) Income Per Share – Diluted $ (1.40) $ 0.07 $ (1.95) The following common stock equivalents were excluded from the computation of diluted net income (loss) per share for the periods presented because including them would have been anti-dilutive (number of shares): December 31, 2023 2022 2021 Excluded Securities: Convertible Preferred Stock issued and outstanding 158,365,655 158,365,655 158,365,655 Stock options issued and outstanding 80,863,096 17,703,550 72,756,708 Warrants issued and outstanding 1,080,349 510,036 1,080,349 Series E-1 Convertible Preferred Stock warrants 35,544,141 — 35,544,141 Series F Convertible Preferred Stock warrants 177,720,704 — 177,720,704 Total Excluded Securities 453,573,945 176,579,241 445,467,557 |
CONVERTIBLE PREFERRED STOCK, CO
CONVERTIBLE PREFERRED STOCK, CONVERTIBLE PREFERRED STOCK WARRANT LIABILITY AND COMMON STOCK | 12 Months Ended |
Dec. 31, 2023 | |
Stockholders' Equity Note [Abstract] | |
CONVERTIBLE PREFERRED STOCK, CONVERTIBLE PREFERRED STOCK WARRANT LIABILITY AND COMMON STOCK | CONVERTIBLE PREFERRED STOCK, CONVERTIBLE PREFERRED STOCK WARRANT LIABILITY AND COMMON STOCK Convertible Preferred Stock Under PMI’s amended and restated certificate of incorporation, preferred stock is issuable in series and the Board of Directors is authorized to determine the rights, preferences, and terms of each series. In January 2013, PMI issued and sold 69,340,760 shares of Series A Convertible Preferred Stock in a private placement at a purchase price of $0.29 per share for $19.8 million, net of issuance costs. In connection with that sale, PMI issued 25,585,910 shares at par value $0.01 per share of Series A-1 Convertible Preferred Stock to the holders of shares of PMI’s Convertible Preferred Stock that was outstanding immediately prior to the sale (“Old Preferred Shares”) in consideration for such stockholders participating in the sale. In connection with the Series A sale, Old Preferred Shares were converted into shares of Common Stock at a ratio of 1:1 if the holder of the Old Preferred Shares participated in the Series A sale or at a 10:1 ratio if the holder of the Old Preferred Shares did not so participate. In addition, each such participating holder received a share of Series A-1 Convertible Preferred Stock for every dollar of liquidation preference associated with an Old Preferred Share held by such holder. Each share of Series A-1 preferred stock has a liquidation preference of $2.00 and converts into Common Stock at a ratio of 1,000,000:1. The Series A and Series A-1 Convertible Preferred Stock were sold in reliance on the exemption from the registration requirements of the Securities Act set forth in Section 4(2) of the Securities Act and Regulation D promulgated thereunder regarding sales by an issuer not involving a public offering. In September 2013, PMI issued and sold 41,443,670 shares of Series B Convertible Preferred Stock in a private placement at a purchase price of $0.60 per share for approximately $24.9 million, net of issuance costs. The Series B Convertible Preferred Stock was sold in reliance on the exemption from the registration requirements of the Securities Act set forth in Section 4(2) of the Securities Act and Regulation D promulgated thereunder regarding sales by an issuer not involving a public offering. In May 2014, PMI issued and sold 24,404,770 shares of Series C Convertible Preferred Stock in a private placement at a purchase price of $2.87 per share for approximately $69.9 million, net of issuance costs. The Series C Convertible Preferred Stock was sold in reliance on the exemption from the registration requirements of the Securities Act set forth in Section 4(2) of the Securities Act and Regulation D promulgated thereunder regarding sales by an issuer not involving a public offering. The purpose of the Series C private placement was to raise funds for general corporate needs and for the tender offer discussed below. On June 18, 2014, PMI issued a Tender Offer Statement to purchase up to 6,963,785 shares, in the aggregate, of its Series A Convertible Preferred Stock and Series B Convertible Preferred Stock at a price equal to $2.87 per share. Upon closure of the tender offer on July 16, 2014, 782,540 shares of Series A Convertible Preferred Stock and 5,667,790 shares of Series B Convertible Preferred Stock were purchased for an aggregate price of $18.5 million. In April 2015, PMI issued and sold 23,888,640 shares of Series D Convertible Preferred Stock in a private placement at a purchase price of $6.91 per share for proceeds of approximately $164.8 million, net of issuance costs. The Series D Convertible Preferred Stock was sold in reliance on the exemption from the registration requirements of the Securities Act set forth in Section 4(2) of the Securities Act and Regulation D promulgated thereunder regarding sales by an issuer not involving a public offering. The purpose of the Series D private placement was to raise funds for general corporate needs and for the share repurchase discussed below. In December 2016, PMI authorized 40,000,000 shares of Series E Convertible Preferred Stock. These shares are reserved for the Convertible Preferred Stock warrants that were also issued in December 2016 On December 16, 2016, PMI issued a warrant to purchase 20,267,135 shares of Series E-1 Convertible Preferred Stock of PMI at an exercise price of $0.01 per share (the “First Series E-1 Warrant”) to Pinecone Investments LLC (“Pinecone”), an affiliate of Colchis Capital Management, L.P. (“Colchis”). On February 27, 2017, PMI issued to Pinecone Investments LLC a second warrant (the “Second Series E-1 Warrant,” and together with the First Series E-1 Warrant, the “Series E-1 Warrants”) to purchase 15,277,006 shares of Series E-1 Convertible Preferred Stock at an exercise price of $0.01 per share. The Series E-1 Warrants are immediately exercisable, in whole or in part, by paying in cash the full purchase price payable in respect of the number of shares purchased. The Series E-1 Warrants were issued pursuant to the Warrant Agreement dated December 16, 2016 between PMI and Colchis, as previously described in PMI’s Current Report on Form 8-K as filed with the SEC on December 22, 2016. In connection with the Consortium Purchase Agreement entered into with affiliates of the Consortium ( “Warrant Holders”) a warrant agreement was signed (the “Series F Warrant Agreement”). Pursuant to the Series F Warrant Agreement, PMI issued to the Consortium three warrants (together, the “Series F Warrant”) to purchase up to an aggregate 177,720,706 shares of PMI’s Series F Convertible Preferred Stock at an exercise price of $0.01 per share (the “Series F Warrant Shares”). The Warrant Holders' right to exercise the Series F Warrant was subject to monthly vesting during the term of the Consortium Purchase Agreement based upon the volume of loans the Consortium elected to purchase (if any) in each month, subject to certain cure rights such as offering additional loans for sale in subsequent periods. Under the terms of the Series F Warrant Agreement, the Series F Warrant Shares may also vest in full upon a change of control of PMI, insolvency of PMI or PFL, certain breaches of contract by PMI or PFL that are not cured within a defined cure period and upon the occurrence of certain events set forth in the Warrant Agreement. The Series F Warrant will be exercisable with respect to vested Series F Warrant Shares, in whole or in part, at any time prior to the tenth anniversary of its date of issuance. The number of shares underlying the Series F Warrant may be adjusted following certain events such as stock splits, dividends, reclassifications and certain other issuances by PMI. On September 20, 2017, Prosper issued and sold 37,249,497 shares of Series G Convertible Preferred Stock in a private placement at a purchase price of $1.34 per share for proceeds of approximately $47.9 million, net of issuance costs. The Series G Convertible Preferred Stock was sold in reliance on the exemption from the registration requirements of the Securities Act set forth in Section 4(a)(2) of the Securities Act regarding sales by an issuer not involving a public offering. The purpose of the Series G private placement was to raise funds for general corporate purposes. On December 23, 2019, Prosper entered into a Stock Repurchase Agreement with an investor to repurchase 7,221,020 shares, in the aggregate, of Series A, Series A-1, and Series B Convertible Preferred Stock and Common Stock for nominal consideration. Upon execution of the Agreement, 2,130,035 shares of Series A Convertible Preferred Stock, 2,245,600 shares of Series A-1 Convertible Preferred Stock, 648,720 shares of Series B Convertible Preferred Stock and 2,196,665 shares of Common Stock were repurchased. Upon repurchase of Convertible Preferred Stock, the difference between repurchase price and the carrying amount of the Convertible Preferred Stock was recognized in Additional Paid-In Capital. Additionally, the difference between the repurchase price and par value of the Common Stock was recorded through Additional Paid-In Capital. Prosper Grantor Trust On July 13, 2020, the Company established Prosper Grantor Trust (“PGT”), a revocable grantor trust administered by an independent trustee, with the intention of contributing assets to PGT for the benefit of PMI employees in the event of a change in control through an Eligible Employee Retention Plan. PGT was determined to be a VIE and PMI was determined to be its primary beneficiary due to the fact that the Company, through its role as the grantor, has both (a) the power to direct the activities that most significantly affect the VIE’s economic performance, including its funding decisions and investment strategy, and (b) the obligation to absorb losses that could be potentially significant to the economic performance of the VIE by virtue of the Company’s requirement to fund PGT in the event that it is unable to meet its obligations to PMI’s employees. PMI also maintains a contingent call liability on PGT’s assets in the event of a bankruptcy. As a result, PGT is fully consolidated into PMI’s consolidated financial statements. On July 21, 2020, PGT entered into a Stock Transfer Agreement with a PMI investor to purchase 34,670,420 shares of Series A Convertible Preferred Stock and 16,577,495 shares of Series B Convertible Preferred Stock for nominal consideration. Upon execution of the Stock Transfer Agreement, these shares were purchased by a consolidated VIE of the Company, and thus the difference between the fair value of the repurchased stock and the purchase price is included in Convertible Preferred Stock Held by Consolidated VIE on PMI’s accompanying consolidated balance sheet as of December 31, 2023. These shares remain outstanding for legal purposes and retain their voting rights, but are excluded from the earnings per share calculation. The number of authorized, issued and outstanding shares, their par value and liquidation preference for each series of Convertible Preferred Stock as of December 31, 2023 are disclosed in the table below (amounts in thousands, except share and par value amounts): Par Value Authorized Shares Outstanding and Issued Shares Liquidation Preference, Outstanding Shares Series A $ 0.01 68,558,220 66,428,185 * $ 19,160 Series A-1 $ 0.01 24,760,915 22,515,315 45,031 Series B $ 0.01 35,775,880 35,127,160 * 21,190 Series C $ 0.01 24,404,770 24,404,770 70,075 Series D $ 0.01 23,888,640 23,888,640 165,000 Series E-1 $ 0.01 35,544,141 — — Series E-2 $ 0.01 16,858,078 — — Series F $ 0.01 177,720,707 3 — Series G $ 0.01 37,249,497 37,249,497 50,000 Total 444,760,848 209,613,570 $ 370,456 * Series A and Series B Convertible Preferred Stock totals are inclusive of 34,670,420 and 16,577,495 shares, respectively, held by PGT, a consolidated VIE. Dividends Dividends on shares of the Series A, Series B, Series C, Series D, Series E-1, Series E-2, Series F, and Series G Convertible Preferred Stock are payable only when, as, and if declared by the Board of Directors. No dividends will be paid with respect to the Common Stock until any declared dividends on the Convertible Preferred Stock have been paid or set aside for payment to the preferred stockholders. After payment of any such dividends, any additional dividends or distributions will be distributed among all holders of Common Stock and preferred stock in proportion to the number of shares of Common Stock that would be held by each such holder if all shares of preferred stock were converted to Common Stock at the then effective conversion rate. The Series A-1 convertible preferred shares have no dividend rights. To date, no dividends have been declared on any of PMI’s preferred stock or Common Stock. Conversion Under the terms of PMI’s amended and restated certificate of incorporation, the holders of preferred stock have the right to convert such preferred stock into Common Stock at any time. In addition, all preferred stock automatically converts into Common Stock (x) immediately prior to the closing of an initial public offering that values Prosper at least at $2 billion and that results in aggregate proceeds to Prosper of at least $100 million or (y) upon a written request from the holders of at least 60% of the voting power of the outstanding preferred stock (on an as-converted basis, provided that: (i) the Series A-1 Convertible Preferred Stock shall not be converted without at least 14% of the voting power of the outstanding Series A-1 Convertible Preferred Stock; (ii) the Series D shall not be converted without at least 60% of the voting power of the outstanding Series D; (iii) the Series E-1 and Series E-2 shall not be converted without at least 60% of the voting power of the outstanding Series E-1 and Series E-2, voting together as a single class; (iv) the Series F shall not be converted without at least 60% of the voting power of the outstanding Series F, and (v) the shares of Series G Preferred Stock will not be automatically converted unless the holders of at least 60% of the outstanding shares of Series G Preferred Stock approve such conversion). In addition, if a holder of the Series A Convertible Preferred Stock has converted any of the Series A Convertible Preferred Stock, then all of such holder’s shares of Series A-1 Convertible Preferred Stock also will be converted upon a liquidation event (as defined under the certificate of incorporation). In lieu of any fractional shares of Common Stock to which a holder would otherwise be entitled, PMI shall pay such holder cash in an amount equal to the fair market value of such fractional shares, as determined by its Board of Directors. At present, each of the Series A, Series B, Series C, Series D, Series E-1, Series E-2, and Series F Convertible Preferred Stock converts into PMI Common Stock at a 1:1 ratio. The Series A-1 Convertible Preferred Stock converts into Common Stock at a 1,000,000:1 ratio and the Series G Convertible Preferred Stock converts into Common Stock at a 1:1.36 ratio. The Series G Convertible Preferred Stock conversion ratio reflects the Series G true-up that occurred at end of the vesting period for the Series E-2 and Series F Preferred Stock warrants. For the Series G true-up, the conversion price of the Series G Convertible Preferred Stock was reduced to a number equal to the Series G Preferred Stock original issuance price, divided by the quotient obtained by dividing the Series G true-up amount by the total number of Series G Preferred Stock issued as of the Series G closing date. The Series G true-up amount means the aggregate number of shares of Series G Preferred Stock that would have been issued to the purchasers of the Series G Preferred Stock on the Series G closing date, if warrants to purchase shares of Series E-2 Preferred Stock or Series F Preferred Stock that were exercisable or exercised as of the true-up time (end of vesting period) had been exercisable or exercised as of such Series G closing date. Liquidation Rights PMI’s Convertible Preferred Stock has been classified as temporary equity on the consolidated balance sheet. The preferred stock is not redeemable; however, in the event of a voluntary or involuntary liquidation, dissolution, change in control or winding up of PMI, holders of the Convertible Preferred Stock may have the right to receive its liquidation preference under the terms of PMI’s certificate of incorporation. Each holder of Series E-1, Series E-2 and Series F Convertible Preferred Stock is entitled to receive prior and in preference to any distribution of proceeds from a liquidation event (as defined under the certificate of incorporation) to the holders of Series A, Series B, Series C, Series D, Series G and Series A-1 Convertible Preferred Stock or Common Stock, an amount per share for (i) each share of Series E-1 Convertible Preferred Stock equal to the sum of the liquidation preference specified for such share and all declared but unpaid dividends, if any, on such share, (ii) each share of Series E-2 Convertible Preferred Stock equal to the sum of two-thirds the liquidation preference specified for such share and all declared but unpaid dividends, if any, on such share, and (iii) each share of Series F Convertible Preferred Stock equal to the sum of two-thirds of the liquidation preference specified for such share and all declared but unpaid dividends, if any, on such share. After the payment or setting aside for payment to the holders of Series E-1, Series E-2, and Series F Convertible Preferred Stock each holder of Series A, Series B, Series C and Series D, Series E-2, Series F and Series G Convertible Preferred Stock is entitled to receive, on a pari passu basis, prior to and in preference to any distribution of proceeds from a liquidation event (as defined under the certificate of incorporation) to the holders of Series A-1 Convertible Preferred Stock or Common Stock, (i) an amount per share for each share of Series E-2 and Series F Convertible Preferred Stock equal to the sum of one-third of the liquidation preference specified for such share and all declared but unpaid dividends, if any, on such share, and (ii) an amount per share for each share of Series A, Series B, Series C, Series D and Series G Convertible Preferred Stock equal to the sum of the liquidation preference specified for such share and all declared but unpaid dividends, if any, on such share. After the payment or setting aside for payment to the holders of Series A, Series B, Series C, Series D, Series E-1, Series E-2, Series F and Series G Convertible Preferred Stock, the holders of Series A-1 Convertible Preferred Stock are entitled to receive, prior and in preference to any distribution of proceeds to the holders of Common Stock, an amount per share for each such share of Series A-1 Convertible Preferred Stock equal to the sum of the liquidation preference specified for such share and all declared but unpaid dividends, if any, on such share. After the payment or setting aside for payment to the holders of Series A, Series B, Series C, Series D, Series E-1, Series E-2, Series F, Series G and Series A-1 Convertible Preferred Stock, the entire remaining proceeds legally available for distribution will be distributed pro-rata to the holders of Series A Convertible Preferred Stock and Common Stock in proportion to the number of shares of Common Stock held by them assuming the Series A Convertible Preferred Stock has been converted into shares of Common Stock at the then effective conversion rate, provided that the maximum aggregate amount per share of Series A Convertible Preferred Stock which the holders of Series A Convertible Preferred Stock shall be entitled to receive is three times the original issue price for the Series A Convertible Preferred Stock. At present, the liquidation preferences are equal to $0.29 per share for the Series A Convertible Preferred Stock, $2.00 per share for the Series A-1 Convertible Preferred Stock, $0.60 per share for the Series B Convertible Preferred Stock, $2.87 per share for the Series C Convertible Preferred Stock, $6.91 per share for the Series D Convertible Preferred Stock, $0.84 per share for the Series E-1 Convertible Preferred Stock, $0.84 per share for the Series E-2 Convertible Preferred Stock, $0.84 per share for the Series F Convertible Preferred Stock and $1.34 per share for the Series G Convertible Preferred Stock. Voting Each holder of shares of Convertible Preferred Stock is entitled to the number of votes equal to the number of shares of Common Stock into which such shares of Convertible Preferred Stock could be converted and each has voting rights and powers equal to the voting rights and powers of the Common Stock. The holders of Convertible Preferred Stock and the holders of Common Stock vote together as a single class (except with respect to certain matters that require separate votes or as required by law), and are entitled to notice of any stockholders’ meeting in accordance with the Bylaws of PMI. Convertible Preferred Stock Warrant Liability Series E-1 Warrants In connection with the Settlement and Release Agreement dated November 17, 2016 among PMI, its wholly owned subsidiary PFL and Colchis, on December 16, 2016, PMI issued the First Series E-1 Warrant. The Second Series E-1 Warrant for an additional 15,277,006 shares of Series E-1 Convertible Preferred Stock was granted on the signing of the Consortium Purchase Agreement on February 27, 2017. The warrants expire ten years from the date of issuance. Prosp er re cognized $7.8 million of expense and $13.5 million of income from the re-measurement of the fair value of the warrants for the years ended December 31, 2023 and 2022, respectively. The income or expense resulted from remeasurement of th e fair value of the warrants is recorded in Change in Fair Value of Convertible Preferred Stock Warrants on the Consolidated Statements of Operations. To determine the fair value of the Series E-1 Warrants, the Company first determined the value of a share of a Series E-1 Convertible Preferred Stock. To determine the fair value of the Convertible Preferred Stock, the Company first derived the business enterprise value (“BEV”) of the Company using a variety of valuation methods, including discounted cash flow models and market based methods, as deemed appropriate under the circumstances applicable at the valuation date. Once the Company determined an estimated BEV, the option pricing method (“OPM”) was used to allocate the BEV to the various classes of our equity, including our preferred stock. The concluded per share value for the Series E-1 Convertible Preferred Stock was utilized as an input to the Black-Scholes option pricing model. The Company determined the fair value of the outstanding Series E-1 preferred stock warrants utilizing the following assumptions as of December 31, 2023 and 2022: December 31, 2023 2022 Volatility 66.0 % 72.0 % Risk-free interest rate 4.10 % 4.30 % Expected term (in years) 2.75 2.75 Dividend yield — % — % The above assumptions were determined as follows: Volatility: The volatility is derived from historical volatilities of several unrelated publicly listed peer companies over a period approximately equal to the term of the warrant as the Company has limited information on the volatility of its preferred stock since there is currently no trading history. When making the selections of industry peer companies to be used in the volatility calculation, the Company considered the size, operational, and economic similarities to the Company’s principal business operations. Risk-Free Interest Rate: The risk-free interest rate is based on the U.S. Treasury yield in effect as of December 31, 2023, and for zero coupon U.S. Treasury notes with maturities approximately equal to the term of the warrant. Expected Term: The expected term is the period of time for which the warrants are expected to be outstanding. Dividend Yield: The expected dividend assumption is based on the Company’s current expectations about the Company’s anticipated dividend policy. Series F Warrants In connection with the Consortium Purchase Agreement on February 27, 2017 , PMI issued warrants to purchase up to 177,720,706 shares of PMI's Series F Convertible Preferred Stock at $0.01 per share. The warrants expire ten years from the date of issuance. Prosper recognize d $40.9 million of expense nd $71.1 million of income from the re-measurement of the fair value of the warrants for the years ended December 31, 2023 and 2022, respectively. The income or expense resulting from changes in the fair value of the warrant is recorded through Change in Fair Value of Convertible Preferred Stock Warrants on the Consolidated Statements of Operations. To determine the fair value of the Series F Warrants, the Company first determined the value of a share of a Series F Convertible Preferred Stock. To determine the fair value of the Convertible Preferred Stock, the Company first derived the BEV using valuation methods, including a combination of methods, as deemed appropriate under the circumstances applicable at the valuation date. Once the Company determined an estimated BEV, the OPM was used to allocate the BEV to the various classes of Prosper's equity, including our preferred stock. The concluded per share value for the Series F Convertible Preferred Stock warrants utilized the Black-Scholes option pricing model. The Company determined the fair value of the outstanding Series F Warrants utilizing the following assumptions as of December 31, 2023 and 2022: December 31, 2023 2022 Volatility 66.00 % 72.0 % Risk-free interest rate 4.10 % 4.30 % Expected term (in years) 2.75 2.75 Dividend yield — % — % The above assumptions were determined using the same criteria described above for the Series E-1 Warrants. The combined activity of the Convertible Preferred Stock Warrant Liability for the years ended December 31, 2023 and 2022 are presented in Note 8, Fair Value of Assets and Liabilities. Starting with the Series E and F Warrant valuations prepared as of September 30, 2023, due to a change in methodology, the Company removed the discount for lack of marketability that was previously applied to the Black-Scholes option pricing valuation. This change in accounting estimate resulted in an increase to the Convertible Preferred Stock Warrant Liability and the Change in Fair Value of Convertible Preferred Stock Warrants of approximately $39.7 million as of December 31, 2023 and for the year then ended. Common Stock PMI, through its Amended and Restated Certificate of Incorporation, is the sole issuer of Common Stock and related options, RSUs and warrants. On February 16, 2016, PMI amended and restated its Certificate of Incorporation to, among other things, effect a 5-for-1 forward stock split. On September 20, 2017, PMI further amended its Amended and Restated Certificate of Incorporation to increase the number of shares of Common Stock authorized for issuance. The total number of shares of stock which PMI has the authority to issue is 1,069,760,848, consisting of 625,000,000 shares of Common Stock, $0.01 par value per share, and 444,760,848 shares of preferred stock, $0.01 par value per share. As described above, the Company repurchased 2,196,665 shares of Common Stock on December 23, 2019. As of December 31, 2023, 77,861,329 shares of Common Stock were issued and 76,925,394 shares of Common Stock were outstanding. As of December 31, 2022, 75,223,850 shares of Common Stock were issued and 74,287,915 shares of Common Stock were outstanding. Each holder of common stock is entitled to one vote for each share of common stock held. Common Stock Issued upon Exercise of Stock Options During the year ended December 31, 2023 and |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION PMI grants equity awards primarily through its Amended and Restated 2005 Stock Option Plan (the “2005 Plan”), which was approved as amended and restated by its stockholders on December 1, 2010; and its 2015 Equity Incentive Plan, which was approved by its stockholders on April 7, 2015 and subsequently amended by an Amendment No. 1, Amendment No. 2 and Amendment No. 3, which were approved by PMI's stockholders effective as of February 15, 2016, May 31, 2016, and September 5, 2018 respectively (as amended, the “2015 Plan”). In March 2015, the 2005 Plan expired, except that any awards granted under the 2005 Plan prior to its expiration remain in effect pursuant to their terms. As of December 31, 2023, under the 2005 Plan and 2015 Plan, options to purchase up to 92,084,513 shares of PMI's Common Stock are reserved and may be granted to employees, directors, and consultants by PMI’s Board of Directors and stockholders to promote the success of Prosper’s business. Options generally vest 25% one year from the vesting commencement date and 1/48t h per month thereafter or vest 50% two years from the vesting commencement date and 1/48 per month thereafter or vest 1/36th per month from the vesting commencement date. In no event are options exercisable more than ten years after the date of grant. Stock Option Activity Stock option activity under the 2005 Plan and 2015 Plan is summarized for the year ended December 31, 2023 below: Options Issued and Outstanding Weighted- Average Exercise Price Weighted-Average Contractual Term (in years) Aggregate intrinsic value 1 (in thousands) Balance as of January 1, 2023 77,727,763 $ 0.13 6.22 $ 19,450 Options granted 11,086,530 $ 0.34 Options exercised (2,637,479) $ 0.04 Options forfeited (4,024,418) $ 0.35 Option expirations (39,125) $ 0.02 Balance as of December 31, 2023 82,113,271 $ 0.15 5.70 $ 22,107 Options vested and expected to vest as of December 31, 2023 77,171,342 $ 0.15 5.70 $ 21,659 Options vested and exercisable at December 31, 2023 60,741,572 $ 0.08 4.65 $ 20,168 1. Aggregate intrinsic value represents the excess of the fair value of our Common Stock as of December 31, 2023 over the exercise price of the outstanding in-the-money options. Additional information pertaining to PMI's Common Stock option activities is as follows: Year ended December 31, 2023 2022 2021 Weighted-average grant date fair value of options granted (per share) $ 0.21 $ 0.37 $ 0.13 Other Information Regarding Stock Options The fair value of options granted to employees is estimated on the grant date using the Black-Scholes option valuation model. This valuation model for stock-based compensation expense requires PMI to make assumptions and judgments about the variables used in the calculation, including the fair value of PMI’s Common Stock, the expected term (the period of time that the options granted are expected to be outstanding), the volatility of PMI’s Common Stock, a risk-free interest rate, and expected dividends. Given the absence of a publicly traded market, the Company considered numerous objective and subjective factors to determine the fair value of PMI’s Common Stock at each grant date. These factors included, but were not limited to: (i) contemporaneous valuations of Common Stock performed by unrelated third-party specialists, (ii) the prices for PMI’s preferred stock sold to outside investors, (iii) the rights, preferences and privileges of PMI’s preferred stock relative to PMI’s Common Stock; (iv) the lack of marketability of PMI’s Common Stock, (v) developments in the business, (vi) secondary transactions of PMI’s common and preferred shares, and (vii) the likelihood of achieving a liquidity event, such as an initial public offering or a merger or acquisition of Prosper, given prevailing market conditions. As PMI’s stock is not publicly traded, volatility for stock options is based on an average of the historical volatilities of the Common Stock of several entities with characteristics similar to those of PMI. The expected term assumptions were determined based on the vesting terms, exercise terms and contractual lives of the options using the simplified method. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for periods corresponding with the expected life of the option. PMI uses an expected dividend yield of zero as it does not anticipate paying any dividends in the foreseeable future. PMI also estimates forfeitures of unvested stock options. Expected forfeitures are based on the Company’s historical experience. To the extent actual forfeitures differ from the estimates, the difference will be recorded as a cumulative adjustment in the period estimates are revised. No compensation cost is recorded for options that do not vest. The fair value of PMI’s stock option awards granted during the years ended December 31, 2023, 2022 and 2021 was estimated at the date of grant using the Black-Scholes model with the following weighted average assumptions: December 31, 2023 2022 2021 Volatility of common stock 66.63 % 67.19 % 64.22 % Risk-free interest rate 3.55 % 2.95 % 1.02 % Expected life 6.0 years 6.0 years 6.0 years Dividend yield — % — % — % PMI did not grant any performance-based options in 2023, 2022, or 2021. Restricted Stock Unit Activity For the years ended December 31, 2023, 2022 and 2021, PMI did not grant any RSUs. The following table summarizes the number of PMI’s RSU activity for the year ended December 31, 2023: Number of Shares Weighted-Average Grant Date Fair Value Unvested at January 1, 2023 2,602,383 $ 1.04 Forfeited (27,750) $ 2.18 Expired — $ — Unvested at December 31, 2023 2,574,633 $ 1.03 Stock-Based Compensation The following table presents the amount of stock-based compensation related to stock-based awards granted to employees recognized in the Company’s Consolidated Statements of Operations for the periods presented (in thousands): Years Ended December 31, 2023 2022 2021 Origination and Servicing $ 83 $ 134 $ 123 Sales and Marketing 304 118 62 General and Administrative 1,188 1,074 951 Total Stock-Based Compensation $ 1,575 $ 1,326 $ 1,136 For the years ended December 31, 2023, 2022 and 2021, Prosper capi talized $230 thousand, $200 thousand and $137 thousand, respectively, of stock-based compensation as internal use software and website de velopment costs. As of December 31, 2023, the unamortized stock-based comp ensation expense adjusted for forfeiture estimates related to Prosper's employees’ unvested stock-based awards was approximately $2.7 million, which will be recognized over a remaining weighted-average vesting period of approximately 2.5 years. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
INCOME TAXES | INCOME TAXES The components of the Company’s Income Tax Expense are as follows for the periods presented (in thousands): Years Ended December 31, 2023 2022 2021 Current: Federal $ — $ — $ — State 15 197 — Foreign — — — Total Current Income Tax Expense 15 197 — Deferred: Federal 47 47 47 State 16 51 24 Foreign — — — Total Deferred Income Tax Expense 63 98 71 Total Income Tax Expense $ 78 $ 295 $ 71 Income Tax Expense differed from the amount computed by applying the U.S. federal income tax rate of 21% to pretax income (loss) as a result of the following for the periods presented: Years Ended December 31, 2023 2022 2021 Federal tax at statutory rate 21 % 21 % 21 % State tax at statutory rate (net of federal benefit) 8 % 6 % 8 % Incentive stock options (1) % 1 % (5) % Preferred Stock Warrants (12) % (36) % (29) % Change in valuation allowance (18) % 15 % 6 % Return-to-provision (1) % (2) % — % State tax rate changes 2 % (5) % — % Other 1 % — % (1) % Income Tax Expense — % — % — % Temporary items that give rise to significant portions of deferred tax assets and liabilities are as follows for the periods presented (in thousands): December 31, 2023 2022 Net operating loss carry forwards $ 103,119 $ 85,330 Research and other credits 3,589 3438 Stock compensation 3,816 4,025 Accrued liabilities 4,520 5,159 Net servicing rights 35 — Lease liabilities 4,181 4,798 Property and equipment 2,029 1,214 Section 174 R&D capitalization 9,919 11,204 Total deferred tax assets 131,208 115,168 Net servicing rights — (2,040) Intangible assets (2,468) (2,129) Right-of-use assets (3,137) (4,147) Total deferred tax liabilities (5,605) (8,316) Total net deferred tax asset 125,603 106,852 Less: Valuation allowance (126,324) (107,512) Net deferred tax liability $ (721) $ (660) Under ASC 740, Accounting for Income Taxes , a valuation allowance must be established when it is more likely than not that all or a portion of a deferred tax asset will not be realized. The amount of valuation allowance is based upon management’s best estimate of Prosper’s ability to realize the net deferred tax assets. A valuation allowance can subsequently be reduced when management believes that the assets are realizable on a more-likely-than-not basis. As of December 31, 2023, the Company continues to record a valuation allowance against its net deferred tax asset. The valuation allowance as of December 31, 2023, increased by $18.8 million to $126.3 million from the prior year. The Internal Revenue Code imposes substantial restrictions on the utilization of net operating losses and tax credits in the event of an “ownership change” of a corporation. Accordingly, Prosper’s ability to utilize net operating losses and credit carryforwards may be limited in the future as the result of such an “ownership change.” Prosper files federal and various state income tax returns, and has net operating loss carryforwards available to reduce future taxable income, if any, for both federal and state income tax purposes of approximately $362.6 million and $449.9 million, respectively, as of December 31, 2023, before any potential limitations for “ownership changes.” The state net operating loss carryforwards are primarily related to California. The federal and state net operating loss carryforwards will begin to expire in 2027 and 2024, respectively. All net operating loss carryforwards are subject to a full valuation allowance. Prosper has federal and California research and development tax credits of approximately $2.8 million and $2.8 million, respectively. The federal research credits will begin to expire in 2034 and the California research credits have no expiration date. The following table summarizes Prosper’s activity related to its unrecognized tax benefits (in thousands): Balance at December 31, 2020 $ 112 Change related to 2021 tax year position — Balance at December 31, 2021 $ 112 Increase related to 2022 tax year position 1,179 Balance at December 31, 2022 $ 1,291 Change related to prior year tax position — Balance at December 31, 2023 $ 1,291 None of the unrecognized tax benefits would affect Prosper’s effective tax rate if these amounts are recognized due to the full valuation allowance. Prosper’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of Income Tax Expense. As of December 31, 2023, Prosper has not incurred significant interest or penalties. All tax returns will remain open for examination by federal and most state taxing authorities for three Beginning in 2022, the Tax Cuts and Jobs Act of 2017 eliminates the option to deduct research and development expenditures and requires U.S. taxpayers to amortize them over five years pursuant to Internal Revenue Code Section 174, effective for tax year 2022. The enactment of IRC 174 did not have a material impact on the Company's income tax liabilities. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
INCOME TAXES | INCOME TAXES PFL incurred no income tax provision for the year ended December 31, 2023 and 2022. PFL is a U.S. disregarded entity and its income and loss are included in the income tax reporting of its parent, PMI. Since PMI is in a taxable loss position, is not currently subject to income taxes, and has fully reserved against its deferred tax asset, the net effective tax rate for PFL is 0%. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
LEASES | LEASES Prosper has operating leases for corporate offices and datacenters. These leases have remaining lease terms of less than three years to approximately five years. Some of the lease agreements include options to extend the lease term for up to an additional five years . Rental expense under operating lease arrangements was $4.3 million, $4.7 million and $4.5 million for the years ended December 31, 2023, 2022 and 2021, respectively. Additionally, Prosper subleases certain leased office space to third parties when it determines there is excess leased capacity. Sublease revenue from operating lease arrangements was $0.4 million, $0.7 million and $0.3 million for the years ended December 31, 2023, 2022 and 2021, respectively. Operating Lease Right-of-Use Assets The following table summarizes the operating lease ROU assets as of December 31, 2023 , which are included in Property and Equipment, Net on the Consolidated Balance Sheets . December 31, 2023 Gross Carrying Value Accumulated Amortization Net Carrying Value ROU assets - office buildings $ 22,655 $ 11,825 $ 10,830 The Company identified certain impairment triggers related to its ROU assets in 2023, primarily due to the vacancy of a portion of the Company’s leased office space and the time expected to find a new subtenant. As a result of impairment testing performed on these ROU assets, the Company recorded an impairment charge of $196 thousand for the year ended December 31, 2023. No impairment charge was identified for the years ended 2022 and 2021 . In May 2022, the Company entered into an amendment to its San Francisco office lease, the most prominent impact of which was to extend the lease term for the Company’s primary space in that office for an additional period through May 2028. As a result of this lease modification, the Company recorded additional ROU operating lease assets and liabilities of $9.9 million. Lease Liabilities Future maturities of operating lease liabilities as of December 31, 2023 were as follows (in thousands). The present value of the future minimum lease payments represents the Company’s operating lease liabilities as of December 31, 2023 and are included in “ Other Liabilities” December 31, 2023 2024 $ 4,497 2025 4,517 2026 4,432 2027 3,311 2028 1,411 Thereafter — Total future minimum lease payments 18,168 Less: Imputed interest (3,737) Present value of future minimum lease payments $ 14,431 Because the rate implicit in each lease is not readily determinable, we use our incremental borrowing rate to determine the present value of the lease payments. Supplemental cash flow information related to the Company’s operating leases is as follows (dollars in thousands): Years Ended December 31, 2023 2022 2021 Non-cash operating activity: ROU assets obtained or adjusted in exchange for new, amended and modified operating lease liabilities $ (697) $ 9,980 $ 1,773 The weighted-average remaining lease term and discount rate used in the calculation of the Company’s operating lease assets and liabilities are as follows (dollars in thousands): December 31, 2023 Weighted-average remaining lease term 4.01 years Weighted-average discount rate 11.27 % |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES In the normal course of its operations, Prosper becomes involved in various legal actions. Prosper maintains provisions it considers to be adequate for such actions. Prosper does not believe it is probable that the ultimate liability, if any, arising out of any such matters will have a material effect on Prosper's financial condition, results of operations or cash flows. Operating Commitments PMI, along with PFL, and WebBank has entered into: (i) an Asset Sale Agreement, dated July 1, 2016, between PFL and WebBank, as most recently amended by a Seventh Amendment dated February 28, 2024 (as amended, the “Sale Agreement”); (ii) the Marketing Agreement, dated July 1, 2016, between PMI and WebBank, as most recently amended by a Seventh Amendment dated February 28, 2024 (as amended, the “Marketing Agreement”); and (iii) the Stand By Purchase Agreement, dated July 1, 2016, between PMI and WebBank, as most recently amended by a Fourth Amendment dated February 28, 2024 (as amended, the “Purchase Agreement” and, collectively with the Sale Agreement and the Marketing Agreement, the “Origination and Sale Agreements”). Under the Origination and Sale Agreements, all Borrower Loans originated through the marketplace are made by WebBank under its bank charter. The Origination and Sale Agreements contain terms through February 1, 2027. Prosper is required, under the Origination and Sale Agreements, to maintain certain collateral requirements. In addition, pursuant to the Marketing Agreement, the marketing fee that Prosper receives in connection with the origination of each loan is partially reduced by an amount (the “Designated Amount”) calculated as a percentage of the principal amount of such loan based on the aggregate principal amount of loans originated for the applicable month. To the extent the aggregate Designated Amount for all loans originated during any month is less than $100,000 through February 1, 2025, Prosper is required to pay WebBank an amount equal to such deficiency. Accordingly, t he minimum fee is $1.2 million for 2024, and $0.1 million in 2025. On February 28, 2024, the Origination and Sale Agreements were amended to, among other things, extend the terms through February 1, 2027. Additionally, under the Origination and Sale Agreements, Prosper is required to maintain minimum net liquidity of $15.0 million at all times during the term of the agreement. Net liquidity is defined as the sum of Cash, Cash Equivalents and Available for Sale Investments. Violation of this covenant can result in termination of the contract with WebBank. At December 31, 2023, Prosper was in compliance with the covenant. Transaction Fee Refunds Prosper assumes WebBank’s liability under Utah law to refund the pro-rated amount of any transaction fees collected in excess of 5%, in the event the underlying borrower prepays the loan before full maturity. As of December 31, 2023, the Company has accrued $1.6 million related to anticipated future refunds under this obligation. Loan Purchase Commitments Prosper entered into an agreement with WebBank to purchase $17.7 million of Borrower Loans that WebBank originated during the last two business days of the year ended December 31, 2023. Prosper will purchase these Borrower Loans within the first two business days of the year ending December 31, 2023. Repurchase Obligation Under the terms of the loan purchase agreements between Prosper and investors that participate in the Whole Loan Channel, Prosper may, in certain circumstances, become obligated to repurchase a Borrower Loan from an investor. Generally, these circumstances include the occurrence of verifiable identity theft, the failure to properly follow personal loan listing or bidding protocols or a violation of the applicable federal, state or local lending laws. Prosper recognizes a liability at fair value for the repurchase obligation when the Borrower Loans are sold. The fair value of the repurchase obligation is estimated based on historical experience. Repurchased Borrower Loans associated with violations of federal, state or local lending laws or verifiable identity theft are written off at the time of repurchase. The maximum potential amount of future payments associated with this obligation is the outstanding balances of the Borrower Loans issued to third parties through the Whole Loan Channel, which at December 31, 2023 is $3.1 billion . Prosper has accrued $0.5 million and $0.3 million as of December 31, 2023 and 2022, respectively, in regard to this obligation. Under the terms of the indenture and investor registration agreement, Prosper may, in certain circumstances, become obligated to either repurchase a Note or indemnify the investor for any losses resulting from nonpayment of a Note purchased in the Retail Channel. The decision to repurchase or indemnify is in Prosper’s sole discretion. These circumstances include, but are not limited to, the occurrence of verifiable identity theft, a technical error in the automated bidding tools which results in the purchase of a Note that does not match the investor’s investment criteria, or situations in which a personal loan listing includes a Prosper Rating that is different from the Prosper Rating that should have appeared in the listing for the corresponding Borrower Loan because either PFL inaccurately input data into, or inaccurately applied, the formula for determining the Prosper Rating and, as a result, the interest of the investor is materially and adversely affected. During the year ended December 31, 2023 the Company repurchased $0.3 million of Notes under these circumstances, and has agreed to indemnify additional Notes with an unpaid principal balance of $0.8 million as of December 31, 2023. Regulatory Contingencies Prosper accrues for contingencies when a loss from such contingencies is probable and the amount of loss can be reasonably estimated. In determining whether a loss is probable and if it is possible to quantify the amount of the estimated loss, Prosper reviews and evaluates its litigation and regulatory matters on at least a quarterly basis in light of potentially relevant factual and legal developments. If Prosper determines that an unfavorable outcome is not probable or that the amount of a loss cannot be reasonably estimated, Prosper does not accrue for a potential litigation loss. If an unfavorable outcome is probable and Prosper can estimate a range of outcomes, an amount is recorded which management considers to be the best estimate within the range of potential losses that are both probable and estimable; however, if management cannot quantify the amount of the estimated loss, then the low end of the range of the potential losses is recorded. West Virginia Matter In February 2020, Prosper received a proposed Assurance of Discontinuance (an “AOD”) from the Attorney General of the State of West Virginia (the “WV Attorney General”) requesting that, without in any way admitting that any of its prior practices were in violation of the West Virginia Consumer Credit and Protection Act (the “Consumer Act”), Prosper agree to certain terms and conditions regarding its past and potential future conduct of its business with respect to customers in West Virginia, including a release by the WV Attorney General of any claims it may have related to the matters identified in the AOD. We cannot predict the outcome of the matter and any potential fines or penalties, if any, that may arise from the matter. Further, we are unable to estimate a range of outcomes and as a result no accrual has been made. No loans have been originated through the Prosper platform to West Virginians since June 2016 and the final loan originated through the Prosper platform to a borrower in West Virginia was repaid in October 2021. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES In the normal course of its operations, PFL becomes involved in various legal actions. PFL maintains provisions it considers to be adequate for such actions. The Company does not believe it is probable that the ultimate liability, if any, arising out of any such matters will have a material effect on financial condition, results of operations or cash flows. Operating Commitments PMI, along with PFL, and WebBank has entered into: (i) an Asset Sale Agreement, dated July 1, 2016, between PFL and WebBank, as most recently amended by a Seventh Amendment dated February 28, 2024 (as amended, the “Sale Agreement”); (ii) the Marketing Agreement, dated July 1, 2016, between PMI and WebBank, as most recently amended by a Seventh Amendment dated February 28, 2024 (as amended, the “Marketing Agreement”); and (iii) the Stand By Purchase Agreement, dated July 1, 2016, between PMI and WebBank, as most recently amended by a Fourth Amendment dated February 28, 2024 (as amended, the “Purchase Agreement” and, collectively with the Sale Agreement and the Marketing Agreement, the “Origination and Sale Agreements”). Under the Origination and Sale Agreements, all Borrower Loans originated through the marketplace are made by WebBank under its bank charter. The Origination and Sale Agreements contain terms through February 1, 2027. Prosper is required, under the Origination and Sale Agreements, to maintain certain collateral requirements. In addition, pursuant to the Marketing Agreement, the marketing fee that Prosper receives in connection with the origination of each loan is partially reduced by an amount (the “Designated Amount”) calculated as a percentage of the principal amount of such loan based on the aggregate principal amount of loans originated for the applicable month. To the extent the aggregate Designated Amount for all loans originated during any month is less than $100,000 through February 1, 2025, Prosper is required to pay WebBank an amount equal to such deficiency. Accordingly, the minimum fee is $1.2 million for 2024, and $0.1 million in 2025. On February 28, 2024, the Origination and Sale Agreements were amended to, among other things, extend the terms through February 1, 2027. Additionally, under the Origination and Sale Agreements, Prosper is required to maintain minimum net liquidity of $15 million at all times during the term of the agreement. Net liquidity is defined as the sum of Cash, Cash Equivalents and Available for Sale Investments. Violation of this covenant can result in termination of the contract with WebBank. As of December 31, 2023 the Company was in compliance with the covenant. Transaction Fee Refunds Prosper assumes WebBank’s liability under Utah law to refund the pro-rated amount of any transaction fees collected in excess of 5%, in the event the underlying borrower prepays the loan before full maturity. As of December 31, 2023, the PFL has accrued $1.6 million related to anticipated future refunds under this obligation. Loan Purchase Commitments Under the terms of PFL's agreement with WebBank, PFL is committed to purcha se $17.7 million of B orrower Loans that WebBank originated during the last two business days of the year ended December 31, 2023. PFL will purchase these Borrower Loans within the first two business days of the year ending December 31, 2023. Repurchase Obligation Under the terms of the loan purchase agreements between PFL and investors that participate in the Whole Loan Channel, PFL may, in certain circumstances, become obligated to repurchase a Borrower Loan from an investor. Generally, these circumstances include the occurrence of verifiable identity theft, the failure to properly follow personal loan listing or bidding protocols or a violation of the applicable federal, state or local lending laws. The fair value of the indemnification and repurchase obligation is estimated based on historical experience. PFL recognizes a liability for the repurchase and indemnification obligation when the Borrower Loans are issued. Indemnified or repurchased Borrower Loans associated with violations of federal, state or local lending laws or verifiable identity theft are written off at the time of repurchase or at the time an indemnification payment is made. The maximum potential amount of future payments associated under this repurchase obligation is the outstanding balances of the Borrower Loans issued through the Whole Loan Channel, which at December 31, 2023 was $3.5 billion. PFL has accrued $0.5 million and $0.3 million as of December 31, 2023 and 2022 respectively in regard to this obligation. Under the terms of the indenture and investor registration agreement, Prosper may, in certain circumstances, become obligated to either repurchase a Note or indemnify the investor for any losses resulting from nonpayment of a Note purchased in the Retail Channel. The decision to repurchase or indemnify is in Prosper’s sole discretion. These circumstances include, but are not limited to, the occurrence of verifiable identity theft, a technical error in the automated bidding tools which results in the purchase of a Note that does not match the investor’s investment criteria, or situations in which a personal loan listing includes a Prosper Rating that is different from the Prosper Rating that should have appeared in the listing for the corresponding Borrower Loan because either PFL inaccurately input data into, or inaccurately applied, the formula for determining the Prosper Rating and, as a result, the interest of the investor is materially and adversely affected. During the year ended December 31, 2023 the Company repurchased $0.3 million of Notes under these circumstances, and has agreed to indemnify additional Notes with an unpaid principal balance of $0.8 million as of December 31, 2023. Regulatory Contingencies PFL accrues for contingencies when a loss from such contingencies is probable and the amount of loss can be reasonably estimated. In determining whether a loss is probable and if it is possible to quantify the amount of the estimated loss, PFL reviews and evaluates its litigation and regulatory matters on at least a quarterly basis in light of potentially relevant factual and legal developments. If PFL determines that an unfavorable outcome is not probable or that the amount of a loss cannot be reasonably estimated, PFL does not accrue for a potential litigation loss. If an unfavorable outcome is probable and PFL can estimate a range of outcomes, PFL records the amount management considers to be the best estimate within the range of potential losses that are both probable and estimable; however, if management cannot quantify the amount of the estimated loss, then PFL records the low end of the range of those potential losses. West Virginia Matter In February 2020, Prosper received a proposed Assurance of Discontinuance (an “AOD”) from the Attorney General of the State of West Virginia (the “WV Attorney General”) requesting that, without in any way admitting that any of its prior practices were in violation of the West Virginia Consumer Credit and Protection Act (the “Consumer Act”), Prosper agree to certain terms and conditions regarding its past and potential future conduct of its business with respect to customers in West Virginia, including a release by the WV Attorney General of any claims it may have related to the matters identified in the AOD. We cannot predict the outcome of the matter and any potential fines or penalties, if any, that may arise from the matter. Further, we are unable to estimate a range of outcomes and as a result no accrual has been made. No loans have been originated through the Prosper platform to West Virginians since June 2016 and the final loan originated through the Prosper platform to a borrower in West Virginia was repaid in October 2021. |
RELATED PARTIES
RELATED PARTIES | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
RELATED PARTIES | RELATED PARTIES Since Prosper’s inception, it has engaged in various transactions with its directors, executive officers and holders of more than 10% of its voting securities, and immediate family members and other affiliates of its directors, executive officers, and 10% stockholders. Prosper believes that all of the transactions described below were made on terms no less favorable to Prosper than could have been obtained from unaffiliated third parties. Prosper’s executive officers, directors who are not executive officers, and certain affiliates participate in its marketplace by placing bids and purchasing Notes. The aggregate amount of the Notes purchased and the income earned by parties deemed to be affiliates and related parties of Prosper for the year ended December 31, 2023 and 2022, as well as the Notes outstanding as of December 31, 2023 and 2022 are summarized below (in thousands): Aggregate Amount of Notes Purchased for the Year Ended December 31, Interest Earned on Notes for the Year Ended December 31, 2023 2022 2023 2022 Executive officers and management $ 47 $ 37 $ 9 $ 7 Directors (excluding executive officers and management) — — 1 1 Total $ 47 $ 37 $ 10 $ 8 Notes Balance as of December 31, 2023 December 31, 2022 Executive officers and management $ 64 $ 52 Directors (excluding executive officers and management) 1 6 Total $ 65 $ 58 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
RELATED PARTIES | RELATED PARTIES Since inception, PFL has engaged in various transactions with its directors, executive officers, PMI, and immediate family members and other affiliates of its directors, executive officers and PMI. PFL believes that all of the transactions described below were made on terms no less favorable to PFL than could have been obtained from unaffiliated third parties. PFL’s executive officers and directors who are not executive officers participate in its marketplace by placing bids and purchasing Notes. The aggregate amount of the Notes purchased and the income earned by parties deemed to be related parties of PFL for the years ended December 31, 2023 and 2022 are summarized below (in thousands): Aggregate Amount of Notes Purchased for the Year Ended December 31, Interest Earned on Notes for the Year Ended December 31, 2023 2022 2023 2022 Executive officers and management $ 30 $ 34 $ 8 $ 7 Directors (excluding executive officers and management) — — — — Total $ 30 $ 34 $ 8 $ 7 The balance of Notes held by officers and directors who are not executive officers are as follows (in thousands): Notes Balance as of December 31, 2023 December 31, 2022 Executive officers and management $ 47 $ 45 Directors (excluding executive officers and management) — — Total $ 47 $ 45 |
POSTRETIREMENT BENEFIT PLANS
POSTRETIREMENT BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2023 | |
Retirement Benefits [Abstract] | |
POSTRETIREMENT BENEFIT PLANS | POSTRETIREMENT BENEFIT PLANS Prosper has a 401(k) plan that covers all employees meeting certain eligibility requirements. The 401(k) plan is designed to provide tax-deferred retirement benefits in accordance with the provisions of Section 401(k) of the Internal Revenue Code. Eligible employees may defer up to 90% of eligible compensation up to the annual maximum as determined by the Internal Revenue Service. Prosper’s contributions to the plan are discretionary. During the years ended December 31, 2023, 2022 and 2021, Prosper contributed $3.0 million |
SIGNIFICANT CONCENTRATIONS
SIGNIFICANT CONCENTRATIONS | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
SIGNIFICANT CONCENTRATIONS | SIGNIFICANT CONCENTRATIONS Prosper is dependent on third party funding sources such as banks, asset managers, investment funds and Warehouse Lines to provide the funds to allow WebBank to originate Borrower Loans that the third party funding sources will later purchase. Of all Borrower Loans originated in the year ended December 31, 2023, four individual third parties purchased 15.1%, 12.5%, 11.9% and 10.7% of all Borrower Loans originated, and the Company’s Warehouse VIEs purchased 8.4% of such loans. For the year ended December 31, 2022, two individual parties purchased 23.4% and 10.4% of all Borrower Loans originated, and the Company’s Warehouse VIEs purchased 13.9% of such loans. These purchases indicate that a significant portion of Prosper’s business is dependent on funding through the Whole Loan Channel, through which 89% a nd 92% of Borrower Loans were originated in the years ended December 31, 2023 and 2022, respectively. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
SIGNIFICANT CONCENTRATIONS | SIGNIFICANT CONCENTRATIONS PFL is dependent on third party funding sources such as banks, asset managers, and investment funds to provide the funds to allow WebBank to originate Borrower Loans that the third party funding sources will later purchase. Of all Borrower Loans originated in the year ended December 31, 2023, four individual third parties purchased 15.1%, 12.5%, 11.9% and 10.7% of such loans, and PMI’s Warehouse VIEs purchased 8.4% of such loans. For the year ended December 31, 2022, two individual parties purchased 23.4% and 10.4% of such loans, and PMI’s Warehouse VIEs purchased 13.9% of such loans. These purchases indicate that a significant portion of PFL’s business is dependent on funding through the Whole Loan Channel, through which 89% |
SEGMENTS
SEGMENTS | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
SEGMENTS | SEGMENTS Starting with the fourth quarter of 2022, the Company realigned its reportable and operating segments to better reflect the nature and materiality of its product offerings. As a result of these changes, the Company now has three reportable and operating segments: Personal Loan, Home Equity and Credit Card. The Company’s Chief Executive Officer, who serves as the chief operating decision maker (“CODM”) evaluates the financial performance of the Company’s segments based upon segment revenues, as well as segment Adjusted Net Revenue and segment Adjusted EBITDA, both non-GAAP profitability measures. Items outside of Adjusted EBITDA are not reported by segment, since they are excluded from the measure of segment profitability reviewed by the CODM. The Company’s CODM does not use segment assets to allocate resources or to assess performance of the segments and, therefore, total segment assets have not been disclosed. The tables below present segment information reconciled to consolidated Total Net Revenue and Net Income (Loss) Before Income Taxes, as well as interest income and expense included in segment Adjusted Net Revenue and Adjusted EBITDA, for the periods indicated (in thousands). Year Ended December 31, 2023 Personal Loan Home Equity Credit Card Total Total Net Revenue $ 100,921 $ 1,875 $ 34,904 $ 137,700 Impact of interest rates on fair value of loans held in consolidated trusts 2,629 — — 2,629 Accelerated amortization of PWIIT debt issuance costs 1,880 — — 1,880 Segment Adjusted Net Revenue $ 105,430 $ 1,875 $ 34,904 $ 142,209 Segment Adjusted EBITDA $ (32,027) $ (2,483) $ 3,882 $ (30,628) Depreciation expense: Origination and Servicing (8,774) General and Administrative (2,108) Amortization of intangibles (107) Stock-based compensation (1,575) Impairment of operating lease right-of-use assets (196) Change in Fair Value of Convertible Preferred Stock Warrants (48,695) Impact of interest rates on fair value of loans held in consolidated trusts (2,629) Interest income on cash and cash equivalents 2,473 Interest Expense on Term Loan (12,265) Accelerated amortization of PWIIT debt issuance costs (1,880) Net Loss Before Income Taxes $ (106,384) Interest Income (Expense) Included in Segment Adjusted EBITDA Interest Income on Borrower Loans and Loans Held for Sale $ 115,663 $ — $ — $ 115,663 Interest Expense on Financial Instruments (91,983) — — (91,983) Total Interest Income, Net $ 23,680 $ — $ — $ 23,680 Year Ended December 31, 2022 Personal Loan Home Equity Credit Card Total Total Net Revenue $ 180,717 $ 2,821 $ 16,343 $ 199,881 Impact of interest rates on fair value of loans held in consolidated trusts 7,248 — — 7,248 Segment Adjusted Net Revenue $ 187,965 $ 2,821 $ 16,343 $ 207,129 Segment Adjusted EBITDA $ 9,301 $ (2,163) $ (8,946) $ (1,808) Depreciation expense: Origination and Servicing (8,132) General and Administrative (2,656) Amortization of intangibles (136) Stock-based compensation (1,326) Change in Fair Value of Convertible Preferred Stock Warrants 84,595 Gain on Forgiveness of PPP Loan 8,604 Impact of interest rates on fair value of loans held in consolidated trusts (7,248) Interest income on cash and cash equivalents 511 Interest Expense on Term Loan (1,527) Net Income Before Income Taxes $ 70,877 Interest Income (Expense) Included in Segment Adjusted EBITDA Interest Income on Borrower Loans and Loans Held for Sale $ 86,350 $ — $ — $ 86,350 Interest Expense on Financial Instruments (60,025) — — (60,025) Total Interest Income, Net $ 26,325 $ — $ — $ 26,325 Year Ended December 31, 2021 Personal Loan Home Equity Credit Card Total Total Net Revenue $ 143,670 $ 946 $ 10 $ 144,626 Impact of interest rates on fair value of loans held in consolidated trusts 3,084 — — 3,084 Segment Adjusted Net Revenue $ 146,754 $ 946 $ 10 $ 147,710 Segment Adjusted EBITDA $ 22,303 $ (2,556) $ (3,849) $ 15,898 Depreciation expense: Organization and Servicing (7,167) General and Administrative (2,501) Amortization of intangibles (172) Stock-based compensation (1,136) Change in Fair Value of Convertible Preferred Stock Warrants (138,622) Loss on Deconsolidation of VIEs (1,494) Impact of interest rates on fair value of loans held in consolidated trusts (3,084) Interest income on cash and cash equivalents 8 Net Loss Before Income Taxes $ (138,270) Interest Income (Expense) Included in Segment Adjusted EBITDA Interest Income on Borrower Loans and Loans Held for Sale $ 83,107 $ — $ — $ 83,107 Interest Expense on Financial Instruments (50,816) — — (50,816) Total Interest Income, Net $ 32,291 $ — $ — $ 32,291 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
SEGMENTS | SEGMENTS PFL’s Chief Executive Officer, who serves as the chief operating decision maker, reviews financial information on a consolidated basis for purposes of allocating resources and evaluating financial performance. As such, the Company has a single reportable and operating segment. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS Management has evaluated subsequent events or transactions occurring through the date the consolidated financial statements were issued and determined that no events or transactions, other than any items disclosed within the consolidated financial statements and related notes, are required to be disclosed herein. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS Management has evaluated subsequent events or transactions occurring through the date the consolidated financial statements were issued and determined that no events or transactions, other than any items disclosed within the consolidated financial statements and related notes, are required to be disclosed herein. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNT POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements include the accounts of PMI and its wholly owned subsidiaries including PFL, Prosper Healthcare Lending LLC (“PHL”), BillGuard, Inc. (“BillGuard”), and its consolidated VIEs including Prosper Warehouse I Trust (“PWIT”), Prosper Warehouse II Trust (“PWIIT,” terminated September 25, 2023), Prosper Marketplace Issuance Trust, Series 2023-1 (“PMIT 2023-1”), and Prosper Grantor Trust (“PGT”). All intercompany balances and transactions between PMI and its subsidiaries have been eliminated in consolidation. PMI and PFL’s financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). PMI did not have any items of other comprehensive income (loss) during any of the periods presented in the consolidated financial statements as of and for the years ended December 31, 2023, 2022 and 2021. Notes Issued by Securitization Trust are notes held by certain third-party investors pursuant to Prosper’s securitization transaction, and are distinguishable from the borrower payment dependent Notes available to investors through the Company’s Note Channel. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures, including contingent liabilities at the date of the financial statements and the reported amounts of revenues and |
Consolidation of Variable Interest Entities | Consolidation of Variable Interest Entities A variable interest entity (VIE) is a legal entity that has either a total equity investment that is insufficient to finance its activities without additional subordinated financial support or whose equity investors lack the characteristics of a controlling financial interest. Prosper’s variable interest arises from contractual, ownership or other monetary interests in the entity, which change with fluctuations in the fair value of the entity’s net assets. A VIE is consolidated by its primary beneficiary, which is the party that has both the power to direct the activities that most significantly impact the VIE’s economic performance, and the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. Prosper consolidates a VIE when it is deemed to be the primary beneficiary. Prosper assesses whether or not it is the primary beneficiary of a VIE on an ongoing basis. |
Transfers of Financial Assets | Transfers of Financial Assets Prosper accounts for transfers of financial assets as sales when it has surrendered control over the transferred assets. Control is generally considered to have been surrendered when the transferred assets have been legally isolated from Prosper, the transferee has the right to pledge or exchange the assets without any significant constraints, and Prosper has not entered into a repurchase agreement, does not hold unconditional call options and has not written put options on the transferred assets. In assessing whether control has been surrendered, Prosper considers whether the transferee would be a consolidated affiliate and the impact of all arrangements or agreements made contemporaneously with, or in contemplation of the transfer, even if they were not entered into at the time of transfer. Prosper measures gain or loss on sale of financial assets as the net proceeds received on the sale less the carrying amount of the loans sold. The net proceeds of the sale include the fair value of any assets obtained or liabilities incurred as part of the transaction, including, but not limited to Servicing Assets, retained securities, and recourse obligations. |
Fair Value Measurement | Fair Value Measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial instruments measured at fair value consist principally of Borrower Loans, Loans Held for Sale (Note 4), Servicing Assets (Note 6), Credit Card Derivative (Note 5), Loan Trailing Fee Liabilities (Note 10), Debt (Note 11) and Convertible Preferred Stock Warrant Liability (Note 13). The estimated fair values of other financial instruments, including Cash and Cash Equivalents, Restricted Cash, Accounts Receivable, Accounts Payable and Accrued Liabilities, and Payable to Investors approximate their carrying values because of their short-term nature. The estimated fair values of the Term Loan and Warehouse Lines (Note 11) do not approximate their carrying values due primarily to differences in the stated and market rates associated with these instruments. The fair value hierarchy includes a three-level classification, which is based on whether the inputs to the valuation methodology used for measurement are observable: Level 1 — Quoted market prices in active markets for identical assets or liabilities. Level 2 — Inputs other than quoted prices included in Level 1 that are observable for the asset or liability either directly or indirectly. Level 3 — Unobservable inputs. When developing fair value measurements, Prosper maximizes the use of observable inputs and minimizes the use of unobservable inputs. However, for certain instruments Prosper must utilize unobservable inputs in determining fair value due to the lack of observable inputs in the market, which requires greater judgment in measuring fair value. In instances where there is limited or no observable market data, fair value measurements for assets and liabilities are determined using assumptions that management believes a market participant would use in pricing the asset or liability. As observable market prices are not available for the Borrower Loans, Loans Held for Sale, Notes, Servicing Assets and Credit Card Derivative, or for similar assets and liabilities, Prosper believes the Borrower Loans, Loans Held for Sale, Notes, Servicing Assets and Credit Card Derivative are considered level 3 financial instruments. Prosper primarily uses a discounted cash flow model to estimate their fair value, and key assumptions used in valuation include default rates and prepayment rates derived from market data and historical performance and discount rates based on estimates of the rates of return that investors would require when investing in financial instruments with similar characteristics. The obligation to pay principal and interest on any series of Notes is equal to the loan payments, if any, that are received on the corresponding Borrower Loan, net of our servicing fee which is 1.0% of the outstanding balance. The fair value election for Notes and Borrower Loans allows both the assets and the related liabilities to receive similar accounting treatment for expected losses which is consistent with the subsequent cash flows to investors that are dependent upon borrower payments. As such, the fair value of a series of Notes is approximately equal to the fair value of the corresponding Borrower Loan, adjusted for the 1.0% servicing fee and the timing of loan purchase, Note issuance and borrower payments. As a result, the valuation of the Notes uses the same methodology and assumptions as the Borrower Loans, except that the Notes incorporate the 1.0% servicing fee and any differences in timing in payments. The effective interest rate associated with a group of Notes is less than the interest rate earned on the corresponding Borrower Loan due to the 1.0% servicing fee. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash includes various unrestricted deposits with investment-grade rated financial institutions. Cash equivalents consist of highly liquid marketable securities with original maturities of three months or less at the time of purchase and consist primarily of money market funds, commercial paper, US treasury securities and US agency securities. Cash equivalents are recorded at cost, which approximates fair value. At times, our cash balances may exceed federally insured amounts and potentially subject the Company to a concentration of credit risk. The Company believes that no significant concentration of credit risk exists with respect to these balances based on its assessment of the creditworthiness of these financial institutions. |
Restricted Cash | Restricted Cash Restricted cash consists primarily of cash deposits, money market funds and short term certificate of deposit accounts held as collateral as required for loan funding and servicing activities, and cash that investors or Prosper have on the marketplace that has not yet been invested in Borrower Loans or disbursed to the investor. |
Borrower Loans, Loans Held for Sale and Notes | Borrower Loans, Loans Held for Sale and Notes Borrower Loans are funded either through the Note Channel or through the Whole Loan Channel. Through the Note Channel, Prosper purchases Borrower Loans from WebBank, then issues Notes and holds the Borrower Loans until maturity. The obligation to repay a series of Notes issued through the Note Channel is dependent upon the repayment of the associated Borrower Loan. Borrower Loans funded and Notes issued through the Note Channel are carried on Prosper’s consolidated balance sheets as assets and liabilities, respectively. Prosper uses Warehouse Lines to purchase Loans Held for Sale that may be subsequently contributed to securitization transactions or sold to investors. Loans Held for Sale are included in “Loans Held for Sale, at Fair Value” on the Consolidated Balance Sheets. See Note 11, Debt, for more details on Warehouse Lines. In September 2023, Prosper closed a securitization transaction (the “PMIT 2023-1 Transaction”) with personal loans previously funded through its PWIIT Warehouse Line. The newly formed securitization entity, PMIT 2023-1, issued notes acquired by third parties and residual certificates acquired by PMI (a majority owned affiliate of PFL, the sole sponsor of the securitization). PMIT 2023-1 is deemed a consolidated VIE, and as a result the Borrower Loans it holds are presented in “Borrower Loans, at Fair Value,” and the notes sold to third-party investors are included in “Notes Issued by Securitization Trust” on the accompanying Consolidated Balance Sheet. See Note 7, Securitizations , for additional disclosures. Borrower Loans and Loans Held for Sale are purchased from WebBank. Prosper places Borrower Loans and Loans Held for Sale on non-accrual status when they are 120 days past due. When a loan is placed on non-accrual status, Prosper stops accruing interest and reverses all accrued but unpaid interest as of such date. Additionally, Prosper charges-off Borrower Loans and Loans Held for Sale when they are 120 days past due. The fair value of loans 120 or more days past due generally consists of the expected recovery from debt sales in subsequent periods. Prosper has elected the fair value option for Borrower Loans, Loans Held for Sale and Notes. Changes in fair value of Borrower Loans funded through the Note Channel are largely offset by the changes in fair value of Notes due to the borrower payment-dependent design of the Notes. Changes in fair value of Loans Held for Sale are recorded through Proper's earnings and Prosper collects interest on Loans Held for Sale. Changes in the fair values of Borrower Loans, Loans Held for Sale and Notes are included in Change in Fair Value of Financial Instruments on the accompanying Consolidated Statements of Operations. |
Credit Card Derivative | Credit Card Derivative The Company evaluated the terms of the Credit Card program agreement (the “Credit Card Program Agreement”) with Coastal Community Bank (“Coastal”) and determined that it contained features that met the definition of derivatives under Accounting Standards Codification (“ASC”) 815, Derivatives and Hedging . These features are freestanding financial instruments (as defined under ASC 480, Distinguishing Liabilities from Equity ), and have been valued separately as derivatives. A right of offset exists between the derivatives, and they are presented net on the accompanying consolidated balance sheets. Changes in the fair value of the Credit Card Derivative, as well as settled transactions from the Credit Card portfolio, are recorded in Change in Fair Value of Financial Instruments on the accompanying Consolidated Statements of Operations. In August 2023, the Company executed an amendment to the Credit Card Program Agreement that, among other things, (a) increased the maximum outstanding Credit Card principal balance for Prosper Allocations from $200 million to $300 million, (b) funded a cash reserve account in the name of Coastal in connection with charge-off losses on receivables allocated to Prosper, and (c) clarified various items from the original program agreement. As a result of (b), the Company reclassified approximately $9.3 million in Restricted Cash held in the reserve account to Prepaid and Other Assets on the accompanying Consolidated Balance Sheets. |
Servicing Assets | Servicing Assets Prosper records Servicing Assets at their estimated fair values for servicing rights retained when Prosper sells Borrower Loans to unrelated third-party buyers. The change in fair value of Servicing Assets is recognized in Servicing Fees, Net. The gain or loss on a loan sale is recorded in (Loss) Gain on Sale of Borrower Loans while the fair value of the servicing rights, which is based on the degree to which the contractual loan servicing fee is above or below an estimated market servicing rate is recorded in Servicing Assets on the Consolidated Balance Sheets. Prosper uses a discounted cash flow model to estimate the fair value of the loan Servicing Assets which considers the contractual servicing fee revenue that Prosper earns on the Borrower Loans, the estimated market servicing rates to service such loans, the prepayment rates, the default rates and the current principal balances of the Borrower Loans. |
Property and Equipment | Property and Equipment Property and Equipment consists of computer equipment, office furniture and equipment, leasehold improvements, software purchased or developed for internal use and web site development costs. Property and Equipment is stated at cost, less accumulated depreciation and amortization, and is computed using the straight-line method based upon estimated useful lives of the assets. Estimated useful lives of the assets are as follows: Furniture and fixtures 7 years Office equipment 5 years Computers and equipment 3 years Leasehold improvements 5 - 8 years Software and website development costs 1 - 5 years The costs to develop software for the website and other internal uses are capitalized when management has authorized and committed project funding, when preliminary development efforts are successfully completed, and when it is probable that the project will be completed, and the software will be used as intended. Capitalized software and website development costs primarily include software licenses acquired, fees paid to outside consultants and salaries and payroll-related costs for employees directly involved in the development efforts. Costs incurred prior to meeting these criteria, together with costs incurred for training and maintenance, are expensed. Costs incurred for upgrades and enhancements that are considered to be probable to result in additional functionality are capitalized. Capitalized costs are included in Property and Equipment and amortized to expense using the straight-line method over their expected lives. Software and website development assets are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. The recoverability of software and website development assets to be held and used is measured by a comparison of the carrying amount of the asset group to the future net undiscounted cash flows expected to be generated by the asset group. If such software and website development assets are considered to be impaired, the impairment to be recognized is the excess of the carrying amount over the fair value of the software and website development asset group. |
Leases | Leases Management determines if an arrangement is a lease at inception. Operating lease right-of-use (“ROU”) assets and operating lease liabilities are included on the Consolidated Balance Sheets in Property and Equipment, Net and in Other Liabilities, respectively. For certain leases with original terms of twelve months or less, PMI recognizes the lease expense as incurred and does not record ROU assets and lease liabilities. If a contract contains a lease, management evaluates whether it should be classified as an operating or finance lease. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. As most of PMI's leases do not provide an implicit rate, management uses an incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The operating lease ROU assets are evaluated for impairment utilizing the same impairment model used for Property and Equipment. |
Goodwill and Intangibles | Goodwill and Intangibles Goodwill associated with business combinations is computed by recognizing the portion of the purchase price that is not tied to individually identifiable and separately recognizable assets. Goodwill is assigned to the Company’s reporting units at the acquisition date according to the expected economic benefits that the acquired business will provide to the reporting unit. A reporting unit is a business operating segment or a component of a business operating segment. The Company identifies its reporting units based on how the operating segments and reporting units are managed. Accordingly, the Company allocated the entire balance of goodwill to the Personal Loan reportable and operating segment. Refer to Note 21 for further information on the Company’s reportable and operating segments. Goodwill is not amortized but is tested for impairment annually or whenever indications of impairment exist. Annual impairment testing occurs on October 1. Impairment exists whenever the carrying value of Goodwill exceeds its implied fair value. Adverse changes in impairment indicators such as loss of key personnel, increased regulatory oversight or unplanned changes in operations could result in impairment. Costs of internally developing any intangibles is expensed as incurred. Intangible Assets identified through the acquisitions of American Healthcare Lending and BillGuard include customer relationships, technology and a brand name. The user base and customer relationship Intangible Assets are being amortized on an accelerated basis over a three three |
Payable to Investors | Payable to Investors Payable to Investors primarily represents the obligation to investors related to cash held in an account for the benefit of investors and payments-in-process received from borrowers. |
Term Loan | Term Loan Prosper entered into a Credit Agreement, which provided for a Term Loan with a third-party financial institution in November 2022, which is more fully described in Note 11. This Term Loan is carried at amortized cost, net of discounts and issuance costs, which are subsequently amortized to Interest Expense on Term Loan over the life of the underlying agreement. Interest Expense on Term Loan is presented as a component of Expenses on the accompanying Consolidated Statements of Operations, except for any portion associated with Term Loan proceeds used to purchase Loans Held for Sale through the Company’s Warehouse Lines, which is presented in Interest Expense on Financial Instruments as a component of Net Interest Income on the accompanying Consolidated Statement of Operations. |
Warehouse Lines | Warehouse Lines Warehouse Lines are carried at amortized cost. Prosper defers specific incremental costs directly related to entering into the Warehouse Lines and subsequently amortizes them into interest expense over the life of the arrangements. |
Convertible Preferred Stock Warrant Liability | Convertible Preferred Stock Warrant Liability Prosper has entered into varying arrangements with investors to issue preferred stock warrants in exchange for their participation as a purchaser of Borrower Loans. In all cases, these warrants are free standing financial instruments due to their status as legally detached and separately exercisable warrants without conditions requiring Prosper to repurchase those warrants or the underlying preferred shares. These freestanding warrants are accounted for in accordance with ASC 480, Distinguishing Liabilities from Equity . Under ASC 480, vested freestanding warrants to purchase the Company’s convertible redeemable preferred stock are classified as a liability on the Consolidated Balance Sheets and carried at fair value because the warrants may conditionally obligate the Company to transfer assets at some point in the future. The Company records the warrants at fair value on issuance. The warrants are subject to remeasurement to fair value at each balance sheet date, and any change in their fair value is recognized as “Change in Fair Value of Convertible Preferred Stock Warrants” in the Consolidated Statements of Operations. The Company will continue to adjust the liability for changes in fair value until the earlier of the exercise or expiration of the warrants, the completion of a deemed liquidation event or the conversion of convertible redeemable preferred stock into Common Stock. |
Loan Trailing Fee Liability | Loan Trailing Fee Liability On July 1, 2016, Prosper signed a series of agreements with WebBank which, among other things, includes an additional program fee (the “Loan Trailing Fee”) paid to WebBank in connection with the performance of each loan sold to Prosper. These agreements became effective as of August 1, 2016. The Loan Trailing Fee is dependent on the amount and timing of principal and interest payments made by borrowers of the underlying loans, irrespective of whether the loans are sold by Prosper, and gives WebBank an ongoing financial interest in the performance of the loans it originates. This fee is paid by Prosper to WebBank over the term of the respective loans and is a function of the principal and interest payments made by borrowers of such loans. In the event that principal and interest payments are not made with respect to any loan, Prosper is not required to make the related Loan Trailing Fee payment. The obligation to pay the Loan Trailing Fee for any loan sold to Prosper is recorded at fair value at the time of the origination of such loan within Other Liabilities and recorded as a reduction of “Transaction Fees, net”. Any changes in the fair value of this liability are recorded in “Servicing Fees, Net” on the Consolidated Statements of Operations. The fair value of the Loan Trailing Fee represents the present value of the expected monthly Loan Trailing Fee payments, which takes into consideration certain assumptions related to expected prepayment rates and defaults rates. |
Revenue Recognition | Revenue Recognition Revenue primarily results from Transaction and Servicing Fees and Net Interest Income earned. Fees include Transaction Fees for our services performed on behalf of WebBank to originate a loan, as well as program fees and broker fees generated from our Credit Card product and Home Equity Products, respectively. PMI also has other smaller sources of revenue reported as Other Revenues, including referral and incentive fees. Transaction Fees Prosper has a customer contract with WebBank to facilitate the origination of all Borrower Loans through Prosper’s marketplace. In exchange for these services, Prosper earns a transaction fee from WebBank that is recognized when performance is complete and upon the successful origination of a Borrower Loan. The transaction fee Prosper earns is determined by the term and credit grade of the Borrower Loan that is facilitated on Prosper’s marketplace, and ranges from 1.00% to 7.99% of the original principal amount of each Borrower Loan that WebBank originates. Prosper records the transaction fee net of any fees paid to WebBank because Prosper does not receive an identifiable benefit from WebBank other than the borrower loan that has been recognized at fair value. Additionally, the Company assumes WebBank’s obligation under Utah law to refund the pro-rated amount of the transaction fee in excess of 5% in the event of a borrower prepayment of the loan in full before maturity. Actual and expected refunds are recorded as a reduction of “Transaction Fees, Net” on the Company’s Consolidated Statements of Operations, and are included in “Accounts Payable and Accrued Liabilities” on the Company’s Consolidated Balance Sheets (Note 17). The Company also generates various Credit Card program fees through its partnership with Coastal. These include interchange fees, annual fees and late fees, which compensate Prosper for its role in marketing and growing the Credit Card product. Interchange and late fees are recognized as they are generated each month, while annual fees received are deferred and recognized over the annual period to which they relate. Additionally, the Company generates broker fees on Home Equity Products through its partnerships with its Home Lending Partners. Servicing Fees Investors who purchase Borrower Loans from Prosper typically pay Prosper a servicing fee which is generally set at 1.0% pe r annum of the outstanding principal balance of the borrower loan prior to applying the current payment, plus an additional 0.075% per annum to cover the Loan Trailing Fee. The servicing fee compensates Prosper for the costs incurred in servicing the borrower loan, including managing payments from borrowers, managing payments to investors and maintaining investors’ account portfolios. Prosper records Servicing Fees from investors as a component of operating revenue when received. Under the Credit Card program agreement, Prosper is responsible for servicing the entire underlying Credit Card portfolio. Coastal pays the Company a 1% per annum servicing fee on the daily outstanding balance of receivables designated as Coastal Allocations. To the extent these servicing fees do not exceed the market servicing rate a market participant would require to service the entire Credit Card portfolio, the Company records a servicing obligation liability and measures it at fair value throughout the servicing period. Changes in the fair value of the servicing obligation liability are recorded in Servicing Fees. (Loss) Gain on Sale of Borrower Loans Prosper recognizes gains or losses on the sale of Borrower Loans when it sells Borrower Loans to third parties. Prosper measures gain or loss on sale of Borrower Loans as the net proceeds received on a sale less the fair value of the Borrower Loans sold. The net proceeds of the sale represent the fair value of any assets obtained or liabilities incurred as part of the transaction, including, but not limited to Servicing Assets, retained securities, repurchase obligations and any incentives provided or received at the time of sale. Interest Income on Borrower Loans and Loans Held for Sale and Interest Expense on Financial Instruments Prosper recognizes interest income on Borrower Loans and Loans Held for Sale using the accrual method based on the stated interest rate to the extent we believe it to be collectible. We record interest expense on the corresponding Notes, at Fair Value, Notes Issued by Securitization Trust and Warehouse Lines based on the contractual interest rates. Other Revenues Other Revenues consist primarily of credit referral fees. These fees are earned from partner companies for the referral of customers on the Company’s platform. The transaction price is a fixed amount per referral and is recognized by the Company upon a successful referral. Other revenues also include incentive fees earned from partner companies through established incentive programs and miscellaneous net fees related to the Company’s Credit Card program. |
Advertising Costs | Advertising Costs |
Stock-Based Compensation | Stock-Based Compensation Management determines the fair value of the Company's stock options issued to employees on the date of grant using the Black-Scholes option pricing model, which is impacted by the fair value of Common Stock as well as by changes in assumptions that include, but are not limited to, the expected Common Stock price volatility over the term of the option awards, the expected term of the awards, risk-free interest rates and the expected dividend yield. PMI recognizes compensation expense for stock-based awards on a straight-line basis over the period during which an employee is required to provide services in exchange for the award (the vesting period of the award). Stock-based compensation expense is recognized only for those awards expected to vest. PMI estimates future forfeitures at the date of grant and revises the estimates, if necessary, in subsequent periods if actual forfeitures differ from estimates. Stock-based awards issued to non-employees are marked-to-market up until the point that the awards measurement period has been achieved. Compensation expense for stock options issued to non-employees is calculated using the Black-Scholes option pricing model and is recorded over the vesting period of the award. |
Income Taxes | Income Taxes The asset and liability method is used to account for income taxes. Under this method, deferred income tax assets and liabilities are based on the differences between the financial statement carrying values and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Prosper’s policy is to include interest and penalties related to gross unrecognized tax benefits within its provision for income taxes. U.S. Federal, California and other state income tax returns are filed. Prosper is not currently undergoing any income tax examinations. Due to the cumulative net operating loss, generally all tax years remain open. Prosper recognizes benefits from uncertain tax positions only if management believes that it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon settlement. |
Other Income, Net | Other Income, Net |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Standards Issued, to be Adopted by the Company in Future Periods In March 2020, the FASB issued Accounting Standards Update (“ASU”) No. 2020-04, “Reference Rate Reform (Topic 848),” which provides optional expedients and exceptions for applying GAAP on contract modifications and hedge accounting, in order to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative referenced rates, such as the Secured Overnight Financing Rate. The optional guidance, which became effective on March 12, 2020, could be applied through December 31, 2022. In December 2022, the FASB issued No 2022-06 extending the sunset date of the relief provided under ASU No. 2020-04 to December 31, 2024. The Company amended its agreements and transitioned to SOFR for contracts that previously referenced LIBOR. The Company continues to evaluate potential future impacts that may result from the discontinuation of LIBOR or other reference rates as well as the accounting provided in this update on our financial condition, results of operations, and cash flows . In October 2023, the FASB issued ASU No. 2023-06, “Disclosure Improvements: Codification Amendments in Response to the Securities and Exchange Commission’s Disclosure Update and Simplification Initiative”. The amendments in this update modify the disclosure or presentation requirements of a variety of Topics in the ASC in response to the SEC’s Release No. 33-10532, “Disclosure Update and Simplification Initiative”, and align the ASC’s requirements with the SEC’s regulations. The effective date for each amendment will be the date on which the SEC's removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective. However, if by June 30, 2027, the SEC has not removed the related disclosure from its regulations, the amendments will be removed from the Codification and not become effective. Early adoption is prohibited. The Company does not expect the adoption of this ASU to have a material impact on the Company’s consolidated financial statements and related disclosures. In November 2023, the FASB issued ASU No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures”, which updates reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses. The amendments are effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The amendments should be applied retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating this ASU to determine its impact on the Company’s disclosures. In December 2023, the FASB issued ASU No. 2023-09, “I ncome Taxes (Topic 740): Improvements to Income Tax Disclosures”, which enhances effective tax rate reconciliation disclosure requirements and provides clarity to the disclosures of income taxes paid, income before taxes and provision for income taxes. The amendments are effective for fiscal years beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments in this update should be applied on a prospective basis. Retrospective application is permitted. The Company is currently evaluating this ASU to determine its impact on the Company’s disclosures. Other recent accounting pronouncements issued by the FASB did not, or are not believed by management to, have a material impact on the Company’s present or future financial statements. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Basis of Presentation | Basis of Presentation PFL’s consolidated financial statements include the accounts of PFL and its wholly-owned subsidiary, Prosper Depositor LLC. All intercompany balances and transactions between PFL and Prosper Depositor LLC have been eliminated in consolidation. PFL’s financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). |
Use of Estimates | Use of Estimates The preparation of PFL’s consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. These estimates, judgments and assumptions include, but are not limited to, the following: valuation of Loans Held for Sale, Borrower Loans and associated Notes, valuation of servicing rights, valuation of loan trailing fee liability, repurchase obligations, and contingent liabilities. PFL bases its estimates on historical experience from all Borrower Loans and on various other assumptions that it believes to be reasonable under the circumstances. Actual results could differ materially from estimates. |
Consolidation of Variable Interest Entities | Consolidation of Variable Interest Entities A variable interest entity (VIE) is a legal entity that has either a total equity investment that is insufficient to finance its activities without additional subordinated financial support or whose equity investors lack the characteristics of a controlling financial interest. PFL’s variable interest arises from contractual, ownership or other monetary interests in the entity, which change with fluctuations in the fair value of the entity’s net assets. A VIE is consolidated by its primary beneficiary, which is the party that has both the power to direct the activities that most significantly impact the VIE’s economic performance, and the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. PFL consolidates a VIE when it is deemed to be the primary beneficiary. PFL assesses whether or not it is the primary beneficiary of a VIE on an ongoing basis. |
Transfers of Financial Assets | Transfers of Financial Assets PFL accounts for transfers of financial assets as sales when it has surrendered control over the transferred assets. Control is generally considered to have been surrendered when the transferred assets have been legally isolated from PFL, the transferee has the right to pledge or exchange the assets without any significant constraints, and PFL has not entered into a repurchase agreement, does not hold unconditional call options and has not written put options on the transferred assets. In assessing whether control has been surrendered, PFL considers whether the transferee would be a consolidated affiliate and the impact of all arrangements or agreements made contemporaneously with, or in contemplation of the transfer, even if they were not entered into at the time of transfer. PFL measures gain or loss on sale of financial assets as the net proceeds received on the sale less the carrying amount of the loans sold. The net proceeds of the sale represent the fair value of any assets obtained or liabilities incurred as part of the transaction, including, but not limited to Servicing Assets, retained securities, and recourse obligations. |
Fair Value Measurement | Fair Value Measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial instruments consist principally of Cash and Cash Equivalents, Restricted Cash, Borrower Loans, Loans Held for Sale, Servicing Assets, Loan Trailing Fee Liability, Accounts Receivable, Accounts Payable and Accrued Liabilities, Payable to Investors and Notes. The estimated fair values of Cash and Cash Equivalents, Restricted Cash, Accounts Receivable, Accounts Payable and Accrued Liabilities, and Payable to Investors approximate their carrying values because of their short term nature. The fair value hierarchy includes a three-level classification, which is based on whether the inputs to the valuation methodology used for measurement are observable: Level 1 — Quoted market prices in active markets for identical assets or liabilities. Level 2 — Inputs other than quoted prices included in Level 1 that are observable for the asset or liability either directly or indirectly. Level 3 — Unobservable inputs. When developing fair value measurements, PFL maximizes the use of observable inputs and minimizes the use of unobservable inputs. However, for certain instruments PFL must utilize unobservable inputs in determining fair value due to the lack of observable inputs in the market, which requires greater judgment in measuring fair value. In instances where there is limited or no observable market data, fair value measurements for assets and liabilities are determined using assumptions that management believes a market participant would use in pricing the asset or liability. As observable market prices are not available for the Borrower Loans, Loans Held for Sale, Notes, and Servicing Assets, or for similar assets and liabilities, PFL believes the Borrower Loans, Loans Held for Sale, Notes, and Servicing Assets should be considered Level 3 financial instruments. PFL primarily uses a discounted cash flow model to estimate their fair value and key assumptions used in valuation include default rates and prepayment rates derived from historical performance and discount rates based on estimates of the rates of return that investors would require when investing in financial instruments with similar characteristics. |
Cash and Cash Equivalents | Cash and Cash Equivalents |
Restricted Cash | Restricted Cash Restricted Cash consists primarily of cash deposits, money market funds and short-term certificate of deposit accounts held as collateral as required for long term leases, loan funding and servicing activities, and cash that investors have on our marketplace that has not yet been invested in Borrower Loans or disbursed to the investor. |
Borrower Loans, Loans Held for Sale and Notes | Borrower Loans, Loans Held for Sale and Notes With respect to the Note Channel, PFL purchases Borrower Loans from WebBank, then issues Notes and holds the Borrower Loans until maturity. The obligation to repay a series of Notes funded through the Note Channel is dependent upon the repayment of the associated Borrower Loan. Borrower Loans and Notes funded through the Note Channel are carried on PFL’s consolidated balance sheets as assets and liabilities, respectively. PFL places Borrower Loans and Loans Held for Sale on non-accrual status when they are 120 days past due. When a loan is placed on non-accrual status, PFL stops accruing interest and reverses all accrued but unpaid interest as of such date. Additionally, PFL charges-off Borrower Loans and Loans Held for Sale when they are 120 days past due. The fair value of loans 120 days past due generally consists of the expected recovery from debt sales in subsequent periods. Management has elected the fair value option for Borrower Loans, Loans Held for Sale, and Notes. Changes in fair value of Borrower Loans are largely offset by the changes in fair value of Notes due to the borrower payment-dependent design of the Notes. Changes in fair value of Borrower Loans, Loans Held for Sale and Notes are included in “Change in Fair Value of Financial Instruments, Net” on the Consolidated Statements of Operations. PFL primarily uses a discounted cash flow model to estimate the fair value of Borrower Loans, Loans Held for Sale and Notes. The key assumptions used in the valuation include default rates and prepayment rates derived primarily from historical performance and discount rates based on estimates of the rates of return that investors would require when investing in financial instruments with similar characteristics. |
Servicing Assets | Servicing Assets PFL records Servicing Assets at their estimated fair values for servicing rights retained when PFL sells Borrower Loans to unrelated third-party buyers. The change in fair value of Servicing Assets is recognized in revenue as Servicing Fees, Net. The gain or loss on a loan sale is recorded in Loss (Gain) on Sale of Borrower Loans while the fair value of the servicing rights, which is based on the degree to which the contractual loan servicing fee is above or below an estimated market loan servicing rate, is recorded in Servicing Assets on the Consolidated Balance Sheets. |
Software and Website Development | Software and Website Development Software and website development represents the software and website development costs that PMI transferred to PFL. PFL does not develop any of its own software or its website. Software and website development are included in Property and Equipment, Net and amortized to expense using the straight-line method over their expected lives which is generally one |
Payable to Investors | Payable to Investors Payable to Investors primarily represents the Company's obligation to investors related to cash held in an account for the benefit of investors and payments-in-process received from borrowers. |
Loan Trailing Fee Liability | Loan Trailing Fee Liability On July 1, 2016, PMI signed a series of agreements with WebBank which, among other things, includes an additional program fee (the “Loan Trailing Fee”) paid to WebBank in connection with the performance of each loan sold to PMI. These agreements were effective as of August 1, 2016. The Loan Trailing Fee is dependent on the amount and timing of principal and interest payments made by borrowers of the underlying loans, irrespective of whether the loans are sold by PMI, and gives WebBank an ongoing financial interest in the performance of the loans it originates. This fee is paid by PMI to WebBank over the term of the respective loans and is a function of the principal and interest payments made by borrowers of such loans. In the event that principal and interest payments are not made with respect to any loan, PMI is not required to make the related Loan Trailing Fee payment. The obligation to pay the Loan Trailing Fee for any loan sold to PMI is recorded at fair value at the time of the origination of such loan within Other Liabilities and recorded as a reduction of “Transaction Fees, net”. Any changes in the fair value of this liability are recorded in “Servicing Fees, Net” on the Consolidated Statements of Operations. The fair value of the Loan Trailing Fee represents the present value of the expected monthly Loan Trailing Fee payments, which takes into consideration certain assumptions related to expected prepayment rates and defaults rates. |
Revenue Recognition | Revenue Recognition Revenue primarily results from fees, net interest earned and gains on the sale of Borrower Loans. Fees consist of related party administrative fees and Servicing Fees paid by investors. The Company also has other smaller sources of revenue reported as Other Revenues including fees charged in relation to securitizations by outside investors. Administration Agreement License Fees PFL primarily generates revenues through license fees it earns through an Administration Agreement with PMI. The Administration Agreement contains a license granted by PFL to PMI that entitles PMI to use the platform for and in relation to: (i) PMI’s performance of its duties and obligations under the Administration Agreement relating to corporate administration, loan platform services, loan and Note servicing and marketing, and (ii) PMI’s performance of its duties and obligations to WebBank in relation to loan origination and funding. The license fees are based on the number of listings that are posted to the platform. Servicing Fees Investors who purchase Borrower Loans from PFL through the Whole Loan Channel typically pay PFL a servicing fee which is currently set at 1.0% per annum of the outstanding principal balance of the Borrower Loan prior to applying the current payment , plus an additional 0.075% per annum to cover the Loan Trailing Fee . The servicing fee com pensates PFL for the costs incurred in servicing the Borrower Loan, including managing payments from borrowers, managing payments to investors and maintaining investors’ account portfolios. PFL records Servicing Fees from investors as a component of operating revenue when received. Loss (Gain) on Sale of Borrower Loans PFL recognizes gains or losses on the sale of Borrower Loans when it sells Borrower Loans to third parties. PFL measures gain or loss on sale of Borrower Loans as the net proceeds received on the sale less the fair value of the Borrower Loans sold. The net proceeds of the sale represent the fair value of any assets obtained or liabilities incurred as part of the transaction, including, but not limited to Servicing Assets, retained securities, and repurchase obligations. Interest Income on Borrower Loans and Interest Expense on Notes PFL recognizes interest income on Borrower Loans originated through the Note Channel and interest expense on the corresponding Notes using the accrual method based on the stated interest rate to the extent PFL believes it to be collectable. |
Administration Fee Expense - Related Party | Administration Fee Expense - Related Party |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Standards Adopted in the Current Period No accounting standards were adopted in the current period for PFL. Accounting Standards Issued, to be Adopted in Future Periods No issued and pending accounting standards were identified that are expected to have an impact on PFL. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNT POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Useful Lives of Assets | Estimated useful lives of the assets are as follows: Furniture and fixtures 7 years Office equipment 5 years Computers and equipment 3 years Leasehold improvements 5 - 8 years Software and website development costs 1 - 5 years |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
Schedule of Property and Equipment | Property and Equipment, Net consists of the following at the dates presented (in thousands): December 31, 2023 2022 Internal-use software and website development costs $ 58,423 $ 49,818 Operating lease right-of-use assets 22,655 27,051 Computer equipment 10,466 13,444 Office equipment and furniture 2,936 2,810 Leasehold improvements 6,827 7,157 Assets not yet placed in service 9,953 5,877 Property and equipment 111,260 106,157 Less: Accumulated depreciation and amortization (70,371) (67,343) Total Property and Equipment, Net $ 40,889 $ 38,814 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Schedule of Property and Equipment | Property and Equipment consist of the following as of the dates presented (in thousands): December 31, 2023 2022 Internal-use software and web site development costs $ 43,619 $ 37,428 Less: Accumulated depreciation and amortization (31,978) (27,424) Total Property and Equipment, Net $ 11,641 $ 10,004 |
BORROWER LOANS, LOANS HELD FO_2
BORROWER LOANS, LOANS HELD FOR SALE AND NOTES, AT FAIR VALUE (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
Schedule of Borrower Loans, Notes and Loans Held for Sale | As of December 31, 2023 and 2022, Borrower Loans, Loans Held for Sale and Notes were as follows (in thousands): Borrower Loans Loans Held for Sale Notes 2023 2022 2023 2022 2023 2022 Aggregate principal balance outstanding $ 577,029 $ 333,294 $ 170,925 $ 512,076 $ 345,341 $ 336,555 Fair value adjustments (31,991) (12,652) (9,424) (12,311) (23,375) (17,851) Fair value $ 545,038 $ 320,642 $ 161,501 $ 499,765 $ 321,966 $ 318,704 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Schedule of Borrower Loans, Notes and Loans Held for Sale | The aggregate principal balances outstanding and fair values of Borrower Loans and Notes as of December 31, 2023 and 2022, are presented in the following table (in thousands): Borrower Loans Notes December 31, 2023 December 31, 2022 December 31, 2023 December 31, 2022 Aggregate principal balance outstanding $ 342,791 $ 333,294 $ 345,341 $ 336,555 Fair value adjustments (18,480) (12,652) (23,375) (17,851) Fair value $ 324,311 $ 320,642 $ 321,966 $ 318,704 |
FAIR VALUE OF ASSETS AND LIAB_2
FAIR VALUE OF ASSETS AND LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
Schedule of Fair Value Hierarchy for Assets and Liabilities Measured at Fair Value | The following tables present the fair value hierarchy for assets and liabilities measured at fair value (in thousands): Balance at December 31, 2023 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans, at Fair Value $ — $ — $ 545,038 $ 545,038 Loans Held for Sale, at Fair Value — — 161,501 161,501 SOFR rate swaption (Note 11) — 90 — 90 Servicing Assets — — 12,249 12,249 Credit Card Derivative (Note 5) — — 36,848 36,848 Total Assets $ — $ 90 $ 755,636 $ 755,726 Liabilities: Notes, at Fair Value $ — $ — $ 321,966 $ 321,966 Convertible Preferred Stock Warrant Liability — — 215,041 215,041 Loan Trailing Fee Liability (Note 10) — — 2,942 2,942 Credit Card servicing obligation liability (Note 5) — — 9,732 9,732 Total Liabilities $ — $ — $ 549,681 $ 549,681 Balance at December 31, 2022 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans, at Fair Value $ — $ — $ 320,642 $ 320,642 Loans Held for Sale, at Fair Value — — 499,765 499,765 LIBOR rate swaption — 1,289 — 1,289 Servicing Assets — — 12,562 12,562 Credit Card Derivative (Note 5) — — 10,782 10,782 Total Assets $ — $ 1,289 $ 843,751 $ 845,040 Liabilities: Notes, at Fair Value $ — $ — $ 318,704 $ 318,704 Convertible Preferred Stock Warrant Liability — — 166,346 166,346 Loan Trailing Fee Liability (Note 10) — — 3,290 3,290 Credit Card servicing obligation liability (Note 5) — — 3,720 3,720 Total Liabilities $ — $ — $ 492,060 $ 492,060 |
Schedule of Quantitative Information About Significant Unobservable Inputs | The following tables present quantitative information about the ranges of significant unobservable inputs used for the Company’s Level 3 fair value measurements at December 31, 2023 and 2022: December 31, 2023 2022 Borrower Loans, Loans Held for Sale, and Notes: Discount rate 5.4 % — 8.1 % 5.4 % — 13.2 % Default rate 3.2 % — 23.6 % 1.8 % — 18.7 % At December 31, 2023 and 2022, the discounted cash flow methodology used to estimate the Note fair values used the same projected cash flows as the related Borrower Loans. December 31, 2023 2022 Servicing Assets: Discount rate 15.0 % — 25.0 % 15.0 % — 25.0 % Default rate 2.8 % — 23.6 % 2.0 % — 19.3 % Prepayment rate 6.1 % — 30.6 % 14.2 % — 28.0 % Market servicing rate (1) (2) 0.633 % — 0.842 % 0.648 % — 0.842 % (1) Servicing assets associated with loans enrolled in a relief program offered by the Company as of December 31, 2023 were measured using a market servicing rate assumption of 84.2 basis points. This rate was estimated using a multiplier consistent with observable market rates for other loan types, applied to the base market servicing rate assumption. (2) Excludes collection fees that would be passed on to a hypothetical third-party servicer. As of December 31, 2023 and 2022, the market rate for collection fees and non-sufficient fund fees was assum ed to be 5 basis po ints and 6 basis points, respectively, for a weighted-average total market servicing rate of 68.3 basis points to 89.2 basis points and 70.8 basis points to 90.2 basis points, respectively. December 31, 2023 2022 Loan Trailing Fee Liability: Discount rate 15.0 % — 25.0 % 15.0 % — 25.0 % Default rate 2.8 % — 23.6 % 2.0 % — 19.3 % Prepayment rate 6.1 % — 30.6 % 14.2 % — 28.0 % |
Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following table presents additional information about Level 3 Borrower Loans, Loans Held for Sale and Notes measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in thousands): Assets Liabilities Borrower Loans Held Notes Total Fair Value at January 1, 2022 $ 267,626 $ 243,170 $ (265,985) $ 244,811 Purchase of Borrower Loans/Issuance of Notes 284,921 3,063,729 (285,115) 3,063,535 Principal repayments (187,599) (184,090) 202,308 (169,381) Borrower Loans sold to third parties (14,520) (2,599,881) — (2,614,401) Other changes 650 1,804 (742) 1,712 Change in fair value (30,436) (24,967) 30,830 (24,573) Fair Value at December 31, 2022 $ 320,642 $ 499,765 (318,704) 501,703 Purchase of Borrower Loans/Issuance of Notes 232,306 1,921,129 (231,520) 1,921,915 Principal repayments (217,485) (214,880) 188,670 (243,695) Borrower Loans sold to third parties (4,595) (1,743,287) — (1,747,882) Other changes 2,906 (2,306) (815) (215) Change in fair value (48,387) (39,269) 40,403 (47,253) Transfer of Loans Held for Sale to Borrower Loans upon PMIT 2023-1 Transaction, at Fair Value 259,651 (259,651) — — Fair Value at December 31, 2023 $ 545,038 $ 161,501 $ (321,966) $ 384,573 |
Schedule of Servicing Assets and Liabilities Measured at Fair Value | The following table presents additional information about the Level 3 Servicing Assets measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in thousands): Servicing Assets Fair Value at January 1, 2022 $ 8,761 Additions 12,957 Less: Change in fair value (9,156) Fair Value at December 31, 2022 $ 12,562 Additions 9,238 Less: Change in fair value (9,551) Fair Value at December 31, 2023 $ 12,249 The following table presents additional information ab out the Level 3 Credit Card Derivative measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in tho usands): Credit Card Derivative Fair Value at January 1, 2022 $ 7 Change in fair value 9,784 Net gains from settled transactions 4,295 Less: Net payments made (3,304) Fair Value at December 31, 2022 $ 10,782 Change in fair value 26,066 Net losses from settled transactions (561) Less: Net payments made 561 Fair Value at December 31, 2023 $ 36,848 The following table presents additional information ab out the Level 3 Credit Card servicing obligation liability measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in tho usands). Credit Card Servicing Obligation Liability Fair Value at January 1, 2022 $ — Change in fair value 3,720 Fair Value at December 31, 2022 $ 3,720 Change in fair value 6,012 Fair Value at December 31, 2023 $ 9,732 The following table presents additional information about the Level 3 Convertible Preferred Stock Warrant Liability measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in thousands): Convertible Preferred Stock Warrant Liability Fair Value at January 1, 2022 $ 250,941 Change in fair value (84,595) Fair Value at December 31, 2022 $ 166,346 Change in fair value 48,695 Fair Value at December 31, 2023 $ 215,041 |
Schedule of Level 3 Liabilities Measured on Recurring Basis | The following table presents additional information about Level 3 Loan Trailing Fee Liability measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in thousands): Loan Trailing Fee Liability Balance at January 1, 2022 $ 2,161 Issuances 3,070 Cash payment of Loan Trailing Fee (2,245) Change in fair value 304 Balance at December 31, 2022 $ 3,290 Issuances 2,011 Cash payment of Loan Trailing Fee (2,791) Change in fair value 432 Balance at December 31, 2023 $ 2,942 |
Schedule of Fair Value Assumptions | Key economic assumptions and the sensitivity of the fair value to immediate changes in those assumptions at December 31, 2023 and 2022 for Borrower Loans and Loans Held for Sale are presented in the following table (in thousands, except percentages). Borrower Loans and Loans Held for Sale: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 706,539 $ 820,407 Weighted-average discount rate 6.88 % 6.72 % Weighted-average default rate 12.44 % 9.31 % Fair value resulting from: 100 basis point increase in discount rate $ 699,770 $ 812,061 200 basis point increase in discount rate $ 693,167 803,927 Fair value resulting from: 100 basis point decrease in discount rate $ 713,481 $ 828,975 200 basis point decrease in discount rate $ 720,601 837,773 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 696,510 $ 810,657 Applying a 1.2 multiplier to default rate $ 686,586 800,989 Fair value resulting from: Applying a 0.9 multiplier to default rate $ 716,671 $ 830,238 Applying a 0.8 multiplier to default rate $ 726,910 840,156 Key economic assumptions and the sensitivity of the fair value to immediate changes in those assumptions at December 31, 2023 and 2022 for Notes are presented in the following table (in thousands, except percentages). Notes: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 321,966 $ 318,704 Weighted-average discount rate 6.55 % 6.87 % Weighted-average default rate 14.21 % 11.36 % Fair value resulting from: 100 basis point increase in discount rate $ 318,877 $ 315,456 200 basis point increase in discount rate $ 315,863 312,291 Fair value resulting from: 100 basis point decrease in discount rate $ 325,134 $ 322,037 200 basis point decrease in discount rate $ 328,384 325,461 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 317,359 $ 314,892 Applying a 1.2 multiplier to default rate $ 312,800 311,112 Fair value resulting from: Applying a 0.9 multiplier to default rate $ 326,621 $ 322,547 Applying a 0.8 multiplier to default rate $ 331,325 326,425 |
Schedule Of Estimated Fair Value Of Sensitivity Assets And Liabilities | Key economic assumptions and the sensitivity of the fair value to immediate changes in those assumptions at December 31, 2023 and 2022 for Servicing Assets is presented in the following table (in thousands, except percentages). Servicing Assets: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 12,249 $ 12,562 Weighted-average market servicing rate 0.65 % 0.65 % Weighted-average prepayment rate 19.55 % 18.47 % Weighted-average default rate 15.25 % 13.38 % Fair value resulting from: Market servicing rate increase of 0.025% $ 11,475 $ 11,708 Market servicing rate decrease of 0.025% $ 13,023 $ 13,415 Fair value resulting from: Applying a 1.1 multiplier to prepayment rate $ 11,969 $ 12,286 Applying a 0.9 multiplier to prepayment rate $ 12,533 $ 12,842 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 11,998 $ 12,305 Applying a 0.9 multiplier to default rate $ 12,503 $ 12,820 |
Schedule of Derivative Assets Measured at Fair Value | Key economic assumptions and the sensitivity of the fair value to immediate changes in those assumptions at December 31, 2023 and 2022 for the Credit Card Derivative is presented in the following table (in thousands, except percentages). Credit Card Derivative: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 36,848 $ 10,782 Prosper Credit Card portfolio $ 286,284 $ 113,917 Discount rate on Prosper Credit Card portfolio 23.19 % 26.23 % Discount rate on Coastal Program Fee 7.41 % 9.26 % Prepayment rate applied to Credit Card portfolio 8.14 % 10.08 % Default rate applied to Credit Card portfolio 14.36 % 13.34 % Fair value resulting from: 100 basis point increase in both discount rates $ 36,452 $ 10,699 200 basis point increase in both discount rates $ 36,065 $ 10,618 Fair value resulting from: 100 basis point decrease in both discount rates $ 37,253 $ 10,866 200 basis point decrease in both discount rates $ 37,668 $ 10,951 Fair value resulting from: Applying a 1.1 multiplier to prepayment rate $ 36,374 $ 10,625 Applying a 0.9 multiplier to prepayment rate $ 37,328 $ 10,942 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 29,659 $ 8,001 Applying a 0.9 multiplier to default rate $ 44,256 $ 13,641 |
Schedule of Derivative Liability Measured at Fair Value | Key economic assumptions and the sensitivity of the fair value to immediate changes in those assumptions at December 31, 2023 and 2022 for Credit Card servicing obligation liability is presented in the following table (in thousands, except percentages). Credit Card servicing obligation liability: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: 9,732 3,720 Discount rate on Credit Card portfolio servicing obligation 7.41 % 9.26 % Prepayment rate applied to Credit Card portfolio 8.14 % 10.08 % Default rate applied to Credit Card portfolio 14.36 % 13.34 % Market servicing rate 2.00 % 2.00 % Fair value resulting from: Market servicing rate increase of 0.10% $ 10,253 $ 3,919 Market servicing rate decrease of 0.10% $ 9,213 $ 3,521 Fair value resulting from: Applying a 1.1 multiplier to prepayment rate $ 9,609 $ 3,662 Applying a 0.9 multiplier to prepayment rate $ 9,858 $ 3,779 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 9,487 $ 3,636 Applying a 0.9 multiplier to default rate $ 9,984 $ 3,806 |
Schedule of Financial Instruments, Assets And Liabilities Not Recorded at Fair Value | The following tables present the fair value hierarchy for assets and liabilities not recorded at fair value (in thousands): Balance at December 31, 2023 Carrying Amount Level 1 Inputs Level 2 Inputs Level 3 Inputs Fair Value Assets: Cash and Cash Equivalents $ 34,970 $ 34,970 $ — $ — $ 34,970 Restricted Cash - Cash and Cash Equivalents 117,270 117,270 — — 117,270 Restricted Cash - Certificates of Deposit 3,028 — 3,028 — 3,028 Accounts Receivable 7,523 — 7,523 — 7,523 Total Assets $ 162,791 $ 152,240 $ 10,551 $ — $ 162,791 Liabilities: Accounts Payable and Accrued Liabilities $ 40,906 $ — $ 40,906 $ — $ 40,906 Payable to Investors 86,732 — 86,732 — 86,732 Notes Issued by Securitization Trust 214,798 — 208,005 — 208,005 Warehouse Lines 160,207 — 157,972 — 157,972 Term Loan (Note 11) 75,313 — 77,837 — 77,837 Total Liabilities $ 577,956 $ — $ 571,452 $ — $ 571,452 Balance at December 31, 2022 Carrying Amount Level 1 Inputs Level 2 Inputs Level 3 Inputs Fair Value Assets: Cash and Cash Equivalents $ 83,446 $ 83,446 $ — $ — $ 83,446 Restricted Cash - Cash and Cash Equivalents 108,284 108,284 — — 108,284 Restricted Cash - Certificates of Deposit 4,879 — 4,879 — 4,879 Accounts Receivable 3,462 — 3,462 — 3,462 Total Assets $ 200,071 $ 191,730 $ 8,341 $ — $ 200,071 Liabilities: Accounts Payable and Accrued Liabilities $ 37,254 $ — $ 37,254 $ — $ 37,254 Payable to Investors 85,312 — 85,312 — 85,312 Warehouse Lines 446,762 — 444,329 — 444,329 Paycheck Protection Program loan (Note 11) 73,407 — 76,191 — 76,191 Total Liabilities $ 642,735 $ — $ 643,086 $ — $ 643,086 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Schedule of Fair Value Hierarchy for Assets and Liabilities Measured at Fair Value | The following tables present the fair value hierarchy for assets and liabilities measured at fair value (in thousands): December 31, 2023 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans, at Fair Value $ — $ — $ 324,311 $ 324,311 Servicing Assets — — 13,818 13,818 Total Assets $ — $ — $ 338,129 $ 338,129 Liabilities: Notes, at Fair Value $ — $ — $ 321,966 $ 321,966 Loan Trailing Fee Liability* — — 2,942 2,942 Total Liabilities $ — $ — $ 324,908 $ 324,908 December 31, 2022 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans, at Fair Value $ — $ — $ 320,642 $ 320,642 Servicing Assets — — 14,860 14,860 Total Assets $ — $ — $ 335,502 $ 335,502 Liabilities: Notes, at Fair Value $ — $ — $ 318,704 $ 318,704 Loan Trailing Fee Liability* — — 3,290 3,290 Total Liabilities $ — $ — $ 321,994 $ 321,994 *Included in Other Liabilities on the Consolidated Balance Sheets. |
Schedule of Quantitative Information About Significant Unobservable Inputs | The following tables present quantitative information about the significant unobservable inputs used for PFL’s Level 3 fair value measurements at the dates presented: Range Borrower Loans and Notes: December 31, 2023 December 31, 2022 Discount rate 5.5 % — 8.0 % 5.6 % — 12.9 % Default rate 3.2 % — 23.6 % 1.8 % — 18.2 % Range Servicing Assets: December 31, 2023 December 31, 2022 Discount rate 15.0 % — 25.0 % 15.0 % — 25.0 % Default rate 2.8 % — 23.6 % 2.0 % — 19.3 % Prepayment rate 6.1 % — 30.6 % 14.2 % — 28.0 % Market servicing rate (1) (2) 0.633 % — 0.842 % 0.648 % — 0.842 % (1) Servicing assets associated with loans enrolled in a relief program offered by the Company as of December 31, 2023 and 2022 were measured using a market servicing rate assumption of 84.2 basis points. This rate was estimated using a multiplier consistent with observable market rates for other loan types, applied to the base market servicing rate assumption. (2) Excludes collection fees that would be passed on to a hypothetical third-party servicer. As of December 31, 2023 and 2022, the market rate for col lection fees and non-sufficient fund fees was assumed to be 5 basis points and 6 basis points, respectively, for a weighted-average total market servicing rate of 68.3 basis points to 89.2 basis points and 70.8 basis points to 90.2 basis points, respectively. Range Loan Trailing Fee Liability: December 31, 2023 December 31, 2022 Discount rate 15.0 % — 25.0 % 15.0 % — 25.0 % Default rate 2.8 % — 23.6 % 2.0 % — 19.3 % Prepayment rate 6.1 % — 30.6 % 14.2 % — 28.0 % |
Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following table presents additional information about Level 3 Loans Held for Sale, Borrower Loans, and Notes measured at fair value on a recurring basis for the year ended December 31, 2023 and 2022 (in thousands): Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Assets Liabilities Borrower Loans Held Notes Total Fair value at January 1, 2022 $ 267,626 $ — $ (265,985) $ 1,641 Originations 284,921 3,063,729 (285,115) 3,063,535 Principal repayments (187,599) — 202,308 14,709 Borrower Loans sold to third parties (14,520) (3,063,729) — (3,078,249) Other changes 650 — (742) (92) Change in fair value (30,436) — 30,830 394 Fair value at December 31, 2022 $ 320,642 $ — $ (318,704) $ 1,938 Originations 232,306 1,921,129 (231,520) 1,921,915 Borrower Loans contributed by Parent, at Fair Value 2,010 — — 2,010 Principal repayments (186,433) — 188,670 2,237 Borrower Loans sold to third parties (4,646) (1,921,129) — (1,925,775) Other changes 717 — (815) (98) Change in fair value (40,285) — 40,403 118 Fair value at December 31, 2023 $ 324,311 $ — $ (321,966) $ 2,345 |
Schedule of Servicing Assets and Liabilities Measured at Fair Value | The following table presents additional information about Level 3 Servicing Assets recorded at fair value (in thousands): Servicing Assets Fair value at January 1, 2022 $ 9,796 Additions 15,277 Change in fair value (10,213) Fair value at December 31, 2022 $ 14,860 Additions 10,151 Change in fair value (11,193) Fair value at December 31, 2023 $ 13,818 Loan Trailing Fee Liability The fair value of the Loan Trailing Fee Liability represents the present value of the expected monthly Loan Trailing Fee payments, which takes into consideration certain assumptions related to expected prepayment rates and default rates using a discounted cash flow model. The assumptions used are the same as those used for the valuation of Servicing Assets, as described below. The following tables present additional information about Level 3 Loan Trailing Fee Liability measured at fair value on a recurring basis (in thousands): Loan Trailing Fee Liability Fair Value at January 1, 2022 $ 2,161 Issuances 3,070 Cash payment of Loan Trailing Fee (2,245) Change in fair value 304 Fair Value at December 31, 2022 $ 3,290 Issuances 2,011 Cash payment of Loan Trailing Fee (2,791) Change in fair value 432 Fair Value at December 31, 2023 $ 2,942 |
Schedule of Fair Value Assumptions | Key economic assumptions are used to compute the fair value of Borrower Loans and Notes. The sensitivity of the current fair value to immediate changes in assumptions at December 31, 2023 and 2022 for Borrower Loans are presented in the following table (in thousands, except percentages): Borrower Loans: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 324,311 $ 320,642 Weighted-average discount rate 6.55 % 6.87 % Weighted-average default rate 14.36 % 11.36 % Fair value resulting from: 100 basis point increase in discount rate $ 321,204 $ 317,380 200 basis point increase in discount rate $ 318,174 $ 314,201 Fair value resulting from: 100 basis point decrease in discount rate $ 327,498 $ 323,991 200 basis point decrease in discount rate $ 330,766 $ 327,429 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 319,708 $ 316,832 Applying a 1.2 multiplier to default rate $ 315,153 $ 313,053 Fair value resulting from: Applying a 0.9 multiplier to default rate $ 328,962 $ 324,484 Applying a 0.8 multiplier to default rate $ 333,662 $ 328,361 Key economic assumptions are used to compute the fair value of Notes. The sensitivity of the fair value to immediate changes in assumptions at December 31, 2023 and 2022 for Notes funded through the Note Channel are presented in the following table (in thousands, except percentages): Notes: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 321,966 $ 318,704 Weighted-average discount rate 6.55 % 6.87 % Weighted-average default rate 14.21 % 11.36 % Fair value resulting from: 100 basis point increase in discount rate $ 318,877 $ 315,456 200 basis point increase in discount rate $ 315,863 $ 312,291 Fair value resulting from: 100 basis point decrease in discount rate $ 325,134 $ 322,037 200 basis point decrease in discount rate $ 328,384 $ 325,461 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 317,359 $ 314,892 Applying a 1.2 multiplier to default rate $ 312,800 $ 311,112 Fair value resulting from: Applying a 0.9 multiplier to default rate $ 326,621 $ 322,547 Applying a 0.8 multiplier to default rate $ 331,325 $ 326,425 |
Schedule Of Estimated Fair Value Of Sensitivity Assets And Liabilities | Key economic assumptions are used to compute the fair value of Servicing Assets. The sensitivity of the current fair value to immediate changes in assumptions at December 31, 2023 and 2022 for Servicing Assets are presented in the following table (in thousands, except percentages): Servicing Assets: December 31, 2023 December 31, 2022 Fair value, using the following assumptions: $ 13,818 $ 14,860 Weighted-average market servicing rate 0.650 % 0.649 % Weighted-average prepayment rate 19.96 % 18.77 % Weighted-average default rate 14.74 % 12.63 % Fair value resulting from: Market servicing rate increase of 0.025% $ 12,945 $ 13,850 Market servicing rate decrease of 0.025% $ 14,691 $ 15,870 Fair value resulting from: Applying a 1.1 multiplier to prepayment rate $ 13,502 $ 14,534 Applying a 0.9 multiplier to prepayment rate $ 14,139 $ 15,191 Fair value resulting from: Applying a 1.1 multiplier to default rate $ 13,534 $ 14,557 Applying a 0.9 multiplier to default rate $ 14,104 $ 15,165 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Other Intangible Assets for the Periods Presented | The following table presents the detail of other Intangible Assets subject to amortization as of the following dates (dollars in thousands): December 31, 2023 Gross Carrying Value Accumulated Amortization Net Carrying Value Remaining Useful Life (In Years) Developed technology $ 3,060 $ (3,060) $ — — User base and customer relationships 5,050 (4,965) 85 1.3 Brand name 60 (60) — — Total Intangible Assets subject to amortization $ 8,170 $ (8,085) $ 85 December 31, 2022 Gross Carrying Value Accumulated Amortization Net Carrying Value Remaining Useful Life (In Years) Developed technology $ 3,060 $ (3,060) $ — — User base and customer relationships 5,050 (4,858) 192 2.3 Brand name 60 (60) — — Total Intangible Assets subject to amortization $ 8,170 $ (7,978) $ 192 |
Schedule of Estimated Amortization of Purchased Intangible Assets | Estimated amortization of purchased Intangible Assets for future periods is as follows (in thousands): Amounts Years Ending December 31, 2024 $ 85 Total Amortization Expenses $ 85 |
OTHER LIABILITIES (Tables)
OTHER LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Other Liabilities [Abstract] | |
Schedule of Other Liabilities | Other Liabilities consists of the following (in thousands): December 31, 2023 2022 Operating lease liabilities (Note 16) $ 14,431 $ 16,351 Deferred revenue 6,373 3,880 Credit Card servicing obligation liability (Note 5) 9,732 3,720 Loan trailing fee liability 2,942 3,290 Deferred income tax liability 721 658 Other 1,060 359 Total Other Liabilities $ 35,259 $ 28,258 |
NET INCOME (LOSS) PER SHARE (Ta
NET INCOME (LOSS) PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net Income (Loss) Per Share | Basic and diluted net income (loss) per share were calculated as follows for the periods presented (in thousands, except share and per share amounts): December 31, 2023 2022 2021 Numerator: Net (Loss) Income $ (106,462) $ 70,582 $ (138,341) Less: Net Income Allocated to Participating Securities — (47,350) — Net (Loss) Income Attributable to Common Stockholders $ (106,462) $ 23,232 $ (138,341) Denominator: Weighted average shares used in computing basic and diluted Net (Loss) Income Per Share 76,092,569 73,291,714 70,767,275 Effect of dilutive securities: Stock options — 61,466,722 — Warrants — 570,313 — Convertible preferred stock warrants — 213,264,845 — Weighted average shares used in computing diluted Net (Loss) Income Per Share 76,092,569 348,593,594 70,767,275 Net (Loss) Income Per Share – Basic $ (1.40) $ 0.32 $ (1.95) Net (Loss) Income Per Share – Diluted $ (1.40) $ 0.07 $ (1.95) |
Schedule of Computation of Diluted Net Income (Loss) Per Share | The following common stock equivalents were excluded from the computation of diluted net income (loss) per share for the periods presented because including them would have been anti-dilutive (number of shares): December 31, 2023 2022 2021 Excluded Securities: Convertible Preferred Stock issued and outstanding 158,365,655 158,365,655 158,365,655 Stock options issued and outstanding 80,863,096 17,703,550 72,756,708 Warrants issued and outstanding 1,080,349 510,036 1,080,349 Series E-1 Convertible Preferred Stock warrants 35,544,141 — 35,544,141 Series F Convertible Preferred Stock warrants 177,720,704 — 177,720,704 Total Excluded Securities 453,573,945 176,579,241 445,467,557 |
CONVERTIBLE PREFERRED STOCK, _2
CONVERTIBLE PREFERRED STOCK, CONVERTIBLE PREFERRED STOCK WARRANT LIABILITY AND COMMON STOCK (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Shares Authorized, Issued, Outstanding, Par Value and Liquidation Preference of Convertible Preferred Stock | The number of authorized, issued and outstanding shares, their par value and liquidation preference for each series of Convertible Preferred Stock as of December 31, 2023 are disclosed in the table below (amounts in thousands, except share and par value amounts): Par Value Authorized Shares Outstanding and Issued Shares Liquidation Preference, Outstanding Shares Series A $ 0.01 68,558,220 66,428,185 * $ 19,160 Series A-1 $ 0.01 24,760,915 22,515,315 45,031 Series B $ 0.01 35,775,880 35,127,160 * 21,190 Series C $ 0.01 24,404,770 24,404,770 70,075 Series D $ 0.01 23,888,640 23,888,640 165,000 Series E-1 $ 0.01 35,544,141 — — Series E-2 $ 0.01 16,858,078 — — Series F $ 0.01 177,720,707 3 — Series G $ 0.01 37,249,497 37,249,497 50,000 Total 444,760,848 209,613,570 $ 370,456 * Series A and Series B Convertible Preferred Stock totals are inclusive of 34,670,420 and 16,577,495 shares, respectively, held by PGT, a consolidated VIE. |
Schedule of Assumptions Used | The Company determined the fair value of the outstanding Series E-1 preferred stock warrants utilizing the following assumptions as of December 31, 2023 and 2022: December 31, 2023 2022 Volatility 66.0 % 72.0 % Risk-free interest rate 4.10 % 4.30 % Expected term (in years) 2.75 2.75 Dividend yield — % — % The Company determined the fair value of the outstanding Series F Warrants utilizing the following assumptions as of December 31, 2023 and 2022: December 31, 2023 2022 Volatility 66.00 % 72.0 % Risk-free interest rate 4.10 % 4.30 % Expected term (in years) 2.75 2.75 Dividend yield — % — % |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Option Activity under Option Plan | Stock option activity under the 2005 Plan and 2015 Plan is summarized for the year ended December 31, 2023 below: Options Issued and Outstanding Weighted- Average Exercise Price Weighted-Average Contractual Term (in years) Aggregate intrinsic value 1 (in thousands) Balance as of January 1, 2023 77,727,763 $ 0.13 6.22 $ 19,450 Options granted 11,086,530 $ 0.34 Options exercised (2,637,479) $ 0.04 Options forfeited (4,024,418) $ 0.35 Option expirations (39,125) $ 0.02 Balance as of December 31, 2023 82,113,271 $ 0.15 5.70 $ 22,107 Options vested and expected to vest as of December 31, 2023 77,171,342 $ 0.15 5.70 $ 21,659 Options vested and exercisable at December 31, 2023 60,741,572 $ 0.08 4.65 $ 20,168 1. Aggregate intrinsic value represents the excess of the fair value of our Common Stock as of December 31, 2023 over the exercise price of the outstanding in-the-money options. |
Schedule of Weighted Average Grant Date Fair Value of Options Granted | Additional information pertaining to PMI's Common Stock option activities is as follows: Year ended December 31, 2023 2022 2021 Weighted-average grant date fair value of options granted (per share) $ 0.21 $ 0.37 $ 0.13 |
Schedule of Fair Value of Stock Option Awards | The fair value of PMI’s stock option awards granted during the years ended December 31, 2023, 2022 and 2021 was estimated at the date of grant using the Black-Scholes model with the following weighted average assumptions: December 31, 2023 2022 2021 Volatility of common stock 66.63 % 67.19 % 64.22 % Risk-free interest rate 3.55 % 2.95 % 1.02 % Expected life 6.0 years 6.0 years 6.0 years Dividend yield — % — % — % |
Schedule of Number of PMI’s RSU Activity | The following table summarizes the number of PMI’s RSU activity for the year ended December 31, 2023: Number of Shares Weighted-Average Grant Date Fair Value Unvested at January 1, 2023 2,602,383 $ 1.04 Forfeited (27,750) $ 2.18 Expired — $ — Unvested at December 31, 2023 2,574,633 $ 1.03 |
Schedule of Stock Based Compensation Included in Consolidated Statements of Operations | The following table presents the amount of stock-based compensation related to stock-based awards granted to employees recognized in the Company’s Consolidated Statements of Operations for the periods presented (in thousands): Years Ended December 31, 2023 2022 2021 Origination and Servicing $ 83 $ 134 $ 123 Sales and Marketing 304 118 62 General and Administrative 1,188 1,074 951 Total Stock-Based Compensation $ 1,575 $ 1,326 $ 1,136 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax | The components of the Company’s Income Tax Expense are as follows for the periods presented (in thousands): Years Ended December 31, 2023 2022 2021 Current: Federal $ — $ — $ — State 15 197 — Foreign — — — Total Current Income Tax Expense 15 197 — Deferred: Federal 47 47 47 State 16 51 24 Foreign — — — Total Deferred Income Tax Expense 63 98 71 Total Income Tax Expense $ 78 $ 295 $ 71 |
Schedule of Effective Income Tax Reconciliation | Income Tax Expense differed from the amount computed by applying the U.S. federal income tax rate of 21% to pretax income (loss) as a result of the following for the periods presented: Years Ended December 31, 2023 2022 2021 Federal tax at statutory rate 21 % 21 % 21 % State tax at statutory rate (net of federal benefit) 8 % 6 % 8 % Incentive stock options (1) % 1 % (5) % Preferred Stock Warrants (12) % (36) % (29) % Change in valuation allowance (18) % 15 % 6 % Return-to-provision (1) % (2) % — % State tax rate changes 2 % (5) % — % Other 1 % — % (1) % Income Tax Expense — % — % — % |
Schedule of Deferred Tax Assets and Liabilities | Temporary items that give rise to significant portions of deferred tax assets and liabilities are as follows for the periods presented (in thousands): December 31, 2023 2022 Net operating loss carry forwards $ 103,119 $ 85,330 Research and other credits 3,589 3438 Stock compensation 3,816 4,025 Accrued liabilities 4,520 5,159 Net servicing rights 35 — Lease liabilities 4,181 4,798 Property and equipment 2,029 1,214 Section 174 R&D capitalization 9,919 11,204 Total deferred tax assets 131,208 115,168 Net servicing rights — (2,040) Intangible assets (2,468) (2,129) Right-of-use assets (3,137) (4,147) Total deferred tax liabilities (5,605) (8,316) Total net deferred tax asset 125,603 106,852 Less: Valuation allowance (126,324) (107,512) Net deferred tax liability $ (721) $ (660) |
Schedule of Unrecognized Tax Benefits | The following table summarizes Prosper’s activity related to its unrecognized tax benefits (in thousands): Balance at December 31, 2020 $ 112 Change related to 2021 tax year position — Balance at December 31, 2021 $ 112 Increase related to 2022 tax year position 1,179 Balance at December 31, 2022 $ 1,291 Change related to prior year tax position — Balance at December 31, 2023 $ 1,291 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Schedule of Right-of-use Assets | The following table summarizes the operating lease ROU assets as of December 31, 2023 , which are included in Property and Equipment, Net on the Consolidated Balance Sheets . December 31, 2023 Gross Carrying Value Accumulated Amortization Net Carrying Value ROU assets - office buildings $ 22,655 $ 11,825 $ 10,830 |
Schedule of Maturity of Lease Liabilities | Future maturities of operating lease liabilities as of December 31, 2023 were as follows (in thousands). The present value of the future minimum lease payments represents the Company’s operating lease liabilities as of December 31, 2023 and are included in “ Other Liabilities” December 31, 2023 2024 $ 4,497 2025 4,517 2026 4,432 2027 3,311 2028 1,411 Thereafter — Total future minimum lease payments 18,168 Less: Imputed interest (3,737) Present value of future minimum lease payments $ 14,431 |
Schedule of Supplemental Cash Flow Information | Supplemental cash flow information related to the Company’s operating leases is as follows (dollars in thousands): Years Ended December 31, 2023 2022 2021 Non-cash operating activity: ROU assets obtained or adjusted in exchange for new, amended and modified operating lease liabilities $ (697) $ 9,980 $ 1,773 |
Schedule of Value Used In Determining Present Value of Leases | The weighted-average remaining lease term and discount rate used in the calculation of the Company’s operating lease assets and liabilities are as follows (dollars in thousands): December 31, 2023 Weighted-average remaining lease term 4.01 years Weighted-average discount rate 11.27 % |
RELATED PARTIES (Tables)
RELATED PARTIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Entity Information [Line Items] | |
Schedule of Aggregate Amount of Notes Purchased and the Income Earned | The aggregate amount of the Notes purchased and the income earned by parties deemed to be affiliates and related parties of Prosper for the year ended December 31, 2023 and 2022, as well as the Notes outstanding as of December 31, 2023 and 2022 are summarized below (in thousands): Aggregate Amount of Notes Purchased for the Year Ended December 31, Interest Earned on Notes for the Year Ended December 31, 2023 2022 2023 2022 Executive officers and management $ 47 $ 37 $ 9 $ 7 Directors (excluding executive officers and management) — — 1 1 Total $ 47 $ 37 $ 10 $ 8 Notes Balance as of December 31, 2023 December 31, 2022 Executive officers and management $ 64 $ 52 Directors (excluding executive officers and management) 1 6 Total $ 65 $ 58 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Schedule of Aggregate Amount of Notes Purchased and the Income Earned | The aggregate amount of the Notes purchased and the income earned by parties deemed to be related parties of PFL for the years ended December 31, 2023 and 2022 are summarized below (in thousands): Aggregate Amount of Notes Purchased for the Year Ended December 31, Interest Earned on Notes for the Year Ended December 31, 2023 2022 2023 2022 Executive officers and management $ 30 $ 34 $ 8 $ 7 Directors (excluding executive officers and management) — — — — Total $ 30 $ 34 $ 8 $ 7 The balance of Notes held by officers and directors who are not executive officers are as follows (in thousands): Notes Balance as of December 31, 2023 December 31, 2022 Executive officers and management $ 47 $ 45 Directors (excluding executive officers and management) — — Total $ 47 $ 45 |
SEGMENTS (Tables)
SEGMENTS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Year Ended December 31, 2023 Personal Loan Home Equity Credit Card Total Total Net Revenue $ 100,921 $ 1,875 $ 34,904 $ 137,700 Impact of interest rates on fair value of loans held in consolidated trusts 2,629 — — 2,629 Accelerated amortization of PWIIT debt issuance costs 1,880 — — 1,880 Segment Adjusted Net Revenue $ 105,430 $ 1,875 $ 34,904 $ 142,209 Segment Adjusted EBITDA $ (32,027) $ (2,483) $ 3,882 $ (30,628) Depreciation expense: Origination and Servicing (8,774) General and Administrative (2,108) Amortization of intangibles (107) Stock-based compensation (1,575) Impairment of operating lease right-of-use assets (196) Change in Fair Value of Convertible Preferred Stock Warrants (48,695) Impact of interest rates on fair value of loans held in consolidated trusts (2,629) Interest income on cash and cash equivalents 2,473 Interest Expense on Term Loan (12,265) Accelerated amortization of PWIIT debt issuance costs (1,880) Net Loss Before Income Taxes $ (106,384) Interest Income (Expense) Included in Segment Adjusted EBITDA Interest Income on Borrower Loans and Loans Held for Sale $ 115,663 $ — $ — $ 115,663 Interest Expense on Financial Instruments (91,983) — — (91,983) Total Interest Income, Net $ 23,680 $ — $ — $ 23,680 Year Ended December 31, 2022 Personal Loan Home Equity Credit Card Total Total Net Revenue $ 180,717 $ 2,821 $ 16,343 $ 199,881 Impact of interest rates on fair value of loans held in consolidated trusts 7,248 — — 7,248 Segment Adjusted Net Revenue $ 187,965 $ 2,821 $ 16,343 $ 207,129 Segment Adjusted EBITDA $ 9,301 $ (2,163) $ (8,946) $ (1,808) Depreciation expense: Origination and Servicing (8,132) General and Administrative (2,656) Amortization of intangibles (136) Stock-based compensation (1,326) Change in Fair Value of Convertible Preferred Stock Warrants 84,595 Gain on Forgiveness of PPP Loan 8,604 Impact of interest rates on fair value of loans held in consolidated trusts (7,248) Interest income on cash and cash equivalents 511 Interest Expense on Term Loan (1,527) Net Income Before Income Taxes $ 70,877 Interest Income (Expense) Included in Segment Adjusted EBITDA Interest Income on Borrower Loans and Loans Held for Sale $ 86,350 $ — $ — $ 86,350 Interest Expense on Financial Instruments (60,025) — — (60,025) Total Interest Income, Net $ 26,325 $ — $ — $ 26,325 Year Ended December 31, 2021 Personal Loan Home Equity Credit Card Total Total Net Revenue $ 143,670 $ 946 $ 10 $ 144,626 Impact of interest rates on fair value of loans held in consolidated trusts 3,084 — — 3,084 Segment Adjusted Net Revenue $ 146,754 $ 946 $ 10 $ 147,710 Segment Adjusted EBITDA $ 22,303 $ (2,556) $ (3,849) $ 15,898 Depreciation expense: Organization and Servicing (7,167) General and Administrative (2,501) Amortization of intangibles (172) Stock-based compensation (1,136) Change in Fair Value of Convertible Preferred Stock Warrants (138,622) Loss on Deconsolidation of VIEs (1,494) Impact of interest rates on fair value of loans held in consolidated trusts (3,084) Interest income on cash and cash equivalents 8 Net Loss Before Income Taxes $ (138,270) Interest Income (Expense) Included in Segment Adjusted EBITDA Interest Income on Borrower Loans and Loans Held for Sale $ 83,107 $ — $ — $ 83,107 Interest Expense on Financial Instruments (50,816) — — (50,816) Total Interest Income, Net $ 32,291 $ — $ — $ 32,291 |
ORGANIZATION AND BUSINESS (Deta
ORGANIZATION AND BUSINESS (Details) | 12 Months Ended |
Dec. 31, 2023 state | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |
Percentage of notes allowed for investors to purchase | 100% |
Number of states and district marketplace is open to investors | 31 |
Additional number of states and district marketplace is open to borrowers | 48 |
Prosper Funding LLC | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |
Percentage of notes allowed for investors to purchase | 100% |
Number of states and district marketplace is open to investors | 31 |
Additional number of states and district marketplace is open to borrowers | 48 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNT POLICIES - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Aug. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Jul. 31, 2023 | |
Entity Information [Line Items] | |||||
Servicing fee, percent | 1% | ||||
Credit Card Derivative | $ 300,000 | $ 36,848 | $ 10,782 | $ 200,000 | |
Reclassification of restricted cash to prepaid and other assets | $ 9,300 | ||||
Servicing fee percentage | 1% | ||||
Advertising costs | $ 17,600 | $ 15,000 | $ 6,100 | ||
Prosper Funding LLC | |||||
Entity Information [Line Items] | |||||
Servicing fee, percent | 1% | ||||
Minimum | |||||
Entity Information [Line Items] | |||||
Transaction fee percentage | 1% | ||||
Minimum | Internal-use software and website development costs | |||||
Entity Information [Line Items] | |||||
Property and equipment, estimated useful life | 1 year | ||||
Minimum | Prosper Funding LLC | Internal-use software and website development costs | |||||
Entity Information [Line Items] | |||||
Property and equipment, estimated useful life | 1 year | ||||
Maximum | |||||
Entity Information [Line Items] | |||||
Transaction fee percentage | 7.99% | ||||
Maximum | Internal-use software and website development costs | |||||
Entity Information [Line Items] | |||||
Property and equipment, estimated useful life | 5 years | ||||
Maximum | Prosper Funding LLC | Internal-use software and website development costs | |||||
Entity Information [Line Items] | |||||
Property and equipment, estimated useful life | 5 years | ||||
User base and customer relationships | |||||
Entity Information [Line Items] | |||||
Remaining Useful Life (In Years) | 1 year 3 months 18 days | 2 years 3 months 18 days | |||
User base and customer relationships | Minimum | |||||
Entity Information [Line Items] | |||||
Remaining Useful Life (In Years) | 3 years | ||||
User base and customer relationships | Maximum | |||||
Entity Information [Line Items] | |||||
Remaining Useful Life (In Years) | 10 years | ||||
Developed technology | Minimum | |||||
Entity Information [Line Items] | |||||
Remaining Useful Life (In Years) | 3 years | ||||
Developed technology | Maximum | |||||
Entity Information [Line Items] | |||||
Remaining Useful Life (In Years) | 5 years | ||||
Brand name | |||||
Entity Information [Line Items] | |||||
Remaining Useful Life (In Years) | 1 year | ||||
Borrower Loans | |||||
Entity Information [Line Items] | |||||
Servicing fee, percent | 1% | ||||
Loan trailing fee, percent | 0.075% | ||||
Borrower Loans | Prosper Funding LLC | |||||
Entity Information [Line Items] | |||||
Servicing fee, percent | 1% | ||||
Loan trailing fee, percent | 0.075% |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNT POLICIES - Estimated Useful Lives of Assets (Details) | Dec. 31, 2023 |
Furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful life | 7 years |
Office equipment | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful life | 5 years |
Computers and equipment | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful life | 3 years |
Leasehold improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful life | 5 years |
Leasehold improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful life | 8 years |
Internal-use software and website development costs | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful life | 1 year |
Internal-use software and website development costs | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful life | 5 years |
Prosper Funding LLC | Internal-use software and website development costs | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful life | 1 year |
Prosper Funding LLC | Internal-use software and website development costs | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, estimated useful life | 5 years |
PROPERTY AND EQUIPMENT, NET - S
PROPERTY AND EQUIPMENT, NET - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Total Property and Equipment, Net | Total Property and Equipment, Net |
Property and equipment | $ 111,260 | $ 106,157 |
Less: Accumulated depreciation and amortization | (70,371) | (67,343) |
Total Property and Equipment, Net | 40,889 | 38,814 |
Prosper Funding LLC | ||
Property, Plant and Equipment [Line Items] | ||
Less: Accumulated depreciation and amortization | (31,978) | (27,424) |
Total Property and Equipment, Net | 11,641 | 10,004 |
Internal-use software and website development costs | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 58,423 | 49,818 |
Internal-use software and website development costs | Prosper Funding LLC | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 43,619 | 37,428 |
Operating lease right-of-use assets | ||
Property, Plant and Equipment [Line Items] | ||
Operating lease right-of-use assets | 22,655 | 27,051 |
Computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 10,466 | 13,444 |
Office equipment and furniture | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 2,936 | 2,810 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 6,827 | 7,157 |
Assets not yet placed in service | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 9,953 | $ 5,877 |
PROPERTY AND EQUIPMENT, NET - A
PROPERTY AND EQUIPMENT, NET - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation and Amortization | $ 10,989 | $ 10,924 | $ 9,839 |
Prosper Funding LLC | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation and Amortization | 6,268 | 5,525 | 4,878 |
Property and Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation and Amortization | 10,900 | 10,800 | 9,700 |
Internal-use software and website development costs | |||
Property, Plant and Equipment [Line Items] | |||
Capitalized internal-use software and website development costs | 14,900 | 11,000 | 9,800 |
Internal-use software and website development costs | Prosper Funding LLC | |||
Property, Plant and Equipment [Line Items] | |||
Capitalized internal-use software and website development costs | $ 7,900 | $ 7,600 | $ 5,900 |
BORROWER LOANS, LOANS HELD FO_3
BORROWER LOANS, LOANS HELD FOR SALE AND NOTES, AT FAIR VALUE - Fair Value of Borrower Loans and Notes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Borrower Loans, at Fair Value | $ 545,038 | $ 320,642 | |
Loans Held for Sale, at Fair Value | [1],[2] | 161,501 | 499,765 |
Notes, at Fair Value | 321,966 | 318,704 | |
Prosper Funding LLC | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Borrower Loans, at Fair Value | 324,311 | 320,642 | |
Notes, at Fair Value | 321,966 | 318,704 | |
Notes | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Payable to Related Party | 345,341 | 336,555 | |
Notes, Fair value adjustments | (23,375) | (17,851) | |
Notes, at Fair Value | 321,966 | 318,704 | |
Notes | Prosper Funding LLC | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Payable to Related Party | 345,341 | 336,555 | |
Notes, Fair value adjustments | (23,375) | (17,851) | |
Notes, at Fair Value | 321,966 | 318,704 | |
Borrower Loans | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Borrower Loans, Aggregate principal balance outstanding | 577,029 | 333,294 | |
Fair value adjustments | (31,991) | (12,652) | |
Borrower Loans, at Fair Value | 545,038 | 320,642 | |
Borrower Loans | Prosper Funding LLC | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Borrower Loans, Aggregate principal balance outstanding | 342,791 | 333,294 | |
Fair value adjustments | (18,480) | (12,652) | |
Borrower Loans, at Fair Value | 324,311 | 320,642 | |
Loans Held for Sale | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Loans Held for Sale, Aggregate principal balance outstanding | 170,925 | 512,076 | |
Fair value adjustments | (9,424) | (12,311) | |
Loans Held for Sale, at Fair Value | $ 161,501 | $ 499,765 | |
[1] The following table presents the assets and liabilities of consolidated variable interest entities (“VIEs”), which are included in the Consolidated Balance Sheets above. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. Additionally, the assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. December 31, 2023 2022 Assets of consolidated VIEs, included in total assets above: Restricted Cash $ 23,546 $ 11,838 Loans Held for Sale, at Fair Value 161,501 499,765 Borrower Loans, Held at Fair Value 220,724 — Prepaid and Other Assets 972 3,210 Total assets of consolidated VIEs $ 406,743 $ 514,813 Liabilities of consolidated VIEs, included in total liabilities above: Notes Issued by Securitization Trust $ 214,798 $ — Warehouse Lines $ 160,207 $ 446,762 Other liabilities 550 $ — Total liabilities of consolidated VIEs $ 375,555 $ 446,762 (1) Includes amounts in consolidated variable interest entities presented separately in the table below. |
BORROWER LOANS, LOANS HELD FO_4
BORROWER LOANS, LOANS HELD FOR SALE AND NOTES, AT FAIR VALUE - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Sep. 25, 2023 | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Total Interest Income, Net | $ 23,680 | $ 26,325 | $ 32,291 | ||
Notes issued by securitization trust | [1],[2] | 214,798 | 0 | ||
VIE, Primary Beneficiary | |||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Notes issued by securitization trust | 214,798 | 0 | |||
VIE, Primary Beneficiary | Securtization Trust PMT 2023-1 | |||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Notes issued by securitization trust | $ 217,500 | ||||
Prosper Funding LLC | |||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Total Interest Income, Net | $ 3,616 | $ 3,124 | $ 2,438 | ||
Prosper Funding LLC | VIE, Primary Beneficiary | Securtization Trust PMT 2023-1 | |||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Notes issued by securitization trust | 7,700 | ||||
Debt instrument, fair value disclosure | $ 2,000 | ||||
Borrower Loans | |||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Maturity, in months | 24 months | 24 months | |||
Maturity term two, in months | 36 months | 36 months | |||
Maturity term three, in months | 48 months | 48 months | |||
Maturity term four, in months | 60 months | 60 months | |||
Fixed interest rate, minimum | 5.46% | 5.31% | |||
Fixed interest rate, maximum | 33% | 33% | |||
Minimum number of days for which loans originated were delinquent | 90 days | 90 days | |||
Fair value of loans originated | $ 1,300 | $ 300 | |||
Non accrual status past due date | 120 days | ||||
Loans in non-accrual status | $ 1,000 | $ 300 | |||
Borrower Loans | Prosper Funding LLC | |||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Maturity term one, in months | 24 months | ||||
Maturity term three, in months | 48 months | ||||
Maturity term four, in months | 60 months | ||||
Fixed interest rate, minimum | 5.46% | 5.31% | |||
Fixed interest rate, maximum | 33% | 33% | |||
Minimum number of days for which loans originated were delinquent | 90 days | 90 days | |||
Fair value of loans originated | $ 900 | $ 300 | |||
Non accrual status past due date | 120 days | ||||
Loans in non-accrual status | 800 | $ 300 | |||
Borrower Loans | Financing Receivables, Equal to Greater than 90 Days Past Due | |||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Aggregate principal amount | 7,000 | 2,700 | |||
Borrower Loans | Financing Receivables, Equal to Greater than 90 Days Past Due | Prosper Funding LLC | |||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Aggregate principal amount | $ 4,500 | $ 2,700 | |||
Borrower Loans | Minimum | Prosper Funding LLC | |||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Maturity term two, in months | 36 months | ||||
Borrower Loans | Maximum | Prosper Funding LLC | |||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Maturity term four, in months | 60 months | ||||
Loans Held for Sale | |||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Maturity term one, in months | 24 months | ||||
Maturity term two, in months | 36 months | ||||
Maturity term three, in months | 48 months | ||||
Maturity term four, in months | 60 months | ||||
Fixed interest rate, minimum | 6% | 5.31% | |||
Fixed interest rate, maximum | 33% | 33% | |||
Aggregate principal amount | $ 2,100 | ||||
Fair value of loans originated | $ 500 | $ 200 | |||
Non accrual status past due date | 120 days | ||||
Loans in non-accrual status | 200 | $ 200 | |||
Total Interest Income, Net | $ 53,700 | $ 41,000 | |||
Minimum number of days for which loans held for sale were delinquent | 90 days | 90 days | |||
Loans Held for Sale | Financing Receivables, Equal to Greater than 90 Days Past Due | |||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||||
Aggregate principal amount | $ 2,100 | ||||
[1] The following table presents the assets and liabilities of consolidated variable interest entities (“VIEs”), which are included in the Consolidated Balance Sheets above. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. Additionally, the assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. December 31, 2023 2022 Assets of consolidated VIEs, included in total assets above: Restricted Cash $ 23,546 $ 11,838 Loans Held for Sale, at Fair Value 161,501 499,765 Borrower Loans, Held at Fair Value 220,724 — Prepaid and Other Assets 972 3,210 Total assets of consolidated VIEs $ 406,743 $ 514,813 Liabilities of consolidated VIEs, included in total liabilities above: Notes Issued by Securitization Trust $ 214,798 $ — Warehouse Lines $ 160,207 $ 446,762 Other liabilities 550 $ — Total liabilities of consolidated VIEs $ 375,555 $ 446,762 (1) Includes amounts in consolidated variable interest entities presented separately in the table below. |
CREDIT CARD (Details)
CREDIT CARD (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Derivative [Line Items] | ||
Various fees and charges | $ 18.1 | $ 7 |
Servicing fee percentage | 1% | |
Change in fair value of servicing liability | $ 6 | 3.7 |
Credit Card Derivative (Note 5) | ||
Derivative [Line Items] | ||
Revenue earned | 26.1 | 9.8 |
Gain (loss) on settled transactions | $ (0.6) | $ 4.3 |
SERVICING ASSETS (Details)
SERVICING ASSETS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Servicing Assets And Liabilities Fair Value [Line Items] | |||
Gain (loss) on sales of loans, net | $ (12,380) | $ (1,039) | $ 7,196 |
Servicing Assets | |||
Servicing Assets And Liabilities Fair Value [Line Items] | |||
Outstanding principal | $ 3,100,000 | $ 3,200,000 | |
Maturity term one, in months | 24 months | 24 months | |
Maturity term two, in months | 36 months | 36 months | |
Maturity term three, in months | 48 months | 48 months | |
Maturity term four, in months | 60 months | 60 months | |
Fixed interest rate, minimum | 5.46% | 5.31% | |
Fixed interest rate, maximum | 33% | 33% | |
Contractually specified servicing fees, late charges and ancillary fees | $ 30,900 | $ 28,900 | 24,800 |
Prosper Funding LLC | |||
Servicing Assets And Liabilities Fair Value [Line Items] | |||
Gain (loss) on sales of loans, net | (11,285) | 1,678 | 8,450 |
Prosper Funding LLC | Servicing Assets | |||
Servicing Assets And Liabilities Fair Value [Line Items] | |||
Outstanding principal | $ 3,500,000 | $ 3,700,000 | |
Fixed interest rate, minimum | 5.46% | 5.31% | |
Fixed interest rate, maximum | 33% | 33% | |
Contractually specified servicing fees, late charges and ancillary fees | $ 39,700 | $ 33,800 | $ 29,200 |
Prosper Funding LLC | Servicing Assets | Minimum | |||
Servicing Assets And Liabilities Fair Value [Line Items] | |||
Maturity, in months | 36 months | ||
Maturity term one, in months | 24 months | 24 months | |
Maturity term two, in months | 36 months | ||
Maturity term three, in months | 48 months | 48 months | |
Prosper Funding LLC | Servicing Assets | Maximum | |||
Servicing Assets And Liabilities Fair Value [Line Items] | |||
Maturity, in months | 60 months | ||
Maturity term four, in months | 60 months |
SECURITIZATIONS (Details)
SECURITIZATIONS (Details) $ in Thousands | Dec. 31, 2023 USD ($) | Sep. 25, 2023 USD ($) class | Aug. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |||
Variable Interest Entity [Line Items] | ||||||||
Notes issued by securitization trust | [1],[2] | $ 214,798 | $ 0 | |||||
Borrower Loans, at Fair Value | 545,038 | 320,642 | ||||||
Restricted Cash | 120,298 | [1],[2] | 113,163 | [1],[2] | $ 167,925 | |||
VIE, Primary Beneficiary | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Notes issued by securitization trust | 214,798 | 0 | ||||||
Borrower Loans, at Fair Value | 220,724 | 0 | ||||||
Restricted Cash | $ 23,546 | $ 11,838 | ||||||
Securtization Trust PMT 2023-1 | VIE, Primary Beneficiary | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Securitization amount | $ 266,100 | $ 275,900 | ||||||
Number of classes issued | class | 5 | |||||||
Notes issued by securitization trust | $ 217,500 | |||||||
Unamortized debt issuance costs | 800 | |||||||
Debt issuance costs | 2,700 | |||||||
Borrower Loans, at Fair Value | 232,000 | |||||||
Restricted Cash | 12,600 | |||||||
2023-1, Class A Notes | VIE, Primary Beneficiary | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Notes issued by securitization trust | $ 165,500 | |||||||
Interest rate | 0.0706 | |||||||
2023-1, Class B Notes | VIE, Primary Beneficiary | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Notes issued by securitization trust | $ 25,400 | |||||||
Interest rate | 0.0748 | |||||||
2023-1, Class C Notes | VIE, Primary Beneficiary | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Notes issued by securitization trust | $ 25,100 | |||||||
Interest rate | 0.0829 | |||||||
2023-1, Class D Notes | VIE, Primary Beneficiary | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Notes issued by securitization trust | $ 22,300 | |||||||
Interest rate | 0.1124 | |||||||
2023-1, Class E Notes | VIE, Primary Beneficiary | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Notes issued by securitization trust | $ 13,100 | |||||||
Interest rate | 0.1549 | |||||||
[1] The following table presents the assets and liabilities of consolidated variable interest entities (“VIEs”), which are included in the Consolidated Balance Sheets above. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. Additionally, the assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. December 31, 2023 2022 Assets of consolidated VIEs, included in total assets above: Restricted Cash $ 23,546 $ 11,838 Loans Held for Sale, at Fair Value 161,501 499,765 Borrower Loans, Held at Fair Value 220,724 — Prepaid and Other Assets 972 3,210 Total assets of consolidated VIEs $ 406,743 $ 514,813 Liabilities of consolidated VIEs, included in total liabilities above: Notes Issued by Securitization Trust $ 214,798 $ — Warehouse Lines $ 160,207 $ 446,762 Other liabilities 550 $ — Total liabilities of consolidated VIEs $ 375,555 $ 446,762 (1) Includes amounts in consolidated variable interest entities presented separately in the table below. |
FAIR VALUE OF ASSETS AND LIAB_3
FAIR VALUE OF ASSETS AND LIABILITIES - Fair Value Hierarchy (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Aug. 31, 2023 | Jul. 31, 2023 | Dec. 31, 2022 | |
Assets: | |||||
Borrower Loans, at Fair Value | $ 545,038 | $ 320,642 | |||
Loans Held for Sale, at Fair Value | [1],[2] | 161,501 | 499,765 | ||
SOFR rate swaption (Note 11) | 90 | 1,289 | |||
Servicing Assets | 12,249 | 12,562 | |||
Credit Card Derivative (Note 5) | 36,848 | $ 300,000 | $ 200,000 | 10,782 | |
Total Assets | 755,726 | 845,040 | |||
Liabilities: | |||||
Notes, at Fair Value | 321,966 | 318,704 | |||
Convertible Preferred Stock Warrant Liability | 215,041 | 166,346 | |||
Loan Trailing Fee Liability (Note 10) | 2,942 | 3,290 | |||
Credit Card servicing obligation liability (Note 5) | 9,732 | 3,720 | |||
Total Liabilities | 549,681 | 492,060 | |||
Prosper Funding LLC | |||||
Assets: | |||||
Borrower Loans, at Fair Value | 324,311 | 320,642 | |||
Servicing Assets | 13,818 | 14,860 | |||
Total Assets | 338,129 | 335,502 | |||
Liabilities: | |||||
Notes, at Fair Value | 321,966 | 318,704 | |||
Loan Trailing Fee Liability (Note 10) | 2,942 | 3,290 | |||
Total Liabilities | 324,908 | 321,994 | |||
Level 1 Inputs | |||||
Assets: | |||||
Borrower Loans, at Fair Value | 0 | 0 | |||
Loans Held for Sale, at Fair Value | 0 | 0 | |||
SOFR rate swaption (Note 11) | 0 | 0 | |||
Servicing Assets | 0 | 0 | |||
Credit Card Derivative (Note 5) | 0 | 0 | |||
Total Assets | 0 | 0 | |||
Liabilities: | |||||
Notes, at Fair Value | 0 | 0 | |||
Convertible Preferred Stock Warrant Liability | 0 | 0 | |||
Loan Trailing Fee Liability (Note 10) | 0 | 0 | |||
Credit Card servicing obligation liability (Note 5) | 0 | 0 | |||
Total Liabilities | 0 | 0 | |||
Level 1 Inputs | Prosper Funding LLC | |||||
Assets: | |||||
Borrower Loans, at Fair Value | 0 | 0 | |||
Servicing Assets | 0 | 0 | |||
Total Assets | 0 | 0 | |||
Liabilities: | |||||
Notes, at Fair Value | 0 | 0 | |||
Loan Trailing Fee Liability (Note 10) | 0 | 0 | |||
Total Liabilities | 0 | 0 | |||
Level 2 Inputs | |||||
Assets: | |||||
Borrower Loans, at Fair Value | 0 | 0 | |||
Loans Held for Sale, at Fair Value | 0 | 0 | |||
SOFR rate swaption (Note 11) | 90 | 1,289 | |||
Servicing Assets | 0 | 0 | |||
Credit Card Derivative (Note 5) | 0 | 0 | |||
Total Assets | 90 | 1,289 | |||
Liabilities: | |||||
Notes, at Fair Value | 0 | 0 | |||
Convertible Preferred Stock Warrant Liability | 0 | 0 | |||
Loan Trailing Fee Liability (Note 10) | 0 | 0 | |||
Credit Card servicing obligation liability (Note 5) | 0 | 0 | |||
Total Liabilities | 0 | 0 | |||
Level 2 Inputs | Prosper Funding LLC | |||||
Assets: | |||||
Borrower Loans, at Fair Value | 0 | 0 | |||
Servicing Assets | 0 | 0 | |||
Total Assets | 0 | 0 | |||
Liabilities: | |||||
Notes, at Fair Value | 0 | 0 | |||
Loan Trailing Fee Liability (Note 10) | 0 | 0 | |||
Total Liabilities | 0 | 0 | |||
Level 3 Inputs | |||||
Assets: | |||||
Borrower Loans, at Fair Value | 545,038 | 320,642 | |||
Loans Held for Sale, at Fair Value | 161,501 | 499,765 | |||
SOFR rate swaption (Note 11) | 0 | 0 | |||
Servicing Assets | 12,249 | 12,562 | |||
Credit Card Derivative (Note 5) | 36,848 | 10,782 | |||
Total Assets | 755,636 | 843,751 | |||
Liabilities: | |||||
Notes, at Fair Value | 321,966 | 318,704 | |||
Convertible Preferred Stock Warrant Liability | 215,041 | 166,346 | |||
Loan Trailing Fee Liability (Note 10) | 2,942 | 3,290 | |||
Credit Card servicing obligation liability (Note 5) | 9,732 | 3,720 | |||
Total Liabilities | 549,681 | 492,060 | |||
Level 3 Inputs | Prosper Funding LLC | |||||
Assets: | |||||
Borrower Loans, at Fair Value | 324,311 | 320,642 | |||
Servicing Assets | 13,818 | 14,860 | |||
Total Assets | 338,129 | 335,502 | |||
Liabilities: | |||||
Notes, at Fair Value | 321,966 | 318,704 | |||
Loan Trailing Fee Liability (Note 10) | 2,942 | 3,290 | |||
Total Liabilities | $ 324,908 | $ 321,994 | |||
[1] The following table presents the assets and liabilities of consolidated variable interest entities (“VIEs”), which are included in the Consolidated Balance Sheets above. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. Additionally, the assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. December 31, 2023 2022 Assets of consolidated VIEs, included in total assets above: Restricted Cash $ 23,546 $ 11,838 Loans Held for Sale, at Fair Value 161,501 499,765 Borrower Loans, Held at Fair Value 220,724 — Prepaid and Other Assets 972 3,210 Total assets of consolidated VIEs $ 406,743 $ 514,813 Liabilities of consolidated VIEs, included in total liabilities above: Notes Issued by Securitization Trust $ 214,798 $ — Warehouse Lines $ 160,207 $ 446,762 Other liabilities 550 $ — Total liabilities of consolidated VIEs $ 375,555 $ 446,762 (1) Includes amounts in consolidated variable interest entities presented separately in the table below. |
FAIR VALUE OF ASSETS AND LIAB_4
FAIR VALUE OF ASSETS AND LIABILITIES - Significant Unobservable Inputs (Details) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Servicing Assets: | ||
Market rate for collection fee | 0.05% | 0.06% |
Prosper Funding LLC | ||
Servicing Assets: | ||
Market servicing rate | 0.648% | |
Market rate for collection fee | 0.05% | 0.06% |
Weighted average market servicing rate | 0.708% | |
Minimum | ||
Servicing Assets: | ||
Discount rate | 15% | 15% |
Default rate | 2.80% | 2% |
Prepayment rate | 6.10% | 14.20% |
Market servicing rate | 0.633% | 0.648% |
Weighted average market servicing rate | 0.708% | |
Minimum | Prosper Funding LLC | ||
Servicing Assets: | ||
Discount rate | 15% | 15% |
Default rate | 2.80% | 2% |
Prepayment rate | 6.10% | 14.20% |
Market servicing rate | 0.633% | |
Weighted average market servicing rate | 0.683% | |
Maximum | ||
Servicing Assets: | ||
Discount rate | 25% | 25% |
Default rate | 23.60% | 19.30% |
Prepayment rate | 30.60% | 28% |
Market servicing rate | 0.842% | 0.842% |
Weighted average market servicing rate | 0.902% | |
Maximum | Prosper Funding LLC | ||
Servicing Assets: | ||
Discount rate | 25% | 25% |
Default rate | 23.60% | 19.30% |
Prepayment rate | 30.60% | 28% |
Market servicing rate | 0.842% | 0.842% |
Weighted average market servicing rate | 0.892% | 0.902% |
Discount rate | Minimum | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.054 | 0.054 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.054 | 0.054 |
Discount rate | Minimum | Loan trailing fee liability | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.150 | 0.150 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.150 | 0.150 |
Discount rate | Minimum | Prosper Funding LLC | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.055 | 0.056 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.055 | 0.056 |
Discount rate | Minimum | Prosper Funding LLC | Loan trailing fee liability | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.150 | 0.150 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.150 | 0.150 |
Discount rate | Maximum | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.081 | 0.132 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.081 | 0.132 |
Discount rate | Maximum | Loan trailing fee liability | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.250 | 0.250 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.250 | 0.250 |
Discount rate | Maximum | Prosper Funding LLC | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.080 | 0.129 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.080 | 0.129 |
Discount rate | Maximum | Prosper Funding LLC | Loan trailing fee liability | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.250 | 0.250 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.250 | 0.250 |
Default rate | Minimum | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.032 | 0.018 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.032 | 0.018 |
Default rate | Minimum | Loan trailing fee liability | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.028 | 0.020 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.028 | 0.020 |
Default rate | Minimum | Prosper Funding LLC | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.032 | 0.018 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.032 | 0.018 |
Default rate | Minimum | Prosper Funding LLC | Loan trailing fee liability | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.028 | 0.020 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.028 | 0.020 |
Default rate | Maximum | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.236 | 0.187 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.236 | 0.187 |
Default rate | Maximum | Loan trailing fee liability | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.236 | 0.193 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.236 | 0.193 |
Default rate | Maximum | Prosper Funding LLC | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.236 | 0.182 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.236 | 0.182 |
Default rate | Maximum | Prosper Funding LLC | Loan trailing fee liability | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.236 | 0.193 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.236 | 0.193 |
Prepayment rate | Minimum | Loan trailing fee liability | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.061 | 0.142 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.061 | 0.142 |
Prepayment rate | Minimum | Prosper Funding LLC | Loan trailing fee liability | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.061 | 0.142 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.061 | 0.142 |
Prepayment rate | Maximum | Loan trailing fee liability | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.306 | 0.280 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.306 | 0.280 |
Prepayment rate | Maximum | Prosper Funding LLC | Loan trailing fee liability | ||
Borrower Loans, Loans Held for Sale, and Notes: | ||
Fair value assumptions | 0.306 | 0.280 |
Loan Trailing Fee Liability: | ||
Fair value assumptions | 0.306 | 0.280 |
FAIR VALUE OF ASSETS AND LIAB_5
FAIR VALUE OF ASSETS AND LIABILITIES - Summary of Changes in Level 3 Fair Value Assets and Liabilities (Details) - Recurring - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Total | ||
Beginning balance, total | $ 501,703 | $ 244,811 |
Purchase of Borrower Loans/Issuance of Notes | 1,921,915 | 3,063,535 |
Principal repayments | (243,695) | (169,381) |
Borrower Loans sold to third parties | (1,747,882) | (2,614,401) |
Other changes | (215) | 1,712 |
Change in fair value | (47,253) | (24,573) |
Transfer of Loans Held for Sale to Borrower Loans upon PMIT 2023-1 Transaction, at Fair Value | 0 | |
Ending balance, total | 384,573 | 501,703 |
Prosper Funding LLC | ||
Total | ||
Beginning balance, total | 1,938 | 1,641 |
Purchase of Borrower Loans/Issuance of Notes | 1,921,915 | 3,063,535 |
Borrower Loans contributed by Parent, at Fair Value | 2,010 | |
Principal repayments | (2,237) | (14,709) |
Borrower Loans sold to third parties | (1,925,775) | (3,078,249) |
Other changes | (98) | (92) |
Change in fair value | 118 | 394 |
Ending balance, total | 2,345 | 1,938 |
Notes | ||
Liabilities | ||
Beginning balance | (318,704) | (265,985) |
Purchase of Borrower Loans/Issuance of Notes | (231,520) | (285,115) |
Principal repayments | 188,670 | 202,308 |
Borrower Loans sold to third parties | 0 | 0 |
Other changes | (815) | (742) |
Change in fair value | 40,403 | 30,830 |
Transfer of Loans Held for Sale to Borrower Loans upon PMIT 2023-1 Transaction, at Fair Value | 0 | |
Ending balance | (321,966) | (318,704) |
Notes | Prosper Funding LLC | ||
Liabilities | ||
Beginning balance | (318,704) | (265,985) |
Purchase of Borrower Loans/Issuance of Notes | (231,520) | (285,115) |
Borrower Loans contributed by Parent, at Fair Value | 0 | |
Principal repayments | 188,670 | 202,308 |
Borrower Loans sold to third parties | 0 | 0 |
Other changes | (815) | (742) |
Change in fair value | 40,403 | 30,830 |
Ending balance | (321,966) | (318,704) |
Borrower Loans | ||
Assets | ||
Beginning balance, Assets | 320,642 | 267,626 |
Purchase of Borrower Loans/Issuance of Notes | 232,306 | 284,921 |
Principal repayments | (217,485) | (187,599) |
Borrower Loans sold to third parties | (4,595) | (14,520) |
Other changes | 2,906 | 650 |
Change in fair value | (48,387) | (30,436) |
Transfer of Loans Held for Sale to Borrower Loans upon PMIT 2023-1 Transaction, at Fair Value | 259,651 | |
Ending balance, Assets | 545,038 | 320,642 |
Borrower Loans | Prosper Funding LLC | ||
Assets | ||
Beginning balance, Assets | 320,642 | 267,626 |
Purchase of Borrower Loans/Issuance of Notes | 232,306 | 284,921 |
Borrower Loans contributed by Parent, at Fair Value | 2,010 | |
Principal repayments | (186,433) | (187,599) |
Borrower Loans sold to third parties | (4,646) | (14,520) |
Other changes | 717 | 650 |
Change in fair value | (40,285) | (30,436) |
Ending balance, Assets | 324,311 | 320,642 |
Loans Held for Sale | ||
Assets | ||
Beginning balance, Assets | 499,765 | 243,170 |
Purchase of Borrower Loans/Issuance of Notes | 1,921,129 | 3,063,729 |
Principal repayments | (214,880) | (184,090) |
Borrower Loans sold to third parties | (1,743,287) | (2,599,881) |
Other changes | (2,306) | 1,804 |
Change in fair value | (39,269) | (24,967) |
Transfer of Loans Held for Sale to Borrower Loans upon PMIT 2023-1 Transaction, at Fair Value | (259,651) | |
Ending balance, Assets | 161,501 | 499,765 |
Loans Held for Sale | Prosper Funding LLC | ||
Assets | ||
Beginning balance, Assets | 0 | 0 |
Purchase of Borrower Loans/Issuance of Notes | 1,921,129 | 3,063,729 |
Borrower Loans contributed by Parent, at Fair Value | 0 | |
Principal repayments | 0 | 0 |
Borrower Loans sold to third parties | (1,921,129) | (3,063,729) |
Other changes | 0 | 0 |
Change in fair value | 0 | 0 |
Ending balance, Assets | $ 0 | $ 0 |
FAIR VALUE OF ASSETS AND LIAB_6
FAIR VALUE OF ASSETS AND LIABILITIES - Schedule of Servicing Assets, Credit Card Derivative, and Convertible Preferred Stock Warrant Liability (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Servicing Assets | ||
Beginning balance, fair value | $ 12,562 | |
Ending balance, fair value | 12,249 | $ 12,562 |
Level 3 Inputs | ||
Servicing Assets | ||
Beginning balance, fair value | 12,562 | |
Ending balance, fair value | 12,249 | 12,562 |
Level 3 Inputs | Mandatorily Redeemable Preferred Stock | ||
Convertible Preferred Stock Warrant Liability | ||
Beginning balance, fair value | 166,346 | 250,941 |
Change in fair value | 48,695 | (84,595) |
Ending balance, fair value | 215,041 | 166,346 |
Level 3 Inputs | Credit Card Derivative (Note 5) | Derivative | ||
Credit Card Derivative | ||
Beginning balance, Assets | 10,782 | 7 |
Change in fair value | 26,066 | 9,784 |
Net gains (losses) from settled transactions | (561) | 4,295 |
Less: Net payments made | 561 | (3,304) |
Ending balance, Assets | 36,848 | 10,782 |
Level 3 Inputs | Credit Card Servicing Obligation Liability | ||
Convertible Preferred Stock Warrant Liability | ||
Beginning balance, fair value | 3,720 | 0 |
Change in fair value | (6,012) | (3,720) |
Ending balance, fair value | 9,732 | 3,720 |
Prosper Funding LLC | ||
Servicing Assets | ||
Beginning balance, fair value | 14,860 | |
Ending balance, fair value | 13,818 | 14,860 |
Prosper Funding LLC | Level 3 Inputs | ||
Servicing Assets | ||
Beginning balance, fair value | 14,860 | |
Ending balance, fair value | 13,818 | 14,860 |
Servicing Assets | ||
Servicing Assets | ||
Beginning balance, fair value | 12,562 | |
Ending balance, fair value | 12,249 | 12,562 |
Servicing Assets | Level 3 Inputs | ||
Servicing Assets | ||
Beginning balance, fair value | 12,562 | 8,761 |
Additions | 9,238 | 12,957 |
Less: Change in fair value | (9,551) | (9,156) |
Ending balance, fair value | 12,249 | 12,562 |
Servicing Assets | Prosper Funding LLC | ||
Servicing Assets | ||
Beginning balance, fair value | 14,860 | |
Ending balance, fair value | 13,818 | 14,860 |
Servicing Assets | Prosper Funding LLC | Level 3 Inputs | ||
Servicing Assets | ||
Beginning balance, fair value | 14,860 | 9,796 |
Additions | 10,151 | 15,277 |
Less: Change in fair value | (11,193) | (10,213) |
Ending balance, fair value | $ 13,818 | $ 14,860 |
FAIR VALUE OF ASSETS AND LIAB_7
FAIR VALUE OF ASSETS AND LIABILITIES - Loan Trailing Fee Liability (Details) - Trailing Fee - Level 3 Inputs - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Liabilities | ||
Beginning balance, fair value | $ 3,290 | $ 2,161 |
Issuances | 2,011 | 3,070 |
Cash payment of Loan Trailing Fee | (2,791) | (2,245) |
Change in fair value | 432 | 304 |
Ending balance, fair value | 2,942 | 3,290 |
Prosper Funding LLC | ||
Liabilities | ||
Beginning balance, fair value | 3,290 | 2,161 |
Issuances | 2,011 | 3,070 |
Cash payment of Loan Trailing Fee | (2,791) | (2,245) |
Change in fair value | 432 | 304 |
Ending balance, fair value | $ 2,942 | $ 3,290 |
FAIR VALUE OF ASSETS AND LIAB_8
FAIR VALUE OF ASSETS AND LIABILITIES - Assumptions for Borrower Loans, Loans Held for Sale and Notes (Details) $ in Thousands | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) |
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower Loans, at Fair Value | $ 545,038 | $ 320,642 |
Notes, at Fair Value | 321,966 | 318,704 |
Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes, at Fair Value | 321,966 | 318,704 |
Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower Loans, at Fair Value | 324,311 | 320,642 |
Notes, at Fair Value | 321,966 | 318,704 |
Prosper Funding LLC | Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes, at Fair Value | 321,966 | 318,704 |
Notes | Prosper Funding LLC | Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes, at Fair Value | 321,966 | 318,704 |
Notes | Discount rate assumption | 100 basis point increase | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 318,877 | 315,456 |
Notes | Discount rate assumption | 100 basis point increase | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 318,877 | 315,456 |
Notes | Discount rate assumption | 200 basis point increase | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 315,863 | 312,291 |
Notes | Discount rate assumption | 200 basis point increase | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 315,863 | 312,291 |
Notes | Discount rate assumption | 100 basis point decrease | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 325,134 | 322,037 |
Notes | Discount rate assumption | 100 basis point decrease | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 325,134 | 322,037 |
Notes | Discount rate assumption | 200 basis point decrease | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 328,384 | 325,461 |
Notes | Discount rate assumption | 200 basis point decrease | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 328,384 | 325,461 |
Notes | Default rate assumption | Applying a 1.1 multiplier to default rate | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 317,359 | 314,892 |
Notes | Default rate assumption | Applying a 1.1 multiplier to default rate | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 317,359 | 314,892 |
Notes | Default rate assumption | Applying a 1.2 multiplier to default rate | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 312,800 | 311,112 |
Notes | Default rate assumption | Applying a 1.2 multiplier to default rate | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 312,800 | 311,112 |
Notes | Default rate assumption | Applying a 0.9 multiplier to default rate | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 326,621 | 322,547 |
Notes | Default rate assumption | Applying a 0.9 multiplier to default rate | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 326,621 | 322,547 |
Notes | Default rate assumption | Applying a 0.8 multiplier to default rate | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 331,325 | 326,425 |
Notes | Default rate assumption | Applying a 0.8 multiplier to default rate | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 331,325 | 326,425 |
Borrower Loans / Loans Held for Sale | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower Loans, at Fair Value | 706,539 | 820,407 |
Borrower Loans / Loans Held for Sale | Discount rate assumption | 100 basis point increase | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 699,770 | 812,061 |
Borrower Loans / Loans Held for Sale | Discount rate assumption | 100 basis point increase | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 321,204 | |
Borrower Loans / Loans Held for Sale | Discount rate assumption | 200 basis point increase | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 693,167 | 803,927 |
Borrower Loans / Loans Held for Sale | Discount rate assumption | 200 basis point increase | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 318,174 | |
Borrower Loans / Loans Held for Sale | Discount rate assumption | 100 basis point decrease | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 713,481 | 828,975 |
Borrower Loans / Loans Held for Sale | Discount rate assumption | 100 basis point decrease | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 327,498 | |
Borrower Loans / Loans Held for Sale | Discount rate assumption | 200 basis point decrease | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 720,601 | 837,773 |
Borrower Loans / Loans Held for Sale | Discount rate assumption | 200 basis point decrease | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 330,766 | |
Borrower Loans / Loans Held for Sale | Default rate assumption | Applying a 1.1 multiplier to default rate | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 696,510 | 810,657 |
Borrower Loans / Loans Held for Sale | Default rate assumption | Applying a 1.1 multiplier to default rate | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 319,708 | |
Borrower Loans / Loans Held for Sale | Default rate assumption | Applying a 1.2 multiplier to default rate | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 686,586 | 800,989 |
Borrower Loans / Loans Held for Sale | Default rate assumption | Applying a 1.2 multiplier to default rate | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 315,153 | |
Borrower Loans / Loans Held for Sale | Default rate assumption | Applying a 0.9 multiplier to default rate | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 716,671 | 830,238 |
Borrower Loans / Loans Held for Sale | Default rate assumption | Applying a 0.9 multiplier to default rate | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 328,962 | |
Borrower Loans / Loans Held for Sale | Default rate assumption | Applying a 0.8 multiplier to default rate | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 726,910 | 840,156 |
Borrower Loans / Loans Held for Sale | Default rate assumption | Applying a 0.8 multiplier to default rate | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | $ 333,662 | |
Borrower Loans / Loans Held for Sale | Notes | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower Loans, at Fair Value | 320,642 | |
Borrower Loans / Loans Held for Sale | Notes | Discount rate assumption | 100 basis point increase | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 317,380 | |
Borrower Loans / Loans Held for Sale | Notes | Discount rate assumption | 200 basis point increase | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 314,201 | |
Borrower Loans / Loans Held for Sale | Notes | Discount rate assumption | 100 basis point decrease | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 323,991 | |
Borrower Loans / Loans Held for Sale | Notes | Discount rate assumption | 200 basis point decrease | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 327,429 | |
Borrower Loans / Loans Held for Sale | Notes | Default rate assumption | Applying a 1.1 multiplier to default rate | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 316,832 | |
Borrower Loans / Loans Held for Sale | Notes | Default rate assumption | Applying a 1.2 multiplier to default rate | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 313,053 | |
Borrower Loans / Loans Held for Sale | Notes | Default rate assumption | Applying a 0.9 multiplier to default rate | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 324,484 | |
Borrower Loans / Loans Held for Sale | Notes | Default rate assumption | Applying a 0.8 multiplier to default rate | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | $ 328,361 | |
Discount rate | Notes | Discount rate assumption | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Fair value assumptions | 0.0655 | 0.0687 |
Discount rate | Notes | Discount rate assumption | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Fair value assumptions | 0.0655 | 0.0687 |
Discount rate | Borrower Loans / Loans Held for Sale | Discount rate assumption | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Fair value assumptions | 0.0688 | 0.0672 |
Discount rate | Borrower Loans / Loans Held for Sale | Discount rate assumption | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Fair value assumptions | 0.0655 | |
Discount rate | Borrower Loans / Loans Held for Sale | Notes | Discount rate assumption | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Fair value assumptions | 0.0687 | |
Default rate | Notes | Default rate assumption | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Fair value assumptions | 0.1421 | 0.1136 |
Default rate | Notes | Default rate assumption | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Fair value assumptions | 0.1421 | 0.1136 |
Default rate | Borrower Loans / Loans Held for Sale | Default rate assumption | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Fair value assumptions | 0.1244 | 0.0931 |
Default rate | Borrower Loans / Loans Held for Sale | Default rate assumption | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Fair value assumptions | 0.1436 | |
Default rate | Borrower Loans / Loans Held for Sale | Notes | Default rate assumption | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Fair value assumptions | 0.1136 |
FAIR VALUE OF ASSETS AND LIAB_9
FAIR VALUE OF ASSETS AND LIABILITIES - Schedule Assumptions and the Sensitivity of the Fair Value (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Servicing Assets | $ 12,249 | $ 12,562 |
Servicing rate increase | 0.025% | |
Servicing rate decrease | 0.025% | |
Prepayment rate increase | 110% | |
Prepayment rate decrease | 90% | |
Default rate increase | 110% | |
Default rate decrease | 90% | |
Prosper Funding LLC | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Servicing Assets | $ 13,818 | 14,860 |
Servicing rate increase | 0.025% | |
Servicing rate decrease | 0.025% | |
Prepayment rate increase | 1.10% | |
Prepayment rate decrease | 0.90% | |
Default rate increase | 1.10% | |
Default rate decrease | 0.90% | |
Servicing Assets | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Servicing Assets | $ 12,249 | 12,562 |
Servicing Assets | Prosper Funding LLC | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Servicing Assets | 13,818 | 14,860 |
Market servicing rate | Servicing Assets | Market servicing rate increase of 0.025% | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Expected fair value with change in assumptions | 11,475 | 11,708 |
Market servicing rate | Servicing Assets | Market servicing rate increase of 0.025% | Prosper Funding LLC | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Expected fair value with change in assumptions | 12,945 | 13,850 |
Market servicing rate | Servicing Assets | Market servicing rate decrease of 0.025% | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Expected fair value with change in assumptions | 13,023 | 13,415 |
Market servicing rate | Servicing Assets | Market servicing rate decrease of 0.025% | Prosper Funding LLC | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Expected fair value with change in assumptions | 14,691 | 15,870 |
Prepayment rate assumption | Servicing Assets | Applying a 1.1 multiplier to prepayment rate | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Expected fair value with change in assumptions | 11,969 | 12,286 |
Prepayment rate assumption | Servicing Assets | Applying a 1.1 multiplier to prepayment rate | Prosper Funding LLC | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Expected fair value with change in assumptions | 13,502 | 14,534 |
Prepayment rate assumption | Servicing Assets | Applying a 0.9 multiplier to prepayment rate | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Expected fair value with change in assumptions | 12,533 | 12,842 |
Prepayment rate assumption | Servicing Assets | Applying a 0.9 multiplier to prepayment rate | Prosper Funding LLC | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Expected fair value with change in assumptions | 14,139 | 15,191 |
Default rate assumption | Servicing Assets | Applying a 1.1 multiplier to default rate | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Expected fair value with change in assumptions | 11,998 | 12,305 |
Default rate assumption | Servicing Assets | Applying a 1.1 multiplier to default rate | Prosper Funding LLC | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Expected fair value with change in assumptions | 13,534 | 14,557 |
Default rate assumption | Servicing Assets | Applying a 0.9 multiplier to default rate | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Expected fair value with change in assumptions | 12,503 | 12,820 |
Default rate assumption | Servicing Assets | Applying a 0.9 multiplier to default rate | Prosper Funding LLC | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Expected fair value with change in assumptions | $ 14,104 | $ 15,165 |
Market servicing rate | Servicing Assets | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Valuation techniques | 0.65% | 0.65% |
Market servicing rate | Servicing Assets | Prosper Funding LLC | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Valuation techniques | 0.65% | 0.649% |
Prepayment rate | Servicing Assets | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Valuation techniques | 19.55% | 18.47% |
Prepayment rate | Servicing Assets | Prosper Funding LLC | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Valuation techniques | 19.96% | 18.77% |
Default rate | Servicing Assets | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Valuation techniques | 15.25% | 13.38% |
Default rate | Servicing Assets | Prosper Funding LLC | ||
Servicing Assets And Liabilities Fair Value [Line Items] | ||
Valuation techniques | 14.74% | 12.63% |
FAIR VALUE OF ASSETS AND LIA_10
FAIR VALUE OF ASSETS AND LIABILITIES - Schedule Credit Card Derivative Asset (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Aug. 31, 2023 USD ($) | Jul. 31, 2023 USD ($) | |
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Credit Card Derivative | $ 36,848 | $ 10,782 | $ 300,000 | $ 200,000 |
Credit Card Derivative (Note 5) | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Prosper Credit Card portfolio | $ 286,284 | $ 113,917 | ||
Credit Card Derivative (Note 5) | Discount rate on Prosper Credit Card portfolio | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Valuation techniques | 0.2319 | 0.2623 | ||
Credit Card Derivative (Note 5) | Discount rate on Coastal Program Fee | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Valuation techniques | 0.0741 | 0.0926 | ||
Credit Card Derivative (Note 5) | Prepayment rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Valuation techniques | 0.0814 | 0.1008 | ||
Credit Card Derivative (Note 5) | Prepayment rate | Applying a 1.1 multiplier to prepayment rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Expected fair value with change in assumptions | $ 36,374 | $ 10,625 | ||
Credit Card Derivative (Note 5) | Prepayment rate | Applying a 0.9 multiplier to prepayment rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Expected fair value with change in assumptions | $ 37,328 | $ 10,942 | ||
Credit Card Derivative (Note 5) | Default rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Valuation techniques | 0.1436 | 0.1334 | ||
Credit Card Derivative (Note 5) | Default rate | Applying a 1.1 multiplier to default rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Expected fair value with change in assumptions | $ 29,659 | $ 8,001 | ||
Credit Card Derivative (Note 5) | Default rate | Applying a 0.9 multiplier to default rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Expected fair value with change in assumptions | 44,256 | 13,641 | ||
Credit Card Derivative (Note 5) | Discount rate | 100 basis point increase in both discount rates | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Expected fair value with change in assumptions | 36,452 | 10,699 | ||
Credit Card Derivative (Note 5) | Discount rate | 200 basis point increase in both discount rates | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Expected fair value with change in assumptions | 36,065 | 10,618 | ||
Credit Card Derivative (Note 5) | Discount rate | 100 basis point decrease in both discount rates | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Expected fair value with change in assumptions | 37,253 | 10,866 | ||
Credit Card Derivative (Note 5) | Discount rate | 200 basis point decrease in both discount rates | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Expected fair value with change in assumptions | $ 37,668 | 10,951 | ||
Credit Card Servicing Obligation Liability | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Derivative liability | $ 3,720 | |||
Credit Card Servicing Obligation Liability | Discount rate on Prosper Credit Card portfolio | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Derivative liability, measurement input | 0.0741 | 0.0926 | ||
Credit Card Servicing Obligation Liability | Prepayment rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Derivative liability, measurement input | 0.0814 | 0.1008 | ||
Credit Card Servicing Obligation Liability | Prepayment rate | Applying a 1.1 multiplier to prepayment rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Derivative liability, expected fair value with change in assumptions | $ 9,609 | $ 3,662 | ||
Credit Card Servicing Obligation Liability | Prepayment rate | Applying a 0.9 multiplier to prepayment rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Derivative liability, expected fair value with change in assumptions | $ 9,858 | $ 3,779 | ||
Credit Card Servicing Obligation Liability | Default rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Derivative liability, measurement input | 0.1436 | 0.1334 | ||
Credit Card Servicing Obligation Liability | Default rate | Applying a 1.1 multiplier to default rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Derivative liability, expected fair value with change in assumptions | $ 9,487 | $ 3,636 | ||
Credit Card Servicing Obligation Liability | Default rate | Applying a 0.9 multiplier to default rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Derivative liability, expected fair value with change in assumptions | $ 9,984 | $ 3,806 | ||
Credit Card Servicing Obligation Liability | Market servicing rate | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Derivative liability, measurement input | 0.0200 | 0.0200 | ||
Credit Card Servicing Obligation Liability | Discount rate | 100 basis point increase in both discount rates | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Derivative liability, expected fair value with change in assumptions | $ 10,253 | $ 3,919 | ||
Credit Card Servicing Obligation Liability | Discount rate | 100 basis point decrease in both discount rates | ||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||
Derivative liability, expected fair value with change in assumptions | $ 9,213 | $ 3,521 |
FAIR VALUE OF ASSETS AND LIA_11
FAIR VALUE OF ASSETS AND LIABILITIES - Schedule of Assets and Liabilities Not Recorded at Fair Value (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Mar. 21, 2022 | Dec. 31, 2021 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Cash and Cash Equivalents | $ 34,970 | $ 83,446 | $ 67,700 | ||||
Restricted Cash | 120,298 | [1],[2] | 113,163 | [1],[2] | $ 167,925 | ||
Accounts Receivable | 7,523 | 3,462 | |||||
Total Assets | 1,018,042 | 1,128,404 | |||||
Accounts Payable and Accrued Liabilities | 40,906 | 37,254 | |||||
Payable to Investors | 86,732 | 85,312 | |||||
Notes issued by securitization trust | [1],[2] | 214,798 | 0 | ||||
Warehouse Lines | [1],[2] | 160,207 | 446,762 | ||||
Paycheck Protection Program loan (Note 11) | $ 8,600 | ||||||
Total Liabilities | 1,150,222 | 1,156,043 | |||||
Carrying Amount | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Cash and Cash Equivalents | 34,970 | 83,446 | |||||
Accounts Receivable | 7,523 | 3,462 | |||||
Total Assets | 162,791 | 200,071 | |||||
Accounts Payable and Accrued Liabilities | 40,906 | 37,254 | |||||
Payable to Investors | 86,732 | 85,312 | |||||
Notes issued by securitization trust | 214,798 | ||||||
Warehouse Lines | 160,207 | 446,762 | |||||
Term Loan (Note 11) | 75,313 | ||||||
Paycheck Protection Program loan (Note 11) | 73,407 | ||||||
Total Liabilities | 577,956 | 642,735 | |||||
Carrying Amount | Restricted Cash - Cash and Cash Equivalents | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Restricted Cash | 117,270 | 108,284 | |||||
Carrying Amount | Restricted Cash - Certificates of Deposit | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Restricted Cash | 3,028 | 4,879 | |||||
Fair Value | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Cash and Cash Equivalents | 34,970 | 83,446 | |||||
Accounts Receivable | 7,523 | 3,462 | |||||
Total Assets | 162,791 | 200,071 | |||||
Accounts Payable and Accrued Liabilities | 40,906 | 37,254 | |||||
Payable to Investors | 86,732 | 85,312 | |||||
Notes issued by securitization trust | 208,005 | ||||||
Warehouse Lines | 157,972 | 444,329 | |||||
Term Loan (Note 11) | 77,837 | ||||||
Paycheck Protection Program loan (Note 11) | 76,191 | ||||||
Total Liabilities | 571,452 | 643,086 | |||||
Fair Value | Restricted Cash - Cash and Cash Equivalents | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Restricted Cash | 117,270 | 108,284 | |||||
Fair Value | Restricted Cash - Certificates of Deposit | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Restricted Cash | 3,028 | 4,879 | |||||
Level 1 Inputs | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Cash and Cash Equivalents | 34,970 | 83,446 | |||||
Accounts Receivable | 0 | 0 | |||||
Total Assets | 152,240 | 191,730 | |||||
Accounts Payable and Accrued Liabilities | 0 | 0 | |||||
Payable to Investors | 0 | 0 | |||||
Notes issued by securitization trust | 0 | ||||||
Warehouse Lines | 0 | 0 | |||||
Term Loan (Note 11) | 0 | ||||||
Paycheck Protection Program loan (Note 11) | 0 | ||||||
Total Liabilities | 0 | 0 | |||||
Level 1 Inputs | Restricted Cash - Cash and Cash Equivalents | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Restricted Cash | 117,270 | 108,284 | |||||
Level 1 Inputs | Restricted Cash - Certificates of Deposit | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Restricted Cash | 0 | 0 | |||||
Level 2 Inputs | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Cash and Cash Equivalents | 0 | 0 | |||||
Accounts Receivable | 7,523 | 3,462 | |||||
Total Assets | 10,551 | 8,341 | |||||
Accounts Payable and Accrued Liabilities | 40,906 | 37,254 | |||||
Payable to Investors | 86,732 | 85,312 | |||||
Notes issued by securitization trust | 208,005 | ||||||
Warehouse Lines | 157,972 | 444,329 | |||||
Term Loan (Note 11) | 77,837 | ||||||
Paycheck Protection Program loan (Note 11) | 76,191 | ||||||
Total Liabilities | 571,452 | 643,086 | |||||
Level 2 Inputs | Restricted Cash - Cash and Cash Equivalents | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Restricted Cash | 0 | 0 | |||||
Level 2 Inputs | Restricted Cash - Certificates of Deposit | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Restricted Cash | 3,028 | 4,879 | |||||
Level 3 Inputs | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Cash and Cash Equivalents | 0 | 0 | |||||
Accounts Receivable | 0 | 0 | |||||
Total Assets | 0 | 0 | |||||
Accounts Payable and Accrued Liabilities | 0 | 0 | |||||
Payable to Investors | 0 | 0 | |||||
Notes issued by securitization trust | 0 | ||||||
Warehouse Lines | 0 | 0 | |||||
Term Loan (Note 11) | 0 | ||||||
Paycheck Protection Program loan (Note 11) | 0 | ||||||
Total Liabilities | 0 | 0 | |||||
Level 3 Inputs | Restricted Cash - Cash and Cash Equivalents | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Restricted Cash | 0 | 0 | |||||
Level 3 Inputs | Restricted Cash - Certificates of Deposit | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Restricted Cash | $ 0 | $ 0 | |||||
[1] The following table presents the assets and liabilities of consolidated variable interest entities (“VIEs”), which are included in the Consolidated Balance Sheets above. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. Additionally, the assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. December 31, 2023 2022 Assets of consolidated VIEs, included in total assets above: Restricted Cash $ 23,546 $ 11,838 Loans Held for Sale, at Fair Value 161,501 499,765 Borrower Loans, Held at Fair Value 220,724 — Prepaid and Other Assets 972 3,210 Total assets of consolidated VIEs $ 406,743 $ 514,813 Liabilities of consolidated VIEs, included in total liabilities above: Notes Issued by Securitization Trust $ 214,798 $ — Warehouse Lines $ 160,207 $ 446,762 Other liabilities 550 $ — Total liabilities of consolidated VIEs $ 375,555 $ 446,762 (1) Includes amounts in consolidated variable interest entities presented separately in the table below. |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill [Line Items] | |||
Goodwill | $ 36,368,000 | $ 36,368,000 | |
Goodwill impairment expense | 0 | 0 | $ 0 |
Intangible additions | 0 | 0 | |
Impairment of intangible assets | 0 | 0 | 0 |
Net carrying value | 85,000 | 192,000 | |
Amortization of intangible assets | 107,000 | 136,000 | $ 172,000 |
User base and customer relationships | |||
Goodwill [Line Items] | |||
Net carrying value | $ 85,000 | $ 192,000 | |
Remaining Useful Life (In Years) | 1 year 3 months 18 days | 2 years 3 months 18 days | |
Minimum | User base and customer relationships | |||
Goodwill [Line Items] | |||
Remaining Useful Life (In Years) | 3 years |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Other Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 8,170 | $ 8,170 |
Accumulated Amortization | (8,085) | (7,978) |
Net Carrying Value | 85 | 192 |
Developed technology | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 3,060 | 3,060 |
Accumulated Amortization | (3,060) | (3,060) |
Net Carrying Value | 0 | 0 |
User base and customer relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 5,050 | 5,050 |
Accumulated Amortization | (4,965) | (4,858) |
Net Carrying Value | $ 85 | $ 192 |
Remaining Useful Life (In Years) | 1 year 3 months 18 days | 2 years 3 months 18 days |
Brand name | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 60 | $ 60 |
Accumulated Amortization | (60) | (60) |
Net Carrying Value | $ 0 | $ 0 |
Remaining Useful Life (In Years) | 1 year |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Estimated Amortization (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2023 | $ 85 |
Net Carrying Value | $ 85 |
OTHER LIABILITIES (Details)
OTHER LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Other Liabilities [Abstract] | ||
Operating lease liabilities (Note 16) | $ 14,431 | $ 16,351 |
Deferred revenue | 6,373 | 3,880 |
Credit Card servicing obligation liability (Note 5) | 9,732 | 3,720 |
Loan trailing fee liability | 2,942 | 3,290 |
Deferred income tax liability | 721 | 658 |
Other | 1,060 | 359 |
Total Other Liabilities | $ 35,259 | $ 28,258 |
Operating lease liability, location | Total Other Liabilities | Total Other Liabilities |
DEBT (Details)
DEBT (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||||||||||||||
May 05, 2023 USD ($) | Feb. 10, 2023 USD ($) | Mar. 04, 2021 USD ($) | Jun. 20, 2019 | Apr. 30, 2020 USD ($) | Dec. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | Sep. 25, 2023 USD ($) | Aug. 31, 2023 USD ($) | Jul. 31, 2023 USD ($) | May 04, 2023 USD ($) | Feb. 09, 2023 USD ($) | Dec. 31, 2022 USD ($) | Nov. 14, 2022 USD ($) | Mar. 21, 2022 USD ($) | Dec. 31, 2021 USD ($) | May 19, 2021 USD ($) | Mar. 28, 2019 USD ($) | Jun. 12, 2018 USD ($) | Jan. 19, 2018 USD ($) | |||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Warehouse Lines | [1],[2] | $ 160,207 | $ 160,207 | $ 446,762 | ||||||||||||||||||||
Loans held for sale | [1],[2] | 161,501 | 161,501 | 499,765 | ||||||||||||||||||||
Restricted Cash | 120,298 | [1],[2] | 120,298 | [1],[2] | 113,163 | [1],[2] | $ 167,925 | |||||||||||||||||
Derivative asset | 36,848 | 36,848 | $ 300,000 | $ 200,000 | 10,782 | |||||||||||||||||||
Paycheck Protection Program loan (Note 11) | $ 8,600 | |||||||||||||||||||||||
Prosper Funding LLC | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Restricted Cash | 93,688 | 93,688 | 91,564 | $ 157,111 | ||||||||||||||||||||
VIE, Primary Beneficiary | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Warehouse Lines | 160,207 | 160,207 | 446,762 | |||||||||||||||||||||
Loans held for sale | 161,501 | 161,501 | 499,765 | |||||||||||||||||||||
Restricted Cash | 23,546 | 23,546 | 11,838 | |||||||||||||||||||||
VIE, Primary Beneficiary | Securtization Trust PMT 2023-1 | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Face amount | $ 273,800 | |||||||||||||||||||||||
Restricted Cash | 12,600 | |||||||||||||||||||||||
Securitization amount | 266,100 | $ 275,900 | ||||||||||||||||||||||
Debt issuance costs, line of credit arrangement | 1,900 | |||||||||||||||||||||||
VIE, Primary Beneficiary | Securtization Trust PMT 2023-1 | Prosper Funding LLC | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Face amount | 7,700 | |||||||||||||||||||||||
SOFR rate swaption (Note 11) | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Derivative asset | $ 100 | $ 100 | 1,300 | |||||||||||||||||||||
Credit Agreement | Line of Credit | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Face amount | $ 75,000 | |||||||||||||||||||||||
Debt issuance costs, net | $ 400 | |||||||||||||||||||||||
Credit Agreement | Line of Credit | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Basis spread on variable rate | 9% | |||||||||||||||||||||||
Credit Agreement | Line of Credit | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Minimum | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt instrument, interest rate, paid-in-kind, stated rate | 2% | 2% | ||||||||||||||||||||||
Warehouse Agreement | Revolving Credit Facility | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Minimum tangible net worth | $ 25,000 | |||||||||||||||||||||||
Minimum net liquidity | $ 15,000 | |||||||||||||||||||||||
Maximum leverage ratio | 5 | |||||||||||||||||||||||
PWIT Warehouse Line | Revolving Credit Facility | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Line of credit | $ 200,000 | $ 100,000 | ||||||||||||||||||||||
Repayment period | 12 months | |||||||||||||||||||||||
Warehouse Lines | $ 160,200 | $ 160,200 | ||||||||||||||||||||||
Loans held for sale | 169,500 | 169,500 | ||||||||||||||||||||||
Restricted Cash | 10,100 | 10,100 | ||||||||||||||||||||||
Remaining borrowing capacity | 86,000 | 86,000 | ||||||||||||||||||||||
Debt issuance costs | $ 2,200 | $ 2,200 | $ 300 | |||||||||||||||||||||
Step-up fee, percentage | 0.01 | |||||||||||||||||||||||
Debt instrument, basis spread on variable rate, decrease | 0.01 | |||||||||||||||||||||||
Debt instrument, basis spread on variable rate, maximum decrease | 0.865 | |||||||||||||||||||||||
PWIT Warehouse Line | Revolving Credit Facility | SOFR rate swaption (Note 11) | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Change in fair value | $ (1,200) | $ (1,200) | $ 800 | |||||||||||||||||||||
PWIIT Warehouse Line | Revolving Credit Facility | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Line of credit | $ 244,000 | $ 450,000 | $ 300,000 | 300,000 | $ 200,000 | $ 300,000 | $ 300,000 | |||||||||||||||||
Line of credit facility, covenant terms, advance rate | 91.50% | |||||||||||||||||||||||
Warehouse Lines | $ 224,000 | |||||||||||||||||||||||
PWIIT Warehouse Line | Revolving Credit Facility | SOFR rate swaption (Note 11) | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Derivative, notional amount | $ 185,000 | |||||||||||||||||||||||
PWIIT Warehouse Line, Class A | Revolving Credit Facility | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Line of credit | $ 200,000 | $ 400,000 | $ 230,000 | 265,000 | ||||||||||||||||||||
Debt instrument, basis spread on variable rate, annual increase | 0.15% | |||||||||||||||||||||||
Commitment fee percentage | 0.50% | |||||||||||||||||||||||
PWIIT Warehouse Line, Class A | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Revolving Credit Facility | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Basis spread on variable rate | 2.75% | |||||||||||||||||||||||
PWIIT Warehouse Line, Class A | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Minimum | Revolving Credit Facility | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Debt instrument, basis spread on variable rate, annual increase | 8.50% | |||||||||||||||||||||||
PWIIT Warehouse Line, Class A | National Banking Associations Asset-Backed Commercial Paper Rate | Revolving Credit Facility | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Basis spread on variable rate | 2.85% | |||||||||||||||||||||||
PWIIT Warehouse Line, Class B | Revolving Credit Facility | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Line of credit | $ 44,000 | $ 50,000 | $ 70,000 | $ 35,000 | ||||||||||||||||||||
PWIIT Warehouse Line, Class B | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Revolving Credit Facility | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Basis spread on variable rate | 8.75% | |||||||||||||||||||||||
PPP Loan | ||||||||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||||||||
Face amount | $ 8,400 | |||||||||||||||||||||||
Interest rate | 1% | |||||||||||||||||||||||
Term | 2 years | |||||||||||||||||||||||
[1] The following table presents the assets and liabilities of consolidated variable interest entities (“VIEs”), which are included in the Consolidated Balance Sheets above. The assets in the table below may only be used to settle obligations of consolidated VIEs and are in excess of those obligations. Additionally, the assets and liabilities in the table below include third-party assets and liabilities of consolidated VIEs only and exclude intercompany balances that eliminate in consolidation. December 31, 2023 2022 Assets of consolidated VIEs, included in total assets above: Restricted Cash $ 23,546 $ 11,838 Loans Held for Sale, at Fair Value 161,501 499,765 Borrower Loans, Held at Fair Value 220,724 — Prepaid and Other Assets 972 3,210 Total assets of consolidated VIEs $ 406,743 $ 514,813 Liabilities of consolidated VIEs, included in total liabilities above: Notes Issued by Securitization Trust $ 214,798 $ — Warehouse Lines $ 160,207 $ 446,762 Other liabilities 550 $ — Total liabilities of consolidated VIEs $ 375,555 $ 446,762 (1) Includes amounts in consolidated variable interest entities presented separately in the table below. |
NET INCOME (LOSS) PER SHARE - B
NET INCOME (LOSS) PER SHARE - Basic and Diluted Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Numerator: | |||
Net (Loss) Income | $ (106,462) | $ 70,582 | $ (138,341) |
Less: Net Income Allocated to Participating Securities | 0 | (47,350) | 0 |
Net (Loss) Income Attributable to Common Stockholders | (106,462) | 23,232 | (138,341) |
Net (Loss) Income Attributable to Common Stockholders, Diluted | $ (106,462) | $ 23,232 | $ (138,341) |
Denominator: | |||
Weighted average shares used in computing basic and diluted Net (Loss) Income Per Share (in shares) | 76,092,569 | 73,291,714 | 70,767,275 |
Effect of dilutive securities: | |||
Stock options (in shares) | 0 | 61,466,722 | 0 |
Warrants (in shares) | 0 | 570,313 | 0 |
Convertible preferred stock warrants (in shares) | 0 | 213,264,845 | 0 |
Weighted average shares used in computing diluted Net (Loss) Income Per Share (in shares) | 76,092,569 | 348,593,594 | 70,767,275 |
Net (Loss) Income Per Share – Basic (in dollars per share) | $ (1.40) | $ 0.32 | $ (1.95) |
Net (Loss) Income Per Share – Diluted (in dollars per share) | $ (1.40) | $ 0.07 | $ (1.95) |
NET INCOME (LOSS) PER SHARE - C
NET INCOME (LOSS) PER SHARE - Computation of Diluted Net Income (Loss) Per Share (Details) - shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total excluded securities (in shares) | 453,573,945 | 176,579,241 | 445,467,557 |
Convertible Preferred Stock issued and outstanding | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total excluded securities (in shares) | 158,365,655 | 158,365,655 | 158,365,655 |
Stock options issued and outstanding | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total excluded securities (in shares) | 80,863,096 | 17,703,550 | 72,756,708 |
Warrants issued and outstanding | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total excluded securities (in shares) | 1,080,349 | 510,036 | 1,080,349 |
Series E-1 Convertible Preferred Stock warrants | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total excluded securities (in shares) | 35,544,141 | 0 | 35,544,141 |
Series F Convertible Preferred Stock warrants | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total excluded securities (in shares) | 177,720,704 | 0 | 177,720,704 |
CONVERTIBLE PREFERRED STOCK, _3
CONVERTIBLE PREFERRED STOCK, CONVERTIBLE PREFERRED STOCK WARRANT LIABILITY AND COMMON STOCK - Additional Information (Details) | 1 Months Ended | 12 Months Ended | |||||||||||||||
Jul. 21, 2020 shares | Dec. 23, 2019 shares | Sep. 20, 2017 USD ($) $ / shares shares | Feb. 27, 2017 $ / shares shares | Dec. 16, 2016 $ / shares shares | Feb. 16, 2016 | Jul. 16, 2014 USD ($) shares | Jun. 18, 2014 $ / shares shares | Apr. 30, 2015 USD ($) $ / shares shares | May 31, 2014 USD ($) $ / shares shares | Sep. 30, 2013 USD ($) $ / shares shares | Jan. 31, 2013 USD ($) $ / shares shares | Dec. 31, 2023 USD ($) time vote $ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) shares | Dec. 31, 2020 shares | Dec. 31, 2016 shares | |
Class of Stock [Line Items] | |||||||||||||||||
Stock split conversion ratio | 1 | ||||||||||||||||
Common stock convertible ratio if preferred stock did not participate | 10 | ||||||||||||||||
Convertible preferred stock, authorized (in shares) | 444,760,848 | 444,760,848 | |||||||||||||||
Shares authorized to be repurchased (in shares) | 7,221,020 | ||||||||||||||||
Dividends | $ | $ 0 | ||||||||||||||||
Fair value, liability, recurring basis, unobservable input reconciliation, gain (loss), statement of income or comprehensive income [Extensible Enumeration] | Change in Fair Value of Financial Instruments | Change in Fair Value of Financial Instruments | |||||||||||||||
Fair value adjustment of warrants | $ | $ 48,695,000 | $ (84,595,000) | $ 138,622,000 | ||||||||||||||
Common and preferred stock, shares authorized (in shares) | 1,069,760,848 | ||||||||||||||||
Common stock, authorized (in shares) | 625,000,000 | 625,000,000 | 625,000,000 | ||||||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | ||||||||||||||
Preferred stock, shares authorized | 444,760,848 | ||||||||||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||||||||||||||||
Common stock, issued (in shares) | 77,861,329 | 75,223,850 | |||||||||||||||
Common stock, outstanding (in shares) | 76,925,394 | 74,287,915 | |||||||||||||||
Voting rights per share | vote | 1 | ||||||||||||||||
Common Stock | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Stock split conversion ratio | 5 | ||||||||||||||||
Common stock, outstanding (in shares) | 82,102,629 | 79,465,150 | 77,331,229 | 74,316,607 | |||||||||||||
Exercise of stock options (in shares) | 2,637,479 | 2,133,921 | |||||||||||||||
Cash proceeds | $ | $ 117,000 | $ 54,000 | |||||||||||||||
Series F Warrant | Consortium Purchase Agreement | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Warrant to purchase shares (in shares) | 177,720,706 | ||||||||||||||||
Number of warrants issued to the Consortium (in shares) | 3 | ||||||||||||||||
Series A | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Shares issued (in shares) | 69,340,760 | ||||||||||||||||
Convertible preferred stock, price per share (in dollars per share) | $ / shares | $ 0.29 | ||||||||||||||||
Proceeds from issuance of convertible preferred stock | $ | $ 19,800,000 | ||||||||||||||||
Stock issued during the period (in shares) | 2,130,035 | 782,540 | |||||||||||||||
Convertible preferred stock, authorized (in shares) | 68,558,220 | ||||||||||||||||
Conversion ratio of preferred stock into prosper common stock | 1 | ||||||||||||||||
Times the original issue | time | 3 | ||||||||||||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 0.29 | ||||||||||||||||
Series A | Convertible Preferred Stock Held by Consolidated VIE | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Repurchase of convertible preferred stock (in shares) | 34,670,420 | ||||||||||||||||
Series A-1 | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Shares issued (in shares) | 25,585,910 | ||||||||||||||||
Convertible preferred stock, price per share (in dollars per share) | $ / shares | $ 0.01 | ||||||||||||||||
Stock split conversion ratio | 1,000,000 | ||||||||||||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 2 | ||||||||||||||||
Stock issued during the period (in shares) | 2,245,600 | ||||||||||||||||
Convertible preferred stock, authorized (in shares) | 24,760,915 | ||||||||||||||||
Percentage of holders of preferred stock required to request for conversion, minimum (at least) | 14% | ||||||||||||||||
Conversion ratio of preferred stock into prosper common stock | 1,000,000 | ||||||||||||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 2 | ||||||||||||||||
Series B | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Shares issued (in shares) | 41,443,670 | ||||||||||||||||
Convertible preferred stock, price per share (in dollars per share) | $ / shares | $ 0.60 | ||||||||||||||||
Proceeds from issuance of convertible preferred stock | $ | $ 24,900,000 | ||||||||||||||||
Stock issued during the period (in shares) | 648,720 | 5,667,790 | |||||||||||||||
Convertible preferred stock, authorized (in shares) | 35,775,880 | ||||||||||||||||
Value prior to closing of underwritten initial public offering (at least) | $ | $ 2,000,000,000 | ||||||||||||||||
Aggregate proceeds to the entity before deducting underwriters commissions and expenses (at least) | $ | $ 100,000,000 | ||||||||||||||||
Percentage of holders of preferred stock required to request for conversion, minimum (at least) | 60% | ||||||||||||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 0.60 | ||||||||||||||||
Series B | Convertible Preferred Stock Held by Consolidated VIE | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Repurchase of convertible preferred stock (in shares) | 16,577,495 | ||||||||||||||||
Series C | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Shares issued (in shares) | 24,404,770 | ||||||||||||||||
Convertible preferred stock, price per share (in dollars per share) | $ / shares | $ 2.87 | ||||||||||||||||
Proceeds from issuance of convertible preferred stock | $ | $ 69,900,000 | ||||||||||||||||
Convertible preferred stock, authorized (in shares) | 24,404,770 | ||||||||||||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 2.87 | ||||||||||||||||
Series A and Series B Convertible Preferred Stock | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Shares issued (in shares) | 6,963,785 | ||||||||||||||||
Convertible preferred stock, price per share (in dollars per share) | $ / shares | $ 2.87 | ||||||||||||||||
Repurchase of preferred stock | $ | $ 18,500,000 | ||||||||||||||||
Series D | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Shares issued (in shares) | 23,888,640 | ||||||||||||||||
Convertible preferred stock, price per share (in dollars per share) | $ / shares | $ 6.91 | ||||||||||||||||
Proceeds from issuance of convertible preferred stock | $ | $ 164,800,000 | ||||||||||||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 6.91 | ||||||||||||||||
Series E | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Convertible preferred stock, authorized (in shares) | 40,000,000 | ||||||||||||||||
Series E-1 | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Convertible preferred stock, authorized (in shares) | 35,544,141 | ||||||||||||||||
Warrant to purchase shares (in shares) | 15,277,006 | 20,267,135 | |||||||||||||||
Exercise of common stock warrants (in dollars per share) | $ / shares | $ 0.01 | ||||||||||||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 0.84 | ||||||||||||||||
Warrant expiration period | 10 years | ||||||||||||||||
Change in fair value | $ | $ (7,800,000) | 13,500,000 | |||||||||||||||
Series E-1 Warrants | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Warrant to purchase shares (in shares) | 15,277,006 | ||||||||||||||||
Series F Convertible Preferred Stock warrants | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Convertible preferred stock, authorized (in shares) | 177,720,707 | ||||||||||||||||
Warrant to purchase shares (in shares) | 177,720,706 | ||||||||||||||||
Exercise of common stock warrants (in dollars per share) | $ / shares | $ 0.01 | ||||||||||||||||
Percentage of holders of preferred stock required to request for conversion, minimum (at least) | 60% | ||||||||||||||||
Percent of liquidation preference | 66.60% | ||||||||||||||||
Liquidation rights after payment or payment set aside, percent of liquidation preference | 33.30% | ||||||||||||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 0.84 | ||||||||||||||||
Change in fair value | $ | $ (40,900,000) | $ 71,100,000 | |||||||||||||||
Class of warrant or right expiration period | 10 years | ||||||||||||||||
Series G | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Shares issued (in shares) | 37,249,497 | ||||||||||||||||
Convertible preferred stock, authorized (in shares) | 37,249,497 | ||||||||||||||||
Share price (in dollars per share) | $ / shares | $ 1.34 | ||||||||||||||||
Proceeds net issuance cost | $ | $ 47,900,000 | ||||||||||||||||
Percentage of holders of preferred stock required to request for conversion, minimum (at least) | 60% | ||||||||||||||||
Conversion ratio of preferred stock into prosper common stock | 1.36 | ||||||||||||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 1.34 | ||||||||||||||||
Common Stock | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Stock issued during the period (in shares) | 2,196,665 | ||||||||||||||||
Series D | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Convertible preferred stock, authorized (in shares) | 23,888,640 | ||||||||||||||||
Percentage of holders of preferred stock required to request for conversion, minimum (at least) | 60% | ||||||||||||||||
Series E-1 And Series E-2 Convertible Preferred Stock | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Percentage of holders of preferred stock required to request for conversion, minimum (at least) | 60% | ||||||||||||||||
Series E-2 | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Convertible preferred stock, authorized (in shares) | 16,858,078 | ||||||||||||||||
Percent of liquidation preference | 66.60% | ||||||||||||||||
Liquidation rights after payment or payment set aside, percent of liquidation preference | 33.30% | ||||||||||||||||
Liquidation preference per share (in dollars per share) | $ / shares | $ 0.84 | ||||||||||||||||
Series E and F Warrants | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Fair value adjustment of warrants | $ | $ 39,700,000 |
CONVERTIBLE PREFERRED STOCK, _4
CONVERTIBLE PREFERRED STOCK, CONVERTIBLE PREFERRED STOCK WARRANT LIABILITY AND COMMON STOCK - Summary of Shares Information (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Class of Stock [Line Items] | ||||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||
Convertible preferred stock, authorized (in shares) | 444,760,848 | 444,760,848 | ||
Convertible preferred stock, issued (in shares) | 209,613,570 | 209,613,570 | ||
Convertible preferred stock, outstanding (in shares) | 209,613,570 | 209,613,570 | ||
Liquidation Preference, Outstanding Shares | $ 370,456 | $ 370,456 | ||
Convertible Preferred Stock Held by Consolidated VIE | ||||
Class of Stock [Line Items] | ||||
Convertible preferred stock, outstanding (in shares) | (51,247,915) | (51,247,915) | (51,247,915) | (51,247,915) |
Series A | ||||
Class of Stock [Line Items] | ||||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | |||
Convertible preferred stock, authorized (in shares) | 68,558,220 | |||
Convertible preferred stock, issued (in shares) | 66,428,185 | |||
Convertible preferred stock, outstanding (in shares) | 66,428,185 | |||
Liquidation Preference, Outstanding Shares | $ 19,160 | |||
Series A | Convertible Preferred Stock Held by Consolidated VIE | ||||
Class of Stock [Line Items] | ||||
Convertible preferred stock, issued (in shares) | 34,670,420 | |||
Convertible preferred stock, outstanding (in shares) | 34,670,420 | |||
Series A-1 | ||||
Class of Stock [Line Items] | ||||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | |||
Convertible preferred stock, authorized (in shares) | 24,760,915 | |||
Convertible preferred stock, issued (in shares) | 22,515,315 | |||
Convertible preferred stock, outstanding (in shares) | 22,515,315 | |||
Liquidation Preference, Outstanding Shares | $ 45,031 | |||
Series B | ||||
Class of Stock [Line Items] | ||||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | |||
Convertible preferred stock, authorized (in shares) | 35,775,880 | |||
Convertible preferred stock, issued (in shares) | 35,127,160 | |||
Convertible preferred stock, outstanding (in shares) | 35,127,160 | |||
Liquidation Preference, Outstanding Shares | $ 21,190 | |||
Series B | Convertible Preferred Stock Held by Consolidated VIE | ||||
Class of Stock [Line Items] | ||||
Convertible preferred stock, issued (in shares) | 16,577,495 | |||
Convertible preferred stock, outstanding (in shares) | 16,577,495 | |||
Series C | ||||
Class of Stock [Line Items] | ||||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | |||
Convertible preferred stock, authorized (in shares) | 24,404,770 | |||
Convertible preferred stock, issued (in shares) | 24,404,770 | |||
Convertible preferred stock, outstanding (in shares) | 24,404,770 | |||
Liquidation Preference, Outstanding Shares | $ 70,075 | |||
Series D | ||||
Class of Stock [Line Items] | ||||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | |||
Convertible preferred stock, authorized (in shares) | 23,888,640 | |||
Convertible preferred stock, issued (in shares) | 23,888,640 | |||
Convertible preferred stock, outstanding (in shares) | 23,888,640 | |||
Liquidation Preference, Outstanding Shares | $ 165,000 | |||
Series E-1 | ||||
Class of Stock [Line Items] | ||||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | |||
Convertible preferred stock, authorized (in shares) | 35,544,141 | |||
Convertible preferred stock, issued (in shares) | 0 | |||
Convertible preferred stock, outstanding (in shares) | 0 | |||
Liquidation Preference, Outstanding Shares | $ 0 | |||
Series E-2 | ||||
Class of Stock [Line Items] | ||||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | |||
Convertible preferred stock, authorized (in shares) | 16,858,078 | |||
Convertible preferred stock, issued (in shares) | 0 | |||
Convertible preferred stock, outstanding (in shares) | 0 | |||
Liquidation Preference, Outstanding Shares | $ 0 | |||
Series F | ||||
Class of Stock [Line Items] | ||||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | |||
Convertible preferred stock, authorized (in shares) | 177,720,707 | |||
Convertible preferred stock, issued (in shares) | 3 | |||
Convertible preferred stock, outstanding (in shares) | 3 | |||
Liquidation Preference, Outstanding Shares | $ 0 | |||
Series G | ||||
Class of Stock [Line Items] | ||||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | |||
Convertible preferred stock, authorized (in shares) | 37,249,497 | |||
Convertible preferred stock, issued (in shares) | 37,249,497 | |||
Convertible preferred stock, outstanding (in shares) | 37,249,497 | |||
Liquidation Preference, Outstanding Shares | $ 50,000 |
CONVERTIBLE PREFERRED STOCK, _5
CONVERTIBLE PREFERRED STOCK, CONVERTIBLE PREFERRED STOCK WARRANT LIABILITY AND COMMON STOCK - Valuation Techniques (Details) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Volatility | Series E-1 Convertible Preferred Stock | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assumptions | 0.660 | 0.720 |
Volatility | Series F Convertible Preferred Stock warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assumptions | 0.6600 | 0.720 |
Risk-free interest rate | Series E-1 Convertible Preferred Stock | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assumptions | 0.0410 | 0.0430 |
Risk-free interest rate | Series F Convertible Preferred Stock warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assumptions | 0.0410 | 0.0430 |
Expected term (in years) | Series E-1 Convertible Preferred Stock | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Expected term (in years) | 2 years 9 months | 2 years 9 months |
Expected term (in years) | Series F Convertible Preferred Stock warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Expected term (in years) | 2 years 9 months | 2 years 9 months |
Dividend yield | Series E-1 Convertible Preferred Stock | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assumptions | 0 | 0 |
Dividend yield | Series F Convertible Preferred Stock warrants | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value assumptions | 0 | 0 |
STOCK-BASED COMPENSATION - Addi
STOCK-BASED COMPENSATION - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Options exercisable, maximum period | 10 years | ||
Dividend yield | 0% | 0% | 0% |
Software and Software Development Costs | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Capitalized amount | $ 230,000 | $ 200,000 | $ 137,000 |
Stock options issued and outstanding | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unrecognized cost of unvested share-based compensation awards. | 0 | ||
Restricted Stock Unit (RSUs) | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unamortized expense related to unvested stock-based awards | $ 2,700,000 | ||
Vesting period remaining | 2 years 6 months | ||
Tranche three | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Vesting percent | 25% | ||
Vesting percent after initial period following commencement date | 2.083% | ||
Vesting period of the options | 1 year | ||
Tranche two | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Vesting percent | 50% | ||
Vesting percent after initial period following commencement date, option one | 2.083% | ||
Vesting percent after initial period following commencement date, option two | 2.778% | ||
Vesting period of the options | 2 years | ||
2005 Stock Plan and 2015 Stock Option Plan | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Number of options made available in pool, up to (in shares) | 92,084,513 | ||
Vesting period remaining | 5 years 8 months 12 days |
STOCK-BASED COMPENSATION - Summ
STOCK-BASED COMPENSATION - Summarized Stock Option Activity (Details) - 2005 Stock Plan and 2015 Stock Option Plan - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Options Issued and Outstanding | ||
Options Issued and Outstanding, Beginning Balance (in shares) | 77,727,763 | |
Options Issued and Outstanding, Options granted (in shares) | 11,086,530 | |
Options Issued and Outstanding, Options exercised - vested (in shares) | (2,637,479) | |
Options Issued and Outstanding, Options forfeited (in shares) | (4,024,418) | |
Options Issued and Outstanding, Option expirations (in shares) | (39,125) | |
Options Issued and Outstanding, Ending balance (in shares) | 82,113,271 | 77,727,763 |
Options Issued and Outstanding, Options vested and expected to vest (in shares) | 77,171,342 | |
Options Issued and Outstanding, Options vested and exercisable (in shares) | 60,741,572 | |
Weighted- Average Exercise Price | ||
Weighted-Average Exercise Price, Beginning balance (in dollars per share) | $ 0.13 | |
Weighted-Average Exercise Price, Options granted (in dollars per share) | 0.34 | |
Weighted-Average Exercise Price, Options exercised - vested (in dollars per share) | 0.04 | |
Weighted-Average Exercise Price, Options forfeited (in dollars per share) | 0.35 | |
Weighted-Average Exercise Price, Option expirations (in dollars per share) | 0.02 | |
Weighted-Average Exercise Price, Ending balance (in dollars per share) | 0.15 | $ 0.13 |
Weighted-Average Exercise Price, Options vested and expected to vest (in dollars per share) | 0.15 | |
Weighted-Average Exercise Price, Options vested and exercisable (in dollars per share) | $ 0.08 | |
Weighted-Average Contractual Term (in years) | ||
Weighted average contractual term | 5 years 8 months 12 days | 6 years 2 months 19 days |
Weighted average contractual term, Options vested and expected to vest | 5 years 8 months 12 days | |
Weighted Average Contractual Term, Options vested and exercisable | 4 years 7 months 24 days | |
Aggregate intrinsic value | ||
Options outstanding, aggregate intrinsic value | $ 22,107 | $ 19,450 |
Aggregate intrinsic value, Options vested and expected to vest | 21,659 | |
Aggregate intrinsic value, Options vested and exercisable | $ 20,168 |
STOCK-BASED COMPENSATION - Ad_2
STOCK-BASED COMPENSATION - Additional Information Regarding Common Stock Options (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-Based Payment Arrangement [Abstract] | |||
Weighted average grant fair value (in dollars per share) | $ 0.21 | $ 0.37 | $ 0.13 |
STOCK-BASED COMPENSATION - Fair
STOCK-BASED COMPENSATION - Fair Value of Stock Option Awards (Details) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Fair value of stock option awards [Abstract] | |||
Volatility of common stock | 66.63% | 67.19% | 64.22% |
Risk-free interest rate | 3.55% | 2.95% | 1.02% |
Expected life | 6 years | 6 years | 6 years |
Dividend yield | 0% | 0% | 0% |
STOCK-BASED COMPENSATION - Sche
STOCK-BASED COMPENSATION - Schedule of Number of PMI’s RSU Activity (Details) - Restricted Stock Unit (RSUs) | 12 Months Ended |
Dec. 31, 2023 $ / shares shares | |
Number of Shares | |
Unvested, beginning balance (in shares) | shares | 2,602,383 |
Forfeited (in shares) | shares | (27,750) |
Expired (in shares) | shares | 0 |
Unvested, ending balance (in shares) | shares | 2,574,633 |
Weighted-Average Grant Date Fair Value | |
Unvested, beginning balance (in dollars per share) | $ / shares | $ 1.04 |
Forfeited (in dollars per share) | $ / shares | 2.18 |
Expired (in dollars per share) | $ / shares | 0 |
Unvested, ending balance (in dollars per share) | $ / shares | $ 1.03 |
STOCK-BASED COMPENSATION - Allo
STOCK-BASED COMPENSATION - Allocated Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Total Stock-Based Compensation | $ 1,575 | $ 1,326 | $ 1,136 |
Origination and Servicing | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Total Stock-Based Compensation | 83 | 134 | 123 |
Sales and Marketing | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Total Stock-Based Compensation | 304 | 118 | 62 |
General and Administrative | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Total Stock-Based Compensation | $ 1,188 | $ 1,074 | $ 951 |
INCOME TAXES - Components of In
INCOME TAXES - Components of Income Tax (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Current: | |||
Federal | $ 0 | $ 0 | $ 0 |
State | 15 | 197 | 0 |
Foreign | 0 | 0 | 0 |
Total Current Income Tax Expense | 15 | 197 | 0 |
Deferred: | |||
Federal | 47 | 47 | 47 |
State | 16 | 51 | 24 |
Foreign | 0 | 0 | 0 |
Total Deferred Income Tax Expense | 63 | 98 | 71 |
Total Income Tax Expense | $ 78 | $ 295 | $ 71 |
INCOME TAXES - Effective Income
INCOME TAXES - Effective Income Tax Reconciliation (Details) | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2018 | |
Effective income tax rate reconciliation [Abstract] | ||||
Federal tax at statutory rate | 21% | 21% | 21% | 21% |
State tax at statutory rate (net of federal benefit) | 8% | 6% | 8% | |
Incentive stock options | (1.00%) | 1% | (5.00%) | |
Preferred Stock Warrants | (12.00%) | (36.00%) | (29.00%) | |
Change in valuation allowance | (18.00%) | 15% | 6% | |
Return-to-provision | (1.00%) | (2.00%) | 0% | |
State tax rate changes | 2% | (5.00%) | 0% | |
Other | 1% | 0% | (1.00%) | |
Income Tax Expense | 0% | 0% | 0% |
INCOME TAXES - Deferred Tax Ass
INCOME TAXES - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets and liabilities [Abstract] | ||
Net operating loss carry forwards | $ 103,119 | $ 85,330 |
Research and other credits | 3,589 | 3,438 |
Stock compensation | 3,816 | 4,025 |
Accrued liabilities | 4,520 | 5,159 |
Net servicing rights | 35 | 0 |
Lease liabilities | 4,181 | 4,798 |
Property and equipment | 2,029 | 1,214 |
Section 174 R&D capitalization | 9,919 | 11,204 |
Total deferred tax assets | 131,208 | 115,168 |
Net servicing rights | 0 | (2,040) |
Intangible assets | (2,468) | (2,129) |
Right-of-use assets | (3,137) | (4,147) |
Total deferred tax liabilities | (5,605) | (8,316) |
Total net deferred tax asset | 125,603 | 106,852 |
Less: Valuation allowance | (126,324) | (107,512) |
Net deferred tax liability | $ (721) | $ (660) |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Tax Credit Carryforward [Line Items] | |||
Deferred tax assets valuation, increase amount | $ 18,800,000 | ||
Valuation allowance | 126,324,000 | $ 107,512,000 | |
Unrecognized tax benefits that would affect effective tax rate | 0 | ||
Interest and penalties related to uncertain tax positions | 0 | ||
Income tax expense | $ 78,000 | $ 295,000 | $ 71,000 |
Effective tax rate | 0% | 0% | 0% |
Prosper Funding LLC | |||
Tax Credit Carryforward [Line Items] | |||
Income tax expense | $ 0 | $ 0 | |
Effective tax rate | 0% | ||
Federal | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | $ 362,600,000 | ||
Federal | Research and Development | |||
Tax Credit Carryforward [Line Items] | |||
Tax credit carryforwards | 2,800,000 | ||
State | |||
Tax Credit Carryforward [Line Items] | |||
Net operating loss carryforwards | $ 449,900,000 | ||
Tax period subject to examination | 4 years | ||
California | Research and Development | |||
Tax Credit Carryforward [Line Items] | |||
Tax credit carryforwards | $ 2,800,000 | ||
Internal Revenue Service (IRS) | |||
Tax Credit Carryforward [Line Items] | |||
Tax period subject to examination | 3 years |
INCOME TAXES - Unrecognized Tax
INCOME TAXES - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Unrecognized tax benefits [Roll Forward] | |||
Beginning balance | $ 1,291 | $ 112 | $ 112 |
Decrease related to current year tax position | 0 | 0 | |
Increase related to 2022 tax year position | 1,179 | ||
Ending balance | $ 1,291 | $ 1,291 | $ 112 |
LEASES - Additional Information
LEASES - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | May 31, 2022 | |
Lessee, Lease, Description [Line Items] | ||||
Renewal term | 5 years | |||
Operating lease expense | $ 4,300,000 | $ 4,700,000 | $ 4,500,000 | |
Sublease income | 400,000 | 700,000 | 300,000 | |
Impairment charge | 196,000 | 0 | $ 0 | |
Operating lease liabilities (Note 16) | $ 14,431,000 | $ 16,351,000 | ||
Operating lease liability, location | Other Liabilities | Other Liabilities | ||
CALIFORNIA | Building | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease, right-of-use asset | $ 9,900,000 | |||
Operating lease liabilities (Note 16) | $ 9,900,000 | |||
Minimum | ||||
Lessee, Lease, Description [Line Items] | ||||
Remaining lease term | 3 years | |||
Maximum | ||||
Lessee, Lease, Description [Line Items] | ||||
Remaining lease term | 5 years |
LEASES - Operating Lease Right-
LEASES - Operating Lease Right-of-Use Assets (Details) - ROU assets - office buildings $ in Thousands | Dec. 31, 2023 USD ($) |
Lessee, Lease, Description [Line Items] | |
Gross Carrying Value | $ 22,655 |
Accumulated Amortization | 11,825 |
Net Carrying Value | $ 10,830 |
LEASES - Schedule of Lease Matu
LEASES - Schedule of Lease Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
2024 | $ 4,497 | |
2025 | 4,517 | |
2026 | 4,432 | |
2027 | 3,311 | |
2028 | 1,411 | |
Thereafter | 0 | |
Total future minimum lease payments | 18,168 | |
Less: Imputed interest | (3,737) | |
Present value of future minimum lease payments | $ 14,431 | $ 16,351 |
LEASES - Supplemental Cash Flow
LEASES - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Non-cash operating activity: | |||
ROU assets obtained or adjusted in exchange for new, amended and modified operating lease liabilities | $ (697) | ||
ROU assets obtained or adjusted in exchange for new, amended and modified operating lease liabilities | $ 9,980 | $ 1,773 |
LEASES - Other Information Rela
LEASES - Other Information Related to Leases (Details) | Dec. 31, 2023 |
Leases [Abstract] | |
Weighted-average remaining lease term | 4 years 3 days |
Weighted-average discount rate | 11.27% |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | 12 Months Ended | |
Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | |
Entity Information [Line Items] | ||
Designated Amount for loans (less than), through February 2025 | $ 100,000 | |
Minimum fee, 2024 | 1,200,000 | |
Minimum fee, 2025 | 100,000 | |
Minimum net liquidity | $ 15,000,000 | |
Fee deposits, percentage | 0.05 | |
Fee deposits refunds | $ 1,600,000 | |
Purchase commitment of borrower loans | 17,700,000 | |
Maximum potential future payments | 3,100,000,000 | |
Accrued repurchase and indemnification obligation | 500,000 | $ 300,000 |
Repayments of other long-term debt | 300,000 | |
Additional indemnification amount | 800,000 | |
Prosper Funding LLC | ||
Entity Information [Line Items] | ||
Designated Amount for loans (less than), through February 2025 | 100,000 | |
Minimum fee, 2024 | 1,200,000 | |
Minimum fee, 2025 | 100,000 | |
Minimum net liquidity | $ 15,000,000 | |
Fee deposits, percentage | 0.05 | |
Fee deposits refunds | $ 1,600,000 | |
Purchase commitment of borrower loans | 17,700,000 | |
Maximum potential future payments | 3,500,000,000 | |
Accrued repurchase and indemnification obligation | $ 500,000 | $ 300,000 |
RELATED PARTIES - Additional In
RELATED PARTIES - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Minimum percentage of voting securities considered for related parties (more than) | 10% |
Minimum percentage of stock holders considered for related parties | 10% |
RELATED PARTIES - Aggregate Amo
RELATED PARTIES - Aggregate Amount of Notes Purchased and the Income Earned (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Executive officers and management | ||
Related Party Transaction [Line Items] | ||
Aggregate Amount of Notes Purchased | $ 47 | $ 37 |
Interest Earned on Notes and Borrower Loans | 9 | 7 |
Payable to Related Party | 64 | 52 |
Executive officers and management | Prosper Funding LLC | ||
Related Party Transaction [Line Items] | ||
Aggregate Amount of Notes Purchased | 30 | 34 |
Interest Earned on Notes and Borrower Loans | 8 | 7 |
Payable to Related Party | 47 | 45 |
Directors (excluding executive officers and management) | ||
Related Party Transaction [Line Items] | ||
Aggregate Amount of Notes Purchased | 0 | 0 |
Interest Earned on Notes and Borrower Loans | 1 | 1 |
Payable to Related Party | 1 | 6 |
Directors (excluding executive officers and management) | Prosper Funding LLC | ||
Related Party Transaction [Line Items] | ||
Aggregate Amount of Notes Purchased | 0 | 0 |
Interest Earned on Notes and Borrower Loans | 0 | 0 |
Payable to Related Party | 0 | 0 |
Management | ||
Related Party Transaction [Line Items] | ||
Aggregate Amount of Notes Purchased | 47 | 37 |
Interest Earned on Notes and Borrower Loans | 10 | 8 |
Payable to Related Party | 65 | 58 |
Management | Prosper Funding LLC | ||
Related Party Transaction [Line Items] | ||
Aggregate Amount of Notes Purchased | 30 | 34 |
Interest Earned on Notes and Borrower Loans | 8 | 7 |
Payable to Related Party | $ 47 | $ 45 |
POSTRETIREMENT BENEFIT PLANS (D
POSTRETIREMENT BENEFIT PLANS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |||
Deferred compensation arrangement with eligible employees, percentage (up to) | 90% | ||
Employer contribution during the period | $ 3 | $ 2.7 | $ 2 |
SIGNIFICANT CONCENTRATIONS (Det
SIGNIFICANT CONCENTRATIONS (Details) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Concentration Risk [Line Items] | ||
Percentage of fund from whole loan channel | 89% | 92% |
Prosper Funding LLC | ||
Concentration Risk [Line Items] | ||
Percentage of fund from whole loan channel | 89% | 92% |
Party One | ||
Concentration Risk [Line Items] | ||
Percentage of loans purchased | 15.10% | 23.40% |
Party One | Prosper Funding LLC | ||
Concentration Risk [Line Items] | ||
Percentage of loans purchased | 23.40% | |
Party Two | ||
Concentration Risk [Line Items] | ||
Percentage of loans purchased | 12.50% | 10.40% |
Party Two | Prosper Funding LLC | ||
Concentration Risk [Line Items] | ||
Percentage of loans purchased | 10.40% | |
Party Three | ||
Concentration Risk [Line Items] | ||
Percentage of loans purchased | 11.90% | |
Party Four | ||
Concentration Risk [Line Items] | ||
Percentage of loans purchased | 10.70% | |
Warehouse VIE | Prosper Funding LLC | ||
Concentration Risk [Line Items] | ||
Percentage of loans purchased | 8.40% | 13.90% |
SEGMENTS - Additional Informati
SEGMENTS - Additional Information (Details) - segment | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2023 | |
Segment Reporting [Abstract] | ||
Number of reporting segments | 1 | 3 |
Number of operating segments | 1 | 3 |
SEGMENTS - Segment Information
SEGMENTS - Segment Information Reconciled (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | |||
Total Net Revenue | $ 137,700,000 | $ 199,881,000 | $ 144,626,000 |
Impact of interest rates on fair value of loans held in consolidated trusts | 2,629,000 | 7,248,000 | 3,084,000 |
Accelerated amortization of PWIIT debt issuance costs | (1,880,000) | ||
Segment Adjusted Net Revenue | 142,209,000 | 207,129,000 | 147,710,000 |
Segment Adjusted EBITDA | (30,628,000) | (1,808,000) | 15,898,000 |
Depreciation expense: | |||
Origination and Servicing | (8,774,000) | (8,132,000) | (7,167,000) |
General and Administrative | (2,108,000) | (2,656,000) | (2,501,000) |
Amortization of intangibles | (107,000) | (136,000) | (172,000) |
Stock-based compensation | (1,575,000) | (1,326,000) | (1,136,000) |
Impairment of operating lease right-of-use assets | (196,000) | 0 | 0 |
Change in Fair Value of Convertible Preferred Stock Warrants | (48,695,000) | 84,595,000 | (138,622,000) |
Gain on Forgiveness of PPP Loan | 0 | 8,604,000 | 0 |
Loss on Deconsolidation of VIEs | 0 | 0 | (1,494,000) |
Impact of interest rates on fair value of loans held in consolidated trusts | (2,629,000) | (7,248,000) | (3,084,000) |
Interest income on cash and cash equivalents | 2,473,000 | 511,000 | 8,000 |
Interest Expense on Term Loan | (12,265,000) | (1,527,000) | |
Net (Loss) Income Before Income Taxes | (106,384,000) | 70,877,000 | (138,270,000) |
Interest Income (Expense) Included in Segment Adjusted EBITDA | |||
Interest Income on Borrower Loans and Loans Held for Sale | 115,663,000 | 86,350,000 | 83,107,000 |
Interest Expense on Financial Instruments | (91,983,000) | (60,025,000) | (50,816,000) |
Total Interest Income, Net | 23,680,000 | 26,325,000 | 32,291,000 |
Personal Loan | |||
Segment Reporting Information [Line Items] | |||
Total Net Revenue | 100,921,000 | 180,717,000 | 143,670,000 |
Impact of interest rates on fair value of loans held in consolidated trusts | 2,629,000 | 7,248,000 | 3,084,000 |
Accelerated amortization of PWIIT debt issuance costs | (1,880,000) | ||
Segment Adjusted Net Revenue | 105,430,000 | 187,965,000 | 146,754,000 |
Segment Adjusted EBITDA | (32,027,000) | 9,301,000 | 22,303,000 |
Interest Income (Expense) Included in Segment Adjusted EBITDA | |||
Interest Income on Borrower Loans and Loans Held for Sale | 115,663,000 | 86,350,000 | 83,107,000 |
Interest Expense on Financial Instruments | (91,983,000) | (60,025,000) | (50,816,000) |
Total Interest Income, Net | 23,680,000 | 26,325,000 | 32,291,000 |
Home Equity | |||
Segment Reporting Information [Line Items] | |||
Total Net Revenue | 1,875,000 | 2,821,000 | 946,000 |
Impact of interest rates on fair value of loans held in consolidated trusts | 0 | 0 | 0 |
Accelerated amortization of PWIIT debt issuance costs | 0 | ||
Segment Adjusted Net Revenue | 1,875,000 | 2,821,000 | 946,000 |
Segment Adjusted EBITDA | (2,483,000) | (2,163,000) | (2,556,000) |
Interest Income (Expense) Included in Segment Adjusted EBITDA | |||
Interest Income on Borrower Loans and Loans Held for Sale | 0 | 0 | 0 |
Interest Expense on Financial Instruments | 0 | 0 | 0 |
Total Interest Income, Net | 0 | 0 | 0 |
Credit Card | |||
Segment Reporting Information [Line Items] | |||
Total Net Revenue | 34,904,000 | 16,343,000 | 10,000 |
Impact of interest rates on fair value of loans held in consolidated trusts | 0 | 0 | 0 |
Accelerated amortization of PWIIT debt issuance costs | 0 | ||
Segment Adjusted Net Revenue | 34,904,000 | 16,343,000 | 10,000 |
Segment Adjusted EBITDA | 3,882,000 | (8,946,000) | (3,849,000) |
Interest Income (Expense) Included in Segment Adjusted EBITDA | |||
Interest Income on Borrower Loans and Loans Held for Sale | 0 | 0 | 0 |
Interest Expense on Financial Instruments | 0 | 0 | 0 |
Total Interest Income, Net | $ 0 | $ 0 | $ 0 |