Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Aug. 06, 2018 | |
Document And Entity Information [Line Items] | ||
Entity Registrant Name | PROSPER MARKETPLACE, INC | |
Entity Central Index Key | 1,416,265 | |
Current Fiscal Year End Date | --12-31 | |
Current Fiscal Year End Date | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 70,381,991 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2018 | |
Prosper Funding LLC | ||
Document And Entity Information [Line Items] | ||
Entity Registrant Name | Prosper Funding LLC | |
Entity Central Index Key | 1,542,574 | |
Current Fiscal Year End Date | --12-31 | |
Current Fiscal Year End Date | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 0 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Assets | ||
Cash and Cash Equivalents | $ 58,652 | $ 45,795 |
Restricted Cash | 134,552 | 152,668 |
Available for Sale Investments, at Fair Value | 34,841 | 53,147 |
Accounts Receivable | 3,539 | 683 |
Loans Held for Sale, at Fair Value | 116,817 | 49 |
Borrower Loans, at Fair Value | 277,361 | 293,005 |
Property and Equipment, Net | 16,081 | 18,136 |
Prepaid and Other Assets | 7,776 | 7,796 |
Servicing Assets | 15,644 | 14,711 |
Goodwill | 36,368 | 36,368 |
Intangible Assets, Net | 1,177 | 1,377 |
Total Assets | 702,808 | 623,735 |
Liabilities, Convertible Preferred Stock and Stockholders' Deficit | ||
Accounts Payable and Accrued Liabilities | 14,652 | 11,942 |
Payable to Investors | 112,580 | 132,432 |
Notes at Fair Value | 277,425 | 293,948 |
Warehouse Line | 103,553 | 0 |
Other Liabilities | 13,718 | 12,669 |
Convertible Preferred Stock Warrant Liability | 143,676 | 116,366 |
Total Liabilities | 665,604 | 567,357 |
Commitments and Contingencies (see Note 17) | ||
Convertible Preferred Stock – $0.01 par value; 444,760,848 shares authorized; 214,637,925 issued and outstanding as of June 30, 2018; and 444,760,848 shares authorized; 214,637,925 issued and outstanding as of December 31, 2017. Aggregate liquidation preference of $375,952 as of June 30, 2018 and December 31, 2017. | 323,793 | 323,793 |
Stockholders' Deficit | ||
Common Stock – $0.01 par value; 625,000,000 shares authorized; 71,317,926 shares issued, and 70,381,991 shares outstanding, as of June 30, 2018; 625,000,000 shares authorized; 71,226,934 shares issued, and 70,290,999 shares outstanding, as of December 31, 2017. | 228 | 228 |
Additional Paid-In Capital | 141,463 | 136,653 |
Less: Treasury Stock | (23,417) | (23,417) |
Retained Earnings (Accumulated Deficit) | (404,801) | (380,806) |
Accumulated Other Comprehensive Loss | (62) | (73) |
Total Stockholders' Equity (Deficit) | (286,589) | (267,415) |
Total Liabilities, Convertible Preferred Stock and Stockholders' Deficit | 702,808 | 623,735 |
Prosper Funding LLC | ||
Assets | ||
Cash and Cash Equivalents | 10,892 | 8,223 |
Restricted Cash | 120,152 | 140,092 |
Loans Held for Sale, at Fair Value | 31 | 49 |
Borrower Loans, at Fair Value | 277,361 | 293,005 |
Property and Equipment, Net | 6,972 | 7,953 |
Servicing Assets | 16,162 | 14,598 |
Other Assets | 274 | 125 |
Total Assets | 431,844 | 464,045 |
Liabilities, Convertible Preferred Stock and Stockholders' Deficit | ||
Accounts Payable and Accrued Liabilities | 1,453 | 745 |
Payable to Related Party | 5,121 | 2,889 |
Payable to Investors | 112,444 | 132,112 |
Notes at Fair Value | 277,425 | 293,948 |
Other Liabilities | 4,926 | 3,985 |
Total Liabilities | 401,369 | 433,679 |
Stockholders' Deficit | ||
Member's Equity | 24,904 | 24,904 |
Retained Earnings (Accumulated Deficit) | 5,571 | 5,462 |
Total Stockholders' Equity (Deficit) | 30,475 | 30,366 |
Total Liabilities, Convertible Preferred Stock and Stockholders' Deficit | $ 431,844 | $ 464,045 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Sep. 20, 2017 |
Statement of Financial Position [Abstract] | |||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Convertible preferred stock, shares authorized (in shares) | 444,760,848 | 444,760,848 | 444,760,848 |
Convertible preferred stock, shares issued (in shares) | 214,637,925 | 214,637,925 | |
Convertible preferred stock, shares outstanding (in shares) | 214,637,925 | 214,637,925 | |
Convertible preferred stock, aggregate liquidation preference | $ 375,952 | $ 375,952 | |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 625,000,000 | 625,000,000 | 625,000,000 |
Common stock, shares issued (in shares) | 71,317,926 | 71,226,934 | |
Common stock, shares outstanding (in shares) | 70,381,991 | 70,290,999 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Operating Revenues | ||||
Transaction Fees, Net | $ 37,988,000 | $ 35,423,000 | $ 69,343,000 | $ 62,291,000 |
Servicing Fees, Net | 7,487,000 | 6,793,000 | 14,671,000 | 12,947,000 |
Gain (Loss) on Sale of Borrower Loans | 4,163,000 | 3,803,000 | 7,512,000 | 3,485,000 |
Fair Value of Warrants Vested on Sale of Borrower Loans | (20,633,000) | (16,887,000) | (35,912,000) | (20,194,000) |
Other Revenue | 1,015,000 | 1,415,000 | 2,367,000 | 2,135,000 |
Total Operating Revenues | 30,020,000 | 30,547,000 | 57,981,000 | 60,664,000 |
Interest Income | ||||
Interest Income on Borrower Loans | 14,556,000 | 12,007,000 | 26,916,000 | 23,507,000 |
Interest Expense on Notes and Warehouse Line | (11,471,000) | (11,177,000) | (22,200,000) | (21,855,000) |
Net Interest Income | 3,085,000 | 830,000 | 4,716,000 | 1,652,000 |
Change in Fair Value of Borrower Loans, Loans Held for Sale and Notes, Net | (1,430,000) | 70,000 | (572,000) | (24,000) |
Total Net Revenue | 31,675,000 | 31,447,000 | 62,125,000 | 62,292,000 |
Expenses | ||||
Origination and Servicing | 9,192,000 | 8,873,000 | 18,013,000 | 17,278,000 |
Sales and Marketing | 20,907,000 | 20,131,000 | 39,735,000 | 39,687,000 |
General and Administrative | 18,151,000 | 18,758,000 | 36,865,000 | 39,473,000 |
Restructuring Charges, Net | 271,000 | 647,000 | 595,000 | 572,000 |
Change in Fair Value of Convertible Preferred Stock Warrants | (3,998,000) | 22,416,000 | (8,602,000) | 22,817,000 |
Other Expenses (Income), Net | (258,000) | 1,930,000 | (500,000) | 7,629,000 |
Total Expenses | 44,265,000 | 72,755,000 | 86,106,000 | 127,456,000 |
Net Loss Before Taxes | (12,590,000) | (41,308,000) | (23,981,000) | (65,164,000) |
Income Tax Expense | 9,000 | 97,000 | 19,000 | 262,000 |
Net Income (Loss) | $ (12,599,000) | $ (41,405,000) | $ (24,000,000) | $ (65,426,000) |
Net Loss Per Share – Basic and Diluted (in dollars per share) | $ (0.18) | $ (0.59) | $ (0.34) | $ (0.94) |
Weighted-Average Shares - Basic and Diluted (in shares) | 70,362,716 | 69,691,841 | 70,333,145 | 69,436,365 |
Prosper Funding LLC | ||||
Operating Revenues | ||||
Administration Fee Revenue - Related Party | $ 30,836,000 | $ 27,309,000 | $ 54,620,000 | $ 42,463,000 |
Servicing Fees, Net | 7,209,000 | 6,520,000 | 14,022,000 | 12,401,000 |
Gain (Loss) on Sale of Borrower Loans | (16,181,000) | (13,084,000) | (27,754,000) | (16,709,000) |
Other Revenue | 73,000 | 34,000 | 136,000 | 64,000 |
Total Operating Revenues | 21,937,000 | 20,779,000 | 41,024,000 | 38,219,000 |
Interest Income | ||||
Interest Income on Borrower Loans | 10,907,000 | 12,007,000 | 21,859,000 | 23,507,000 |
Interest Expense on Notes and Warehouse Line | (10,177,000) | (11,177,000) | (20,388,000) | (21,855,000) |
Net Interest Income | 730,000 | 830,000 | 1,471,000 | 1,652,000 |
Change in Fair Value of Borrower Loans, Loans Held for Sale and Notes, Net | (255,000) | 70,000 | (364,000) | (24,000) |
Total Net Revenue | 22,412,000 | 21,679,000 | 42,131,000 | 39,847,000 |
Expenses | ||||
Administration Fee - Related Party | 20,285,000 | 18,466,000 | 38,175,000 | 34,282,000 |
Servicing | 1,663,000 | 1,524,000 | 3,478,000 | 3,255,000 |
General and Administrative | 182,000 | 145,000 | 365,000 | 318,000 |
Total Expenses | 22,130,000 | 20,135,000 | 42,018,000 | 37,855,000 |
Income Tax Expense | 0 | 0 | ||
Net Income (Loss) | $ 282,000 | $ 1,544,000 | $ 113,000 | $ 1,992,000 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Other Comprehensive Loss (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net Loss | $ (12,599) | $ (41,405) | $ (24,000) | $ (65,426) |
Other Comprehensive Income (Loss), Before Tax | ||||
Change in Net Unrealized Gain on Available for Sale Investments, at Fair Value | 27 | (1) | 12 | 16 |
Realized (Gain) Loss on Sale of Available for Sale Investments, at Fair Value | 0 | 0 | 0 | (12) |
Other Comprehensive Income, Before Tax | 27 | (1) | 12 | 4 |
Income tax effect | 0 | 0 | 0 | 0 |
Other Comprehensive Income, Net of Tax | 27 | (1) | 12 | 4 |
Comprehensive Loss | $ (12,572) | $ (41,406) | $ (23,988) | $ (65,422) |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cash flows from Operating Activities: | ||
Net Loss | $ (24,000) | $ (65,426) |
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities: | ||
Change in Fair Value of Borrower Loans, Loans Held for Sale and Notes | 572 | 24 |
Depreciation and Amortization | 5,334 | 6,270 |
Gain on Sales of Borrower Loans | (7,501) | (6,532) |
Change in Fair Value of Servicing Rights | 6,538 | 5,742 |
Stock-Based Compensation Expense | 4,584 | 6,812 |
Restructuring Liability | 595 | 412 |
Fair Value of Warrants Vested | 35,912 | 21,677 |
Change in Fair Value of Warrants | (8,602) | 22,817 |
Impairment Losses on Assets Held for Sale | 0 | 6,319 |
Other, Net | (358) | 199 |
Changes in Operating Assets and Liabilities: | ||
Purchase of Loans Held for Sale at Fair Value | (1,324,100) | (1,245,826) |
Proceeds from Sales and Principal Payments of Loans Held for Sale at Fair Value | 1,207,916 | 1,246,358 |
Accounts Receivable | (2,856) | 25 |
Prepaid and Other Assets | 1,448 | (4,637) |
Accounts Payable and Accrued Liabilities | 2,540 | (3,696) |
Payable to Investors | (19,852) | 17,967 |
Other Liabilities | (9) | (1,774) |
Net Cash (Used in) Provided by Operating Activities | (121,839) | 6,731 |
Cash Flows from Investing Activities: | ||
Purchase of Borrower Loans Held at Fair Value | (91,075) | (106,940) |
Principal Payments of Borrower Loans Held at Fair Value | 90,963 | 99,482 |
Purchases of Property and Equipment | (2,715) | (2,485) |
Maturities of Short Term Investments | 0 | 1,280 |
Purchases of Short Term Investments | 0 | (1,263) |
Purchases of Available for Sale Investments, at Fair Value | (5,448) | 0 |
Proceeds from Sale of Available for Sale Investments | 0 | 16,163 |
Maturities of Available for Sale Investments | 24,000 | 8,600 |
Net Cash Provided by Investing Activities | 15,725 | 14,837 |
Cash Flows from Financing Activities: | ||
Proceeds from Issuance of Notes Held at Fair Value | 90,693 | 106,506 |
Payments of Notes Held at Fair Value | (91,525) | (100,274) |
Proceeds from revolving debt facilities | 103,097 | 0 |
Payment for debt issuance costs | (1,428) | 0 |
Proceeds from Exercise of Warrants and Stock Options including Early Exercise, and Issuance of Restricted Stock | 18 | 18 |
Repurchase of Common Stock and Restricted Stock | 0 | (64) |
Net Cash Provided by Financing Activities | 100,855 | 6,186 |
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash | (5,259) | 27,754 |
Cash, Cash Equivalents and Restricted Cash at Beginning of the Period | 198,463 | 186,244 |
Cash, Cash Equivalents and Restricted Cash at End of the Period | 193,204 | 213,998 |
Supplemental Disclosure of Cash Flow Information: | ||
Cash Paid for Interest | 22,252 | 22,121 |
Non-Cash Investing Activity- Accrual for Property and Equipment, Net | 325 | 169 |
Prosper Funding LLC | ||
Cash flows from Operating Activities: | ||
Net Loss | 113 | 1,992 |
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities: | ||
Change in Fair Value of Borrower Loans, Loans Held for Sale and Notes | 364 | 24 |
Other Non-Cash Changes in Borrower Loans, Loans Held for Sale and Notes | (295) | (272) |
Depreciation and Amortization | 2,991 | 2,637 |
Gain on Sales of Borrower Loans | (8,147) | (6,532) |
Change in Fair Value of Servicing Rights | 6,552 | 5,609 |
Changes in Operating Assets and Liabilities: | ||
Purchase of Loans Held for Sale at Fair Value | (1,324,100) | (1,245,826) |
Proceeds from Sales and Principal Payments of Loans Held for Sale at Fair Value | 1,324,114 | 1,246,358 |
Other Assets | (153) | (71) |
Accounts Payable and Accrued Liabilities | 708 | (1,592) |
Payable to Investors | (19,668) | 18,374 |
Net Related Party Receivable/Payable | 2,116 | 3,807 |
Other Liabilities | 972 | 1,398 |
Net Cash (Used in) Provided by Operating Activities | (14,433) | 25,906 |
Cash Flows from Investing Activities: | ||
Purchase of Borrower Loans Held at Fair Value | (91,075) | (106,940) |
Principal Payments of Borrower Loans Held at Fair Value | 90,963 | 99,482 |
Purchases of Property and Equipment | (1,894) | (2,859) |
Maturities of Short Term Investments | 0 | 1,280 |
Purchases of Short Term Investments | 0 | (1) |
Net Cash Provided by Investing Activities | (2,006) | (9,038) |
Cash Flows from Financing Activities: | ||
Proceeds from Issuance of Notes Held at Fair Value | 90,693 | 106,506 |
Payments of Notes Held at Fair Value | (91,525) | (100,274) |
Net Cash Provided by Financing Activities | (832) | 6,232 |
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash | (17,271) | 23,100 |
Cash, Cash Equivalents and Restricted Cash at Beginning of the Period | 148,315 | 154,912 |
Cash, Cash Equivalents and Restricted Cash at End of the Period | 131,044 | 178,012 |
Supplemental Disclosure of Cash Flow Information: | ||
Cash Paid for Interest | 22,252 | 22,121 |
Non-Cash Investing Activity- Accrual for Property and Equipment, Net | $ (116) | $ 601 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Basis of Presentation | Basis of Presentation Prosper Marketplace, Inc. (“PMI”) was incorporated in the state of Delaware on March 22, 2005. Except as the context requires otherwise, as used in these notes to the condensed consolidated financial statements of PMI, “Prosper,” “we,” “us,” and “our” refer to PMI and its wholly-owned subsidiaries, on a consolidated basis. The unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“US GAAP”) and disclosure requirements for interim financial information and the requirements of Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2017 . The balance sheet at December 31, 2017 has been derived from the audited financial statements at that date. Management believes these unaudited interim condensed consolidated financial statements reflect all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the results for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the full year or any other interim period. The preparation of Prosper’s condensed consolidated financial statements and related disclosures in conformity with US GAAP requires management to make judgments, assumptions and estimates that affect the amounts reported in Prosper’s financial statements and accompanying notes. Management bases its estimates on historical experience and on various other factors it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of certain assets and liabilities. These judgments, estimates and assumptions are inherently subjective in nature and actual results may differ from these estimates and assumptions. The accompanying interim condensed consolidated financial statements include the accounts of PMI and its wholly-owned subsidiaries. All intercompany balances have been eliminated in consolidation. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Basis of Presentation | Basis of Presentation Prosper Funding LLC (“PFL”) was formed in the state of Delaware on February 17, 2012 as a limited liability company with the sole equity member being Prosper Marketplace, Inc. (“PMI”). Except as the context otherwise requires, as used in these Notes to the condensed consolidated financial statements of Prosper Funding LLC, “Prosper Funding,” “we,” “us,” and “our” refers to PFL and its wholly owned subsidiaries, Prosper Asset Holdings LLC (“PAH”), a Delaware limited liability company, and Prosper Depositor LLC, a Delaware limited liability company, on a consolidated basis. The unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“US GAAP”) and disclosure requirements for interim financial information and the requirements of Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2017 . The balance sheet at December 31, 2017 has been derived from the audited financial statements at that date. Management believes these unaudited interim condensed consolidated financial statements reflect all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the results for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the full year or any other interim period. Prosper Funding did no t have any items of other comprehensive income (loss) during any of the periods presented in the condensed consolidated financial statements as of and for the six months ended June 30, 2018 and June 30, 2017 . The preparation of Prosper Funding's condensed consolidated financial statements and related disclosures in conformity with US GAAP requires management to make judgments, assumptions and estimates that affect the amounts reported in its condensed consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other factors it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of certain assets and liabilities. These judgments, estimates and assumptions are inherently subjective in nature and actual results may differ from these estimates and assumptions, and the differences could be material. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Prosper’s significant accounting policies are included in Note 2 – Summary of Significant Accounting Policies in Prosper’s Annual Report on Form 10-K for the year ended December 31, 2017 . There have been no changes to these accounting policies during the first six months of 2018 other than the changes noted below. Fair Value Measurements Financial instruments consist principally of Cash and Cash Equivalents, Restricted Cash, Available for Sale Investments at Fair Value, Borrower Loans, Loans Held for Sale, Accounts Receivable, Accounts Payable and Accrued Liabilities, Payable to Investors, Convertible Preferred Stock Warrant Liability 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. Restricted Cash Restricted cash consists primarily of cash deposits 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 or Prosper has on our marketplace that has not yet been invested in Borrower Loans or disbursed to the investor. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amount shown in the condensed consolidated statements of cash flows: June 30, December 31, June 30, December 31, Cash and Cash Equivalents $ 58,652 45,795 $ 34,667 $ 22,337 Restricted Cash 134,552 152,668 179,331 163,907 Total Cash, Cash Equivalents and Restricted Cash shown in the consolidated statements of cash flows $ 193,204 $ 198,463 $ 213,998 $ 186,244 Borrower Loans, Loans Held for Sale and Notes 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 condensed consolidated balance sheets as assets and liabilities, respectively. We choose to measure certain financial instruments and certain other items at fair value on an instrument-by-instrument basis with unrealized gains and losses on items for which the fair value option has been elected reported in earnings. Management believes that the fair value option is more meaningful for the readers of the financial statements and it allows both the Borrower Loans and Notes to be valued using the same methodology. The fair value election, with respect to an item, may not be revoked once an election is made. Prosper estimates the fair value of such Borrower Loans and Notes using discounted cash flow methodologies that take into account expected prepayments, losses, recoveries and default rates. The Borrower Loans are not derecognized when a corresponding Note is issued as Prosper maintains the ability to sell the Borrower Loans without the approval of the holders of the corresponding Notes. Debt For debt instruments carried at amortized cost, the Company defers specific incremental costs directly related to issuing debt or entering into revolving debt arrangements. Debt issuance costs associated with revolving debt arrangements are presented as an asset and subsequently amortized over the term of the revolving debt arrangement. Revenues Revenue primarily results from fees and net interest income earned. Fees include transaction fees for our services performed on behalf of WebBank to originate a loan. We also have other smaller sources of revenue reported as other revenue, including referral fees and securitization fees. For more information about Prosper's revenues, see Note 2 of the Notes to the Consolidated Financial Statements in Part IV, Item 15 of our Annual Report on Form 10-K for the year ended December 31, 2017. 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, which is upon the successful origination of a Borrower Loan and which is similar to the recognition prior to the adoption of ASC 606. 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 5.00% of the original principal amount of such 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. Other Revenues Other Revenues consist primarily of securitization fees and credit referral fees. Credit referral fees are where partner companies pay us an agreed upon amount for successful referrals of customers from our marketplace. The transaction price is a fixed amount per referral and is recognized by the Company upon a successful referral which is similar to the recognition prior to the adoption of ASC 606. Securitization fees represent fees Prosper earns to facilitate securitizations for purchasers of Borrower Loans and is recognized as other revenue when the securitization is completed which is similar to the recognition prior to the adoption of ASC 606. In some instances Prosper may also provide a guarantee, which requires us to first determine the fair value of the guarantee and allocate the remaining transaction price to the securitization performance obligation. As of June 30, 2018 Prosper had no material contract assets, contract liabilities or deferred contract costs. As of June 30, 2018 , Prosper had no unsatisfied performance obligations related to transaction fee or other revenues. Recent Accounting Pronouncements Accounting Standards Adopted In The Current Period In May 2014, as part of its ongoing efforts to assist in the convergence of US GAAP and International Financial Reporting Standards (“IFRS”), the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, “ Revenue from Contracts with Customers. ” The new guidance sets forth a new five-step revenue recognition model which replaces the prior revenue recognition guidance in its entirety and is intended to eliminate numerous industry-specific pieces of revenue recognition guidance that have historically existed in U.S. GAAP. The underlying principle of the new standard is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects in exchange for the goods or services. The standard also requires more detailed disclosures and provides additional guidance for transactions that were not addressed completely in the prior accounting guidance. Prosper adopted the requirements of the ASU as of January 1, 2018, utilizing the modified retrospective approach. Transaction fees, securitization fees and credit referral fees are included in the scope of the new guidance, while servicing fees, net interest income and gain or loss on the sale of loans remain within the scope of ASC topic 860, Transfers and Servicing or ASC topic 310. The impact of adopting the ASU did not result in a material cumulative effect adjustment upon the date of adoption. Additionally, the impact of adoption on the Consolidated Financial Statements for the current period is insignificant. In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” The standard provides guidance for eight targeted changes with respect to how cash receipts and cash payments are classified in the statements of cash flows, with the objective of reducing diversity in practice. Prosper adopted the standard effective January 1, 2018. The adoption of this standard did not have a material impact on Prosper’s consolidated financial statements. In October 2016, the FASB issued ASU No. 2016-16, " Income Taxes (Topic 740): Intra-Entity Transfers Other than Inventory (ASU 2016-16)," which requires companies to recognize the income-tax consequences of an intra-entity transfer of an asset other than inventory. Prosper adopted the standard effective January 1, 2018, the adoption of this standard did not have a material impact on Prosper’s consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, " Statement of Cash Flows (Topic 230): Restricted Cash (ASU 2016-18)," which requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Prosper adopted the standard effective January 1, 2018. Prosper had $134.6 million and $179.3 million of restricted cash on its consolidated balance sheet as of June 30, 2018 and June 30, 2017 , respectively, whose cash flow statement classification changed to align with the new guidance. In January 2016, the FASB issued ASU 2016-01, "Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities," which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. Prosper adopted standard effective January 1, 2018. The adoption of this standard did not have a material impact on Prosper’s consolidated financial statements. Accounting Standards Issued, To Be Adopted By The Company In Future Periods In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , which requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. This guidance will be effective for us in the first quarter of our fiscal year 2019, and early adoption is permitted. Prosper is currently evaluating the impact that this guidance will have on its consolidated financial statements. We do expect that this guidance will have a material impact on Prosper's consolidated financial statements. As of June 30, 2018 Prosper had a total of $35.9 million in non-cancelable operating lease commitments. In January 2017, the FASB issued ASU No. 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. " The standard eliminates Step 2 from the goodwill impairment test, which requires a hypothetical purchase price allocation. Prosper will continue to have the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The standard is effective for interim and annual periods beginning after December 15, 2019 and early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The standard should be applied on a prospective basis. Prosper is currently evaluating the impact of this accounting standard update on its consolidated financial statements. In June 2018, the FASB issued ASU No. 2018-07 , "Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. " The ASU is intended to reduce the cost and complexity and to improve financial reporting for nonemployee share-based payments. The ASU expands the scope of Topic 718, Compensation-Stock Compensation , which currently only includes share-based payments to employees, to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. This ASU is effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year and early adoption is permitted, but no earlier than a company’s adoption date of Topic 606, Revenue from Contracts with Customers . Prosper is currently evaluating the impact of this accounting standard update on its consolidated financial statements. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Summary of Significant Accounting Policies | Significant Accounting Policies Prosper Funding's significant accounting policies are included in Note 2 – Summary of Significant Accounting Policies in Prosper Funding’s Annual Report on Form 10-K for the year ended December 31, 2017 . There have been no changes to these accounting policies during the first six months of 2018 . Fair Value Measurements Financial instruments consist principally of Cash and Cash Equivalents, Restricted Cash, Short Term Investments, Borrower Loans, Loans Held for Sale, 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. Restricted Cash Restricted cash consists primarily of cash deposits 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 or Prosper has on our marketplace that has not yet been invested in Borrower Loans or disbursed to the investor. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amount shown in the consolidated statements of cash flows: June 30, December 31, June 30, December 31, Cash and Cash Equivalents $ 10,892 8,223 $ 12,384 $ 6,929 Restricted Cash 120,152 140,092 165,628 147,983 Total Cash, Cash Equivalents and Restricted Cash show in the consolidated statements of cash flows $ 131,044 $ 148,315 $ 178,012 $ 154,912 Borrower Loans, Loans Held for Sale and Notes Through the Note Channel, Prosper Funding 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 Prosper Funding’s consolidated balance sheets as assets and liabilities, respectively. We choose to measure certain financial instruments and certain other items at fair value on an instrument-by-instrument basis with unrealized gains and losses on items for which the fair value option has been elected reported in earnings. Management believes that the fair value option is more meaningful for the readers of the financial statements and it allows both the Borrower Loans and Notes to be valued using the same methodology. The fair value election, with respect to an item, may not be revoked once an election is made. Prosper Funding estimates the fair value of such Borrower Loans and Notes using discounted cash flow methodologies that take into account expected prepayments, losses, recoveries and default rates. The Borrower Loans are not derecognized when a corresponding Note is issued as Prosper Funding maintains the ability to sell the Borrower Loans without the approval of the holders of the corresponding Notes. Recent Accounting Pronouncements Accounting Standards Adopted In The Current Period In May 2014, as part of its ongoing efforts to assist in the convergence of US GAAP and International Financial Reporting Standards (“IFRS”), the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers.” The new guidance sets forth a new five-step revenue recognition model which replaces the prior revenue recognition guidance in its entirety and is intended to eliminate numerous industry-specific pieces of revenue recognition guidance that have historically existed in US GAAP. The underlying principle of the new standard is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects in exchange for the goods or services. The standard also requires more detailed disclosures and provides additional guidance for transactions that were not addressed completely in the prior accounting guidance. Prosper Funding adopted the requirements of the ASU as of January 1, 2018, utilizing the modified retrospective approach. Administration fees are included in the scope of the new guidance, while servicing fees and gain or loss on the sale of loans remain within the scope of ASC topic 860, Transfers and Servicing. The impact of adopting the ASU is not significant to the Consolidated Financial Statements in the current period. In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” The standard provides guidance for eight targeted changes with respect to how cash receipts and cash payments are classified in the statements of cash flows, with the objective of reducing diversity in practice. Prosper Funding adopted standard effective January 1, 2018. The adoption of this standard did not have a material impact on Prosper Funding’s consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, "Statement of Cash Flows (Topic 230): Restricted Cash (ASU2016-18)," which requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Prosper Funding adopted standard effective January 1, 2018. Prosper Funding has $120.2 million and $165.6 million of restricted cash on its consolidated balance sheet as of June 30, 2018 and 2017 , respectively, whose cash flow statement classification changed to align with the new guidance. In January 2016, the FASB issued ASU 2016-01, "Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities," which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. Prosper Funding adopted standard effective January 1, 2018. The adoption of this standard did not have a material impact on Prosper Funding’s consolidated financial statements. |
Property and Equipment, Net
Property and Equipment, Net | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Property and Equipment, Net | Property and Equipment, Net Property and equipment consist of the following (in thousands): June 30, December 31, Property and equipment: Computer equipment $ 14,785 $ 14,499 Internal-use software and website development costs 21,372 19,910 Office equipment and furniture 3,010 3,010 Leasehold improvements 7,078 7,078 Assets not yet placed in service 1,893 1,216 Property and equipment 48,138 45,713 Less accumulated depreciation and amortization (32,057 ) (27,577 ) Total property and equipment, net $ 16,081 $ 18,136 Depreciation and amortization expense for property and equipment for the three months ended June 30, 2018 and June 30, 2017 was $2.4 million and $2.7 million , respectively. Depreciation and amortization expense for property and equipment for the six months ended June 30, 2018 and June 30, 2017 was $5.1 million and $5.2 million respectively. These charges are included in general and administration expenses on the condensed consolidated statements of operations. Prosper capitalized internal-use software and website development costs in the amount of $1.4 million and $1.0 million for the three months ended June 30, 2018 and June 30, 2017 , respectively. Prosper capitalized internal-use software and website development costs in the amount of $2.5 million and $2.1 million for the six months ended June 30, 2018 and June 30, 2017 , respectively. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Property and Equipment, Net | Property and Equipment Property and equipment consist of the following (in thousands): June 30, December 31, Property and equipment: Internal-use software and web site development costs $ 21,372 $ 19,911 Less accumulated depreciation and amortization (14,400 ) (11,958 ) Total property and equipment, net $ 6,972 $ 7,953 Depreciation expense for the three months ended June 30, 2018 and June 30, 2017 was $1.4 million and $1.4 million , respectively. Depreciation expense for the six months ended June 30, 2018 and June 30, 2017 was $3.0 million and $2.6 million , respectively. |
Borrower Loans, Loans Held for
Borrower Loans, Loans Held for Sale, and Notes Held at Fair Value | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Borrower Loans, Loans Held for Sale, and Notes Held at Fair Value | Borrower Loans, Loans Held for Sale, and Notes Held at Fair Value The aggregate principal balances outstanding and fair values of Borrower Loans, Loans Held for Sale, and Notes as of June 30, 2018 and December 31, 2017 , are presented in the following table (in thousands): Borrower Loans Notes Loans Held for Sale June 30, December 31, June 30, December 31, June 30, December 31, Aggregate principal balance outstanding $ 280,852 $ 296,668 $ (284,011 ) $ (300,922 ) $ 117,028 $ 59 Fair value adjustments (3,491 ) (3,663 ) 6,586 6,974 (211 ) (10 ) Fair value $ 277,361 $ 293,005 $ (277,425 ) $ (293,948 ) $ 116,817 $ 49 At June 30, 2018 , outstanding Borrower Loans had original terms to maturity of either 36 or 60 months , had monthly payments with fixed interest rates ranging from 5.31% to 32.32% , and had various maturity dates through June 2023 . At December 31, 2017 , outstanding Borrower Loans had original maturities of either 36 or 60 months , had monthly payments with fixed interest rates ranging from 5.31% to 32.32% , and had various maturity dates through December 2022 . Approximately $0.6 million and $1.2 million represents the loss that is attributable to changes in the instrument-specific credit risks related to Borrower Loans that were recorded in the change in fair value during the six months ending June 30, 2018 and June 30, 2017 , respectively. As of June 30, 2018 , Borrower Loans that were 90 days or more delinquent had an aggregate principal amount of $2.6 million and a fair value of $1.1 million . As of December 31, 2017 , Borrower Loans that were 90 days or more delinquent had an aggregate principal amount of $3.5 million and a fair value of $1.3 million . Prosper places loans on non-accrual status when they are over 120 days past due. As of June 30, 2018 and December 31, 2017 , Borrower Loans in non-accrual status had a fair value of $0.3 million and $0.3 million , respectively. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Borrower Loans, Loans Held for Sale, and Notes Held at Fair Value | Borrower Loans, Loans Held For Sale, and Notes Held at Fair Value The aggregate principal balances outstanding and fair values of Borrower Loans, Loans Held for Sale, and Notes as of June 30, 2018 and December 31, 2017 , are presented in the following table (in thousands): Borrower Loans Notes Loans Held for Sale June 30, 2018 December 31, 2017 June 30, 2018 December 31, 2017 June 30, 2018 December 31, 2017 Aggregate principal balance outstanding $ 280,852 $ 296,668 $ (284,011 ) $ (300,922 ) $ 44 $ 59 Fair value adjustments (3,491 ) (3,663 ) 6,586 6,974 (13 ) (10 ) Fair value $ 277,361 $ 293,005 $ (277,425 ) $ (293,948 ) $ 31 $ 49 At June 30, 2018 , outstanding Borrower Loans had original terms to maturity of either 36 or 60 months ; had monthly payments with fixed interest rates ranging from 5.31% to 32.32% and had various maturity dates through June 2023 . At December 31, 2017 , outstanding Borrower Loans had original maturities of either 36 or 60 months , monthly payments with fixed interest rates ranging from 5.31% to 32.32% , and had various maturity dates through December 2022 . Approximately $0.6 million represents the loss that is attributable to changes in the instrument specific credit risks related to Borrower Loans that was recorded in the change in fair value during the six months ended June 30, 2018 . As of June 30, 2018 , Borrower Loans that were 90 days or more delinquent had an aggregate principal amount of $2.6 million and a fair value of $1.1 million . As of December 31, 2017 , Borrower Loans that were 90 days or more delinquent had an aggregate principal amount of $3.5 million and a fair value of $1.3 million . Prosper Funding places loans on non-accrual status when they are over 120 days past due. As of June 30, 2018 and December 31, 2017 , Borrower Loans in non-accrual status had a fair value of $0.3 million and $0.3 million , respectively. |
Loan Servicing Assets and Liabi
Loan Servicing Assets and Liabilities | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Loan Servicing Assets and Liabilities | Loan Servicing Assets and Liabilities Prosper accounts for servicing assets and liabilities at their estimated fair values with changes in fair values recorded in servicing fees. 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 and liabilities are measured at fair value throughout the servicing period. The total gains and losses recognized on the sale of such Borrower Loans for the three months ended June 30, 2018 was a gain of $4.2 million and a loss of $20.6 million from the Fair Value of Warrants Vested on the Sale of Borrower Loans to the Consortium (as defined in Note 16). The total gains and losses recognized on the sale of such Borrower Loans for the six months ended June 30, 2018 was a gain of $7.5 million and a loss of $35.9 million from the Fair Value of Warrants Vested on the Sale of Borrower Loans to the Consortium. The total gains recognized on the sale of such Borrower Loans were $3.8 million during the three months ended June 30, 2017 , which included rebates provided to members of the Consortium prior to the closing of the Consortium transaction and a loss of $16.9 million from the Fair Value of Warrants Vested on the Sale of Borrower Loans to the Consortium after the closing of the Consortium transaction. The total gains recognized on the sale of such Borrower Loans were $3.5 million during the six months ended June 30, 2017 , which included rebates provided to members of the Consortium prior to the closing of the Consortium transaction and a loss of $20.2 million from the Fair Value of Warrants Vested on the Sale of Borrower Loans to the Consortium after the closing of the Consortium transaction. As of June 30, 2018 , Borrower Loans that were sold but for which Prosper retained servicing rights had a total outstanding principal balance of $3.9 billion , original terms of either 36 or 60 months , monthly payments with fixed interest rates ranging from 5.31% to 35.52% , and various maturity dates through June 2023 . At December 31, 2017 , Borrower Loans that were sold but for which Prosper retained servicing rights had a total outstanding principal balance of $3.7 billion , original terms of either 36 or 60 months, monthly payments with fixed interest rates ranging from 5.31% to 35.52% , and various maturity dates through December 2022 . $21.6 million and $18.2 million of contractually specified servicing fees and ancillary fees are included on our condensed consolidated statements of operations in Servicing Fees, Net for the six months ended June 30, 2018 and June 30, 2017 , 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 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 below are those that Prosper considers significant to the estimated fair values of the level 3 servicing assets and liabilities. 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. Prosper estimated 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 a backup service provider. 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 used a range of discount rates for the servicing assets and liabilities 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 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 we expect to collect fees on the Borrower Loans, which is used to project future servicing revenues. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Loan Servicing Assets and Liabilities | Loan Servicing Assets and Liabilities Prosper Funding accounts for servicing assets and liabilities at their estimated fair values with changes in fair values recorded in servicing fees. The initial asset or liability is recognized when Prosper Funding sells Borrower Loans to unrelated third-party buyers through the Whole Loan Channel and the servicing rights are retained. The total losses recognized on the sale of such Borrower Loans were a loss of $16.2 million and $13.1 million for the three months ended June 30, 2018 and June 30, 2017 , respectively. The total gains and losses recognized on the sale of such Borrower Loans were a loss of $27.8 million and $16.7 million for the six months ended June 30, 2018 and June 30, 2017 , respectively. As of June 30, 2018 , Borrower Loans that were sold, but for which Prosper Funding retained servicing rights, had a total outstanding principal balance of $3.9 billion , original terms of either 36 or 60 months, monthly payments with fixed interest rates ranging from 5.31% to 35.52% , and various maturity dates through June 2023 . At December 31, 2017 , Borrower Loans that were sold, but for which Prosper Funding retained servicing rights, had a total outstanding principal balance of $3.7 billion , original terms of either 36 or 60 months, monthly payments with fixed interest rates ranging from 5.31% to 35.52% , and various maturity dates through December 2022 . $11.2 million and $9.2 million of contractually specified servicing fees and ancillary fees are included on our condensed consolidated statements of operations in Servicing Fees, Net for the three months ended June 30, 2018 and June 30, 2017 , respectively. $21.8 million and $17.9 million of contractually specified servicing fees and ancillary fees are included on our condensed consolidated statements of operations in Servicing Fees, Net for the six months ended June 30, 2018 and June 30, 2017 , respectively. Fair Value Valuation Method . Prosper Funding 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 below are those that Prosper Funding considers significant to the estimated fair values of the level 3 servicing assets and liabilities. The following is a description of the significant unobservable inputs provided in the table. Market Servicing Rate . Prosper Funding 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. Prosper Funding estimated 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 Funding sells and services and information from a backup service provider. 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 used a range of discount rates for the servicing assets and liabilities 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 Funding’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 we expect to collect fees on the Borrower Loans, which is used to project future servicing revenues. |
Available for Sale Investments,
Available for Sale Investments, at Fair Value | 6 Months Ended |
Jun. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Available for Sale Investments, at Fair Value | Available for Sale Investments, at Fair Value Available for sale investments are recorded at fair value and unrealized gains and losses are reported, net of taxes, in accumulated other comprehensive income (loss) included in stockholders' equity unless management determines that an investment is other-than-temporarily impaired . The amortized cost, gross unrealized gains and losses, and fair value of available for sale investments as of June 30, 2018 and December 31, 2017 , are as follows (in thousands): June 30, 2018 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fixed maturity securities: Treasury Bills 20,668 — (23 ) 20,645 US Treasury securities 14,232 — (36 ) 14,196 Total Available for Sale Investments $ 34,900 $ — $ (59 ) $ 34,841 December 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fixed maturity securities: Treasury Bills $ 34,014 $ — $ (36 ) $ 33,978 US Treasury securities 19,207 — (38 ) 19,169 Total Available for Sale Investments $ 53,221 $ — $ (74 ) $ 53,147 A summary of available for sale investments with unrealized losses as of June 30, 2018 , and December 31, 2017 , aggregated by category and period of continuous unrealized loss, is as follows (in thousands): Less than 12 months 12 months or longer Total June 30, 2018 Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Fixed maturity securities: Treasury Bills $ 20,645 $ (23 ) $ — $ — $ 20,645 $ (23 ) US Treasury securities $ 14,196 $ (36 ) $ — $ — $ 14,196 $ (36 ) Total Investments with Unrealized Losses $ 34,841 $ (59 ) $ — $ — $ 34,841 $ (59 ) Less than 12 months 12 months or longer Total December 31, 2017 Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Fixed maturity securities: Treasury Bills $ 33,978 $ (36 ) $ — $ — $ 33,978 $ (36 ) US Treasury securities $ 19,169 $ (38 ) $ — $ — $ 19,169 $ (38 ) Total Investments with Unrealized Losses $ 53,147 $ (74 ) $ — $ — $ 53,147 $ (74 ) There were no impairment charges recognized during the six months ended June 30, 2018 . The maturities of available for sale investments at June 30, 2018 and December 31, 2017 are as follows (in thousands): June 30, 2018 Within 1 year After 1 year through 5 years After 5 years to 10 years After 10 years Total Treasury Bills 20,645 — — — 20,645 US Treasury securities 14,196 — — — 14,196 Total Fair Value $ 34,841 $ — $ — $ — $ 34,841 Total Amortized Cost $ 34,900 $ — $ — $ — $ 34,900 December 31, 2017 Within 1 year After 1 year through 5 years After 5 years to 10 years After 10 years Total Treasury Bills 33,978 — — — 33,978 US Treasury securities 14,947 4,222 — — 19,169 Total Fair Value $ 48,925 $ 4,222 $ — $ — $ 53,147 Total Amortized Cost $ 48,992 $ 4,229 $ — $ — $ 53,221 During the six months ended June 30, 2018 , Prosper sold $0 of investments which resulted in a realized gain of $0 . |
Fair Value of Assets and Liabil
Fair Value of Assets and Liabilities | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Fair Value of Assets and Liabilities | Fair Value of Assets and Liabilities Prosper measures the fair value of assets and liabilities in accordance with its fair value hierarchy which prioritizes information used to measure fair value and the effect of fair value measurements on earnings and provides for enhanced disclosures determined by the level within the hierarchy of information used in the valuation. We apply this framework whenever other standards require (or permit) assets or liabilities to be measured at fair value. Assets and liabilities carried at fair value on the balance sheets are classified among three levels based on the observability of the inputs used to determine fair value: Level 1 — The valuation is based on quoted prices in active markets for identical instruments. Level 2 — The valuation is based on observable inputs such as quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation methodologies for which all significant assumptions are observable in the market. Level 3 — The valuation is based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the instrument. Level 3 valuations are typically performed using pricing models, discounted cash flow methodologies, or similar methodologies, which incorporate management’s own estimates of assumptions that market participants would use in pricing the instrument or valuations that require significant management judgment or estimation. Fair values of assets or liabilities are determined based on the fair value hierarchy, which requires an entity to maximize the use of quoted prices and observable inputs and to minimize the use of unobservable inputs when measuring fair value. Various valuation methodologies are utilized, depending on the nature of the financial instrument, including the use of market prices for identical or similar instruments, or discounted cash flow models. When possible, active and observable market data for identical or similar financial instruments are utilized. Alternatively, fair value is determined using assumptions that management believes a market participant would use in pricing the asset or liability. Financial Instruments Recorded at Fair Value The fair value of the Borrower Loans, Loans Held for Sale, 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, Loans Held for Sale and Notes include default rates derived from historical performance and discount rates applied to each credit grade based on the perceived credit risk of each credit grade. Investments held at fair value consist of available for sale investments. The available for sale investments may consist of corporate debt securities, commercial paper, U.S. Treasury securities, Treasury bills, agency bonds and short term bond funds. When available, Prosper uses quoted prices in active markets to measure the fair value of securities available for sale. 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 investment assets. 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. Prosper compares the prices obtained from its primary independent pricing service to the prices obtained from the additional independent pricing services to determine if the price obtained from the primary independent pricing service is reasonable. Prosper 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 12 for further details. The following tables present the fair value hierarchy for assets and liabilities measured at fair value (in thousands): June 30, 2018 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans $ 277,361 $ 277,361 Loans Held for Sale 116,817 116,817 Available for Sale Investments, at Fair Value 34,841 — 34,841 Servicing Assets 15,644 15,644 Total Assets — 34,841 409,822 444,663 Liabilities: Notes $ 277,425 $ 277,425 Servicing Liabilities 28 28 Convertible Preferred Stock Warrant Liability 143,676 143,676 Loan Trailing Fee Liability 3,078 3,078 Total Liabilities $ — $ — $ 424,207 $ 424,207 December 31, 2017 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans $ — $ — $ 293,005 $ 293,005 Loans Held for Sale — — 49 49 Available for Sale Investments, at Fair Value — 53,147 — 53,147 Servicing Assets — — 14,711 14,711 Total Assets — 53,147 307,765 360,912 Liabilities: Notes $ — $ — $ 293,948 $ 293,948 Servicing Liabilities — — 59 59 Convertible Preferred Stock Warrant Liability — — 116,366 116,366 Loan Trailing Fee Liability — — 2,595 2,595 Total Liabilities $ — $ — $ 412,968 $ 412,968 As Prosper’s Borrower Loans, Loans Held for Sale, Notes, and loan servicing rights do not trade in an active market with readily observable prices, Prosper 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 Prosper’s level 3 fair value measurements at June 30, 2018 and December 31, 2017 : Borrower Loans, Loans Held for Sale and Notes: Range Unobservable Input June 30, 2018 December 31, 2017 Discount rate 4.4% - 13.9% 4.0% - 14.4% Default rate 2.0% - 15.6% 2.0% - 15.4% Servicing Rights Range Unobservable Input June 30, 2018 December 31, 2017 Discount rate 15% - 25% 15% - 25% Default rate 1.6% - 16.5% 1.5% - 16.1% Prepayment rate 15.2% - 32.9% 13.5% - 30.2% Market servicing rate 0.625 % 0.625 % Loan Trailing Fee Liability: Range Unobservable Input June 30, 2018 December 31, 2017 Discount rate 15% - 25% 15% - 25% Default rate 1.6% - 16.5% 1.5% - 16.1% Prepayment rate 15.2% - 32.9% 13.5% - 30.2% At June 30, 2018 , the discounted cash flow methodology used to estimate the Note fair values used the same projected cash flows as the related Borrower Loans. As demonstrated in the following table, 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. The following tables present additional information about level 3 Borrower Loans, Loans Held for Sale and Notes measured at fair value on a recurring basis (in thousands): Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at January 1, 2018 $ 293,005 $ (293,948 ) $ 49 $ (894 ) Purchase of Borrower Loans/Issuance of Notes 91,075 (90,693 ) 1,324,100 1,324,482 Principal repayments (88,947 ) 91,525 (14,265 ) (11,687 ) Borrower Loans sold to third parties (2,016 ) — (1,193,651 ) (1,195,667 ) Other changes (338 ) 633 796 1,091 Change in fair value (15,418 ) 15,058 (212 ) (572 ) Balance at June 30, 2018 $ 277,361 $ (277,425 ) $ 116,817 $ 116,753 Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at January 1, 2017 $ 315,627 $ (316,236 ) $ 624 $ 15 Purchase of Borrower Loans/Issuance of Notes 106,940 (106,506 ) 1,245,826 1,246,260 Principal repayments (97,492 ) 100,274 (42 ) 2,740 Borrower Loans sold to third parties (1,990 ) — (1,246,316 ) (1,248,306 ) Other changes 9 266 (3 ) 272 Change in fair value (10,822 ) 10,792 6 (24 ) Balance at June 30, 2017 $ 312,272 $ (311,410 ) $ 95 $ 957 Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at April 1, 2018 $ 285,584 $ (285,095 ) $ 82,803 $ 83,292 Purchase of Borrower Loans/Issuance of Notes 44,799 (44,468 ) 728,901 729,232 Principal repayments (43,990 ) 44,423 (10,416 ) (9,983 ) Borrower Loans sold to third parties (950 ) — (683,547 ) (684,497 ) Other changes (202 ) 86 255 139 Change in fair value (7,880 ) 7,629 (1,179 ) (1,430 ) Balance at June 30, 2018 $ 277,361 $ (277,425 ) $ 116,817 $ 116,753 Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at April 1, 2017 $ 317,536 $ (316,944 ) $ 109 $ 701 Purchase of Borrower Loans/Issuance of Notes 50,260 (49,692 ) 721,829 722,397 Principal repayments (48,048 ) 48,695 (14 ) 633 Borrower Loans sold to third parties (869 ) — (721,829 ) (722,698 ) Other changes 10 (156 ) — (146 ) Change in fair value (6,617 ) 6,687 — 70 Balance at June 30, 2017 $ 312,272 $ (311,410 ) $ 95 $ 957 The following tables present additional information about level 3 servicing assets and liabilities measured at fair value on a recurring basis (in thousands): Servicing Assets Servicing Liabilities Fair Value at January 1, 2018 14,711 59 Additions 7,502 — Less: Changes in fair value (6,569 ) (31 ) Fair Value at June 30, 2018 15,644 28 Servicing Assets Servicing Liabilities Fair Value at January 1, 2017 12,786 198 Additions 6,532 — Less: Changes in fair value (5,829 ) (87 ) Fair Value at June 30, 2017 13,489 111 Servicing Assets Servicing Liabilities Fair Value at April 1, 2018 14,754 41 Additions 4,163 — Less: Changes in fair value (3,273 ) (13 ) Fair Value at June 30, 2018 15,644 28 Servicing Assets Servicing Liabilities Fair Value at April 1, 2017 12,436 147 Additions 3,768 — Less: Changes in fair value (2,715 ) (36 ) Fair Value at June 30, 2017 13,489 111 The following table presents additional information about level 3 Preferred Stock Warrant Liability measured at fair value on a recurring basis (in thousands): Balance as of January 1, 2018 $ 116,366 Add Issuances of Preferred Stock Warrant 35,912 Change in fair value of the preferred stock warrant liability (8,602 ) Balance at June 30, 2018 $ 143,676 Balance as of January 1, 2017 $ — Add Issuances of Preferred Stock Warrant 47,297 Change in fair value of the preferred stock warrant liability 22,817 Balance at June 30, 2017 $ 70,114 Balance as of April 1, 2018 $ 127,041 Add Issuances of Preferred Stock Warrant 20,633 Change in fair value of the preferred stock warrant liability (3,998 ) Balance at June 30, 2018 $ 143,676 Balance as of April 1, 2017 $ 30,811 Add Issuances of Preferred Stock Warrant 16,887 Change in fair value of the preferred stock warrant liability 22,416 Balance at June 30, 2017 $ 70,114 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 defaults rates using a discounted cash flow model. The following table presents additional information about level 3 Loan Trailing Fee Liability measured at fair value on a recurring basis (in thousands): Balance at January 1, 2018 2,595 Issuances 1,529 Cash payment of Loan Trailing Fee (1,206 ) Change in fair value 160 Balance as of June 30, 2018 3,078 Significant Recurring Level 3 Fair Value Asset and Liability Input Sensitivity Key economic assumptions and the sensitivity of the current fair value to immediate changes in those assumptions at June 30, 2018 for Borrower Loans, Loans Held for Sale and Notes funded through the Note Channel are presented in the following table (in thousands, except percentages): Borrower Loans and Loans Held for Sale Notes Fair Value as of June 30, 2018 $394,178 $277,425 Discount rate assumption: 7.52 % * 7.52 % * Resulting fair value from: 100 basis point increase $ 390,255 $ 274,660 200 basis point increase 386,431 271,964 Resulting fair value from: 100 basis point decrease $ 398,202 $ 280,262 200 basis point decrease 402,333 283,173 Default rate assumption: 13.11 % * 13.11 % * Resulting fair value from: 100 basis point increase $ 389,288 $ 273,967 200 basis point increase 384,542 270,612 Resulting fair value from: 100 basis point decrease $ 399,107 $ 280,911 200 basis point decrease 404,079 284,428 * Represents weighted average assumptions considering all credit grades. The following table presents the estimated impact on Prosper’s estimated fair value of servicing assets and liabilities, calculated using different market servicing rates and different default rates as of June 30, 2018 (in thousands, except percentages). Servicing Assets Servicing Liabilities Fair Value as of June 30, 2018 $15,644 $28 Market servicing rate assumptions 0.625 % 0.625 % Resulting fair value from: Market servicing rate increase to 0.65% $ 14,691 $ 31 Market servicing rate decrease to 0.60% $ 16,634 $ 25 Weighted average prepayment assumptions 19.98 % 19.98 % Resulting fair value from: Applying a 1.1 multiplier to prepayment rate $ 15,471 $ 28 Applying a 0.9 multiplier to prepayment rate $ 15,857 $ 29 Weighted average default assumptions 12.66 % 12.66 % Resulting fair value from: Applying a 1.1 multiplier to default rate $ 15,473 $ 28 Applying a 0.9 multiplier to default rate $ 15,857 $ 28 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. Financial Instruments, Assets and Liabilities not Recorded at Fair Value The following tables present the fair value hierarchy for financial instruments, assets, and liabilities not recorded at fair value (in thousands): June 30, 2018 Carrying Amount Level 1 Inputs Level 2 Inputs Level 3 Inputs Balance at Fair Value Assets: Cash and Cash Equivalents $ 58,652 $ 58,652 $ — $ — $ 58,652 Restricted Cash 134,552 — 134,552 — 134,552 Accounts Receivable 3,539 — 3,539 — 3,539 Total Assets 196,743 58,652 138,091 — 196,743 Liabilities: Accounts Payable and Accrued Liabilities $ 14,652 $ — $ 14,652 $ — $ 14,652 Payable to Investors 112,580 — 112,580 — 112,580 Warehouse Line 103,553 — 103,553 — 103,553 Total Liabilities $ 230,785 $ — $ 230,785 $ — $ 230,785 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Fair Value of Assets and Liabilities | Fair Value of Assets and Liabilities Prosper Funding measures the fair value of assets and liabilities in accordance with its fair value hierarchy which prioritizes information used to measure fair value and the effect of fair value measurements on earnings and provides for enhanced disclosures determined by the level within the hierarchy of information used in the valuation. We apply this framework whenever other standards require (or permit) assets or liabilities to be measured at fair value. Assets and liabilities carried at fair value on the balance sheets are classified among three levels based on the observability of the inputs used to determine fair value: Level 1 — The valuation is based on quoted prices in active markets for identical instruments. Level 2 — The valuation is based on observable inputs such as quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation methodologies for which all significant assumptions are observable in the market. Level 3 — The valuation is based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the instrument. Level 3 valuations are typically performed using pricing models, discounted cash flow methodologies, or similar methodologies, which incorporate management’s own estimates of assumptions that market participants would use in pricing the instrument or valuations that require significant management judgment or estimation. Fair values of assets or liabilities are determined based on the fair value hierarchy, which requires an entity to maximize the use of quoted prices and observable inputs and to minimize the use of unobservable inputs when measuring fair value. Various valuation methodologies are utilized, depending on the nature of the financial instrument, including the use of market prices for identical or similar instruments, or discounted cash flow models. When possible, active and observable market data for identical or similar financial instruments are utilized. Alternatively, fair value is determined using assumptions that management believes a market participant would use in pricing the asset or liability. Financial Instruments Recorded at Fair Value The fair value of the Borrower Loans, Loans Held for Sale 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, Loans Held for Sale and Notes include default rates derived from historical performance and discount rates applied to each credit grade based on the perceived credit risk of each credit grade. The following tables present the fair value hierarchy for assets and liabilities measured at fair value (in thousands): June 30, 2018 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans $ — $ — $ 277,361 $ 277,361 Servicing Assets — — 16,162 16,162 Loans Held for Sale — — 31 31 Total Assets — — 293,554 293,554 Liabilities: Notes $ — $ — $ 277,425 $ 277,425 Servicing Liabilities — — 28 28 Loan Trailing Fee Liability — — 3,078 3,078 Total Liabilities $ — $ — $ 280,531 $ 280,531 December 31, 2017 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans $ — $ — $ 293,005 $ 293,005 Servicing Assets — — 14,598 14,598 Loans Held for Sale — — 49 49 Total Assets — — 307,652 307,652 Liabilities: Notes $ — $ — $ 293,948 $ 293,948 Servicing Liabilities — — 59 59 Loan Trailing Fee Liability — — 2,595 2,595 Total Liabilities $ — $ — $ 296,602 $ 296,602 As Prosper Funding’s Borrower Loans, Loans Held for Sale, Notes and loan servicing rights do not trade in an active market with readily observable prices, Prosper Funding 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 Prosper Funding’s level 3 fair value measurements at June 30, 2018 and December 31, 2017 : Borrower Loans, Loans Held for Sale and Notes: Range Unobservable Input June 30, 2018 December 31, 2017 Discount rate 4.4% - 13.9% 4.0% - 14.4% Default rate 2.0% - 15.6% 2.0% - 15.4% Servicing Assets and Liabilities: Range Unobservable Input June 30, 2018 December 31, 2017 Discount rate 15% - 25% 15% - 25% Default rate 1.6% - 16.5% 1.5% - 16.1% Prepayment rate 15.2% - 32.9% 13.5% - 30.2% Market servicing rate 0.625 % 0.625 % Loan Trailing Fee Liability: Range Unobservable Input June 30, 2018 December 31, 2017 Discount rate 15% - 25% 15% - 25% Default rate 1.6% - 16.5% 1.5% - 16.1% Prepayment rate 15.2% - 32.9% 13.5% - 30.2% The changes in the Borrower Loans, Loans Held for Sale and Notes, which are level 3 assets and liabilities measured at fair value on a recurring basis are as follows (in thousands): Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at January 1, 2018 $ 293,005 $ (293,948 ) $ 49 $ (894 ) Originations 91,075 (90,693 ) 1,324,100 1,324,482 Principal repayments (88,947 ) 91,525 (14 ) 2,564 Borrower Loans sold to third parties (2,016 ) — (1,324,100 ) (1,326,116 ) Other changes (338 ) 633 — 295 Change in fair value (15,418 ) 15,058 (4 ) (364 ) Balance at June 30, 2018 $ 277,361 $ (277,425 ) $ 31 $ (33 ) Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at January 1, 2017 $ 315,627 $ (316,236 ) $ 624 $ 15 Originations 106,940 (106,506 ) 1,245,826 1,246,260 Principal repayments (97,492 ) 100,274 (42 ) 2,740 Borrower Loans sold to third parties (1,990 ) — (1,246,316 ) (1,248,306 ) Other changes 9 266 (3 ) 272 Change in fair value (10,822 ) 10,792 6 (24 ) Balance at June 30, 2017 $ 312,272 $ (311,410 ) $ 95 $ 957 Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at April 1, 2018 $ 285,584 $ (285,095 ) $ 41 $ 530 Originations 44,799 (44,468 ) 728,901 729,232 Principal repayments (43,990 ) 44,423 (6 ) 427 Borrower Loans sold to third parties (950 ) — (728,901 ) (729,851 ) Other changes (202 ) 86 — (116 ) Change in fair value (7,880 ) 7,629 (4 ) (255 ) Balance at June 30, 2018 $ 277,361 $ (277,425 ) $ 31 $ (33 ) Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at April 1, 2017 $ 317,536 $ (316,944 ) $ 109 $ 701 Originations 50,260 (49,692 ) 721,829 722,397 Principal repayments (48,048 ) 48,695 (14 ) 633 Borrower Loans sold to third parties (869 ) — (721,829 ) (722,698 ) Other changes 10 (156 ) — (146 ) Change in fair value (6,617 ) 6,687 — 70 Balance at June 30, 2017 $ 312,272 $ (311,410 ) $ 95 $ 957 The following table presents additional information about level 3 servicing assets and liabilities recorded at fair value for the three months ended June 30, 2018 (in thousands). Servicing Assets Servicing Liabilities Fair Value at January 1, 2018 14,598 59 Additions 8,147 — Less: Changes in fair value (6,583 ) (31 ) Fair Value at June 30, 2018 16,162 28 Servicing Assets Servicing Liabilities Fair Value at January 1, 2017 12,461 198 Additions 6,532 — Less: Changes in fair value (5,696 ) (87 ) Fair Value at June 30, 2017 13,297 111 Servicing Assets Servicing Liabilities Fair Value at April 1, 2018 15,023 41 Additions 4,452 — Less: Changes in fair value (3,313 ) (13 ) Fair Value at June 30, 2018 16,162 28 Servicing Assets Servicing Liabilities Fair Value at April 1, 2017 12,190 147 Additions 3,768 — Less: Changes in fair value (2,661 ) (36 ) Fair Value at June 30, 2017 13,297 111 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 defaults rates using a discounted cash flow model. The following table presents additional information about level 3 Loan Trailing Fee Liability measured at fair value on a recurring basis (in thousands): Balance at January 1, 2018 2,595 Issuances 1,529 Cash payment of Loan Trailing Fee (1,206 ) Change in fair value 160 Balance as of June 30, 2018 3,078 Significant Recurring Level 3 Fair Value Asset and Liability Input Sensitivity Key economic assumptions and the sensitivity of the current fair value to immediate changes in those assumptions at June 30, 2018 for Borrower Loans, Loans Held for Sale and Notes funded are presented in the following table (in thousands, except percentages): Borrower Loans and Loans Held for Sale Notes Fair Value as of June 30, 2018 $ 277,392 $ 277,425 Discount rate assumption: 7.52 % * 7.52 % * Resulting fair value from: 100 basis point increase $ 274,662 $ 274,660 200 basis point increase 271,970 271,964 Resulting fair value from: 100 basis point decrease $ 280,255 $ 280,262 200 basis point decrease 283,162 283,173 Default rate assumption: 13.11 % * 13.11 % * Resulting fair value from: 100 basis point increase $ 273,981 $ 273,967 200 basis point increase 270,641 270,612 Resulting fair value from: 100 basis point decrease $ 280,892 $ 280,911 200 basis point decrease 284,391 284,428 * Represents weighted average assumptions considering all credit grades. Servicing Asset and Liability Fair Value Input Sensitivity: The following table presents the estimated impact on Prosper Funding’s estimated fair value of servicing assets and liabilities, calculated using different market servicing rates and different default rates as of June 30, 2018 (in thousands, except percentages). Servicing Assets Servicing Liabilities Fair Value as of June 30, 2018 $ 16,162 $ 28 Market servicing rate assumptions 0.625 % 0.625 % Resulting fair value from: Market servicing rate increase to 0.65% 15,160 31 Market servicing rate decrease to 0.60% 17,165 25 Weighted average prepayment assumptions 19.98 % 19.98 % Resulting fair value from: Applying a 1.1 multiplier to prepayment rate 15,964 28 Applying a 0.9 multiplier to prepayment rate 16,363 29 Weighted average default assumptions 12.66 % 12.66 % Resulting fair value from: Applying a 1.1 multiplier to default rate 15,967 28 Applying a 0.9 multiplier to default rate 16,362 28 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 | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill Prosper’s goodwill balance of $36.4 million at June 30, 2018 did not change during the six months ended June 30, 2018 . We did no t record any goodwill impairment expense for the six months ended June 30, 2018 . Other Intangible Assets The following table presents the detail of other intangible assets for the period presented (dollars in thousands): June 30, 2018 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 (3,873 ) $ 1,177 6.8 Brand name 60 (60 ) — — Total intangible assets subject to amortization $ 8,170 $ (6,993 ) $ 1,177 Prosper’s intangible asset balance was $1.2 million and $1.4 million at June 30, 2018 and December 31, 2017 , respectively. During the six months ended June 30, 2017 , certain intangible assets were made available for sale and as a result they were written down to fair value. This resulted in an impairment loss of $6.3 million , which is recorded in Other Expenses on the Condensed Consolidated Statement of Operations. The user base and customer relationship intangible assets are being amortized on an accelerated basis over a three to ten year period. The technology and brand name intangible assets are being amortized on a straight line basis over three to five years and one year , respectively. Amortization expense for the three months ended June 30, 2018 and June 30, 2017 was $0.1 million and $0.2 million , respectively. Amortization expense for the six months ended June 30, 2018 and June 30, 2017 was $0.2 million and $1.0 million , respectively. Estimated amortization of purchased intangible assets for future periods is as follows (in thousands): Year Ending December 31, Remainder of 2018 $ 178 2019 279 2020 220 2021 172 2022 136 Thereafter $ 192 Total $ 1,177 |
Other Liabilities
Other Liabilities | 6 Months Ended |
Jun. 30, 2018 | |
Other Liabilities [Abstract] | |
Other Liabilities | Other Liabilities Other Liabilities includes the following: June 30, 2018 December 31, 2017 Loan trailing fee 3,078 2,595 Deferred revenue 436 452 Servicing liabilities 28 59 Deferred income tax liability 244 225 Deferred rent 3,651 3,904 Restructuring liability 3,457 3,355 Other 2,824 2,079 Total Other Liabilities $ 13,718 $ 12,669 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt | Debt Warehouse Line On January 19, 2018, through a wholly-owned subsidiary, Prosper Warehouse I Trust ("PWIT"), Prosper entered into an agreement (the "Warehouse Agreement") for a committed revolving line of credit (the "Warehouse Line"). In connection with the Warehouse Agreement, PWIT 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 Line may only be used to purchase certain unsecured consumer loans and related rights and documents from the Company and to pay fees and expenses related to the Warehouse Line. 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 Warehouse line (including the final maturity date), amending the monthly unused commitment fee, and reducing the rate at which the Warehouse Line bears interest. Under the amended agreement, proceeds of loans made under the Warehouse Line may be borrowed, repaid, and reborrowed until the earlier of June 12, 2020 and the occurrence of any accelerated amortization event or event of default. Repayment of any outstanding proceeds will be made over the 24 month period ending June 12, 2022 , excluding the occurrence of any accelerated amortization event or event of default. Under the amended agreement, the Warehouse Line bears interest at a rate of LIBOR plus 3.00% and has an advance rate of 89% . Additionally, the Warehouse Line bears a monthly unused commitment fee, depending on utilization, of 0.50% or 0.75% per annum on the undrawn portion available under the Warehouse Line. The Warehouse Agreement contains certain covenants applicable to PWIT, including restrictions on PWIT’s ability to incur indebtedness, pledge assets, merge or consolidate, and enter into certain affiliate transactions. The Warehouse Line 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 June 30, 2018 , Prosper was in compliance with the covenants under the Warehouse Agreement. As of June 30, 2018 , Prosper had $103.6 million in debt outstanding and accrued interest under the Warehouse Line. This debt is secured by an aggregate outstanding principal balance of $116.2 million included in "Loans Held for Sale, at Fair Value" on the Condensed Consolidated Balance Sheet. At June 30, 2018 the undrawn portion available under the Warehouse Line was $96.9 million . Prosper incurred $1.6 million of capitalized debt issuance costs, which will be recognized as interest expense through June 12, 2022 . Prosper has also purchased swaptions to limit our exposure to increases in LIBOR. The swaptions are recorded on the Condensed 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 Loans, Loans Held for Sale and Notes, Net on the Condensed Consolidated Statement of Operations. The fair value of the swaptions was not material at June 30, 2018 . |
Net Loss Per Share
Net Loss Per Share | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss Per Share The weighted average shares used in calculating basic and diluted net loss per share excludes certain shares that are disclosed as outstanding shares in the condensed consolidated balance sheets because such shares are restricted as they were associated with options that were early exercised and continue to remain unvested. Basic and diluted net loss per share was calculated as follows: Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Numerator: Net loss available to common stockholders for basic and diluted EPS $ (12,599 ) $ (41,405 ) $ (24,000 ) $ (65,426 ) Denominator: Weighted average shares used in computing basic and diluted net loss per share 70,362,716 69,691,841 70,333,145 69,436,365 Basic and diluted net loss per share $ (0.18 ) $ (0.59 ) $ (0.34 ) $ (0.94 ) The following common stock equivalents were excluded from the computation of diluted net loss per share for the periods presented because including them would have been anti-dilutive: Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 (shares) (shares) (shares) (shares) Excluded securities: Convertible preferred stock issued and outstanding 214,637,925 177,388,428 214,637,925 177,388,428 Stock options issued and outstanding 75,206,928 60,938,265 66,403,696 53,040,604 Unvested stock options exercised 2,190 20,940 2,190 20,940 Restricted stock units — — — — Warrants issued and outstanding 1,080,349 1,199,403 1,082,917 1,199,403 Series E-1 convertible preferred stock warrants 35,544,141 35,544,141 35,544,141 35,544,141 Series F convertible preferred stock warrants 177,720,704 177,720,704 177,720,704 177,720,704 Total common stock equivalents excluded from diluted net loss per common share computation 504,192,237 452,811,881 495,391,573 444,914,220 |
Convertible Preferred Stock, Wa
Convertible Preferred Stock, Warrant Liability and Stockholders’ Deficit | 6 Months Ended |
Jun. 30, 2018 | |
Stockholders' Equity Note [Abstract] | |
Convertible Preferred Stock, Warrant Liability and Stockholders’ Deficit | Convertible Preferred Stock, Warrant Liability and Stockholders’ Deficit Convertible Preferred Stock and Warrants 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. On February 27, 2017, PMI issued to Pinecone Investments LLC a second warrant (the “Second Series E-1 Warrant,” and together with a previously issued 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 Capital Management, L.P. ("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 (as defined in Note 16) entered into with affiliates of the Consortium (as defined in Note 16, such affiliates, "Warrant Holders'") a warrant agreement was signed (the "Warrant Agreement"). Pursuant to the Warrant Agreement, PMI issued to the Consortium, three warrants (together, the “Series F Warrant”) to purchase up to an aggregate of 177,720,706 shares of PMI’s Series F convertible preferred stock at an exercise price of $0.01 per share (the “Warrant Shares”). The Warrant Holders' right to exercise the Series F Warrant is subject to monthly vesting during the term of the Consortium Purchase Agreement based upon the volume of loans the Consortium elects 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 Warrant Agreement, the 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 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. The number of authorized, issued and outstanding shares, their par value and liquidation preference for each series of convertible preferred stock as of June 30, 2018 are disclosed in the table below (amounts in thousands except share and per share amounts): Convertible Preferred Stock Par Value Authorized Shares Outstanding Liquidation Preference (Outstanding Shares) Series A $ 0.01 68,558,220 68,558,220 $ 19,774 Series A-1 0.01 24,760,915 24,760,915 49,522 Series B 0.01 35,775,880 35,775,880 21,581 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 50,000 444,760,848 214,637,925 $ 375,952 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 Series A, Series B, Series C, Series D, Series E-1, Series E-2, Series F, and Series G convertible preferred stock have been paid or set aside for payment to the Series A, Series B, Series C, Series D, Series E-1, Series E-2, Series F, and Series G convertible 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 the 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 (i) immediately prior to the closing of an Initial Public Offering (“IPO”) that values Prosper at least at $2 billion and that results in aggregate proceeds to Prosper of at least $100 million or (ii) 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. 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, Series F and the Series G convertible preferred stock converts into PMI common stock at a 1 :1 ratio while the Series A-1 convertible preferred stock converts into common stock at a 1,000,000 :1 ratio. The conversion price of the Series G convertible preferred stock shall be 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) were exercisable or exercised as of the Series G Preferred Stock closing date. Liquidation Rights PMI’s convertible preferred stock has been classified as temporary equity on the Consolidated Balance Sheets. 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 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 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 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, 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 (as defined in Note 16) on February 27, 2017. The warrants expire ten years from the date of issuance. For the three months ended June 30, 2018 , Prosper recognized $1.1 million of income from the re-measurement of the fair value of the warrants. For the six months ended June 30, 2018 , Prosper recognized $2.5 million of income from the re-measurement of the fair value of the warrants. The income is recorded through change in fair value of convertible preferred stock warrants in the condensed consolidated statement 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 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 option pricing method ("OPM") was used to allocate the BEV to the various classes of the Company’s equity, including the Company’s 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 convertible Series E-1 preferred stock warrants utilizing the following assumptions as of the following dates: June 30, 2018 December 31, 2017 Volatility 40% 40% Risk-free interest rate 2.83% 2.38% Remaining contractual term (in years) 8.55 9.04 Dividend yield 0% 0% 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 because the Company has limited information on the volatility of the 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 the period end date and for zero coupon U.S. Treasury notes with maturities approximately equal to the term of the warrant. Remaining Contractual Term . The remaining contractual term represents the time from the date of the valuation to the expiration of the warrant. 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 (as described in Note 16), PMI issued warrants to purchase up to 177,720,706 shares of PMI's Series F convertible preferred stock at $0.01 per share. For the three months ended June 30, 2018 , Prosper recognized $2.9 million of income from the re-measurement of the fair value of the warrants. For the six months ended June 30, 2018 , Prosper recognized $6.1 million of income from the re-measurement of the fair value of the warrants. The income is recorded through change in fair value of convertible preferred stock warrants in the condensed consolidated statement of operations. To determine the fair value of the Series F Convertible Preferred Stock 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 of the Company 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 the Company’s equity, including the Company’s 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 convertible Series F preferred stock warrants utilizing the following assumptions as of the following dates: June 30, 2018 December 31, 2017 Volatility 40% 40% Risk-free interest rate 2.83% 2.38% Remaining contractual term (in years) 8.66 9.16 Dividend yield 0% 0% 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 because the Company has limited information on the volatility of the 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 the period end date and for zero coupon U.S. Treasury notes with maturities approximately equal to the term of the warrant. Remaining Contractual Term . The remaining contractual term represents the time from the date of the valuation to the expiration of the warrant. Dividend Yield . The expected dividend assumption is based on the Company’s current expectations about the Company’s anticipated dividend policy. The combined activity of the Convertible Preferred Stock Warrant Liability for the six months ended June 30, 2018 is as follows (in thousands): Balance at January 1, 2018 $ 116,366 Warrants Vested 35,912 Change in Fair Value (8,602 ) Balance as of June 30, 2018 $ 143,676 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 of June 30, 2018 , 71,317,926 shares of common stock were issued and 70,381,991 shares of common stock were outstanding. As of December 31, 2017 , 71,226,934 shares of common stock were issued and 70,290,999 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 six months ended June 30, 2018 , PMI issued 82,792 shares of common stock upon the exercise of vested options for cash proceeds of $18 thousand . Certain options are eligible for exercise prior to vesting. These unvested options may be exercised for restricted shares of common stock that have the same vesting schedule as the options. Prosper records a liability for the exercise price paid upon the exercise of unvested options, which is reclassified to common stock and additional paid-in capital as the shares vest. Should the optionholder’s employment be terminated, the unvested restricted shares are subject to repurchase by PMI at an amount equal to the exercise price paid for such shares. At June 30, 2018 and December 31, 2017 , there were 2,190 and 11,565 shares, respectively, of restricted stock outstanding that remain unvested and subject to PMI’s right of repurchase. For the six months ended June 30, 2018 , PMI repurchased no shares of restricted stock upon termination of employment of employees. |
Share Based Incentive Plan and
Share Based Incentive Plan and Compensation | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share Based Incentive Plan and Compensation | Share Based Incentive Plan and 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 and Amendment No. 2 ,which were approved by PMI's stockholders on February 15, 2016 and May 31, 2016, 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 June 30, 2018 , up to 93,468,710 shares of common stock are reserved for issuance under the 2015 Plan, 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 (i) 25% 1 year from the vesting commencement date and 1/48t h per month thereafter, (ii) 50% one year from the vesting date and 1/48t h per month thereafter, (iii) 50% two years from the vesting commencement date and 1/48t h per month thereafter, or (iv) 1/36t h per month from the vesting commencement date. In no event are options exercisable more than 10 years after the date of grant. At June 30, 2018 , there were 22,824,771 shares available for grant under the 2015 Plan and zero shares available for grant under the 2005 Plan. Stock Option Reprice On May 3, 2016, the Compensation Committee of the Board of Directors of PMI approved a stock option repricing program (the “2016 Reprice”), authorizing PMI’s officers to reprice certain outstanding stock options held by employees and directors that have exercise prices above the current fair market value of PMI’s common stock. The repricing was effected on May 16, 2016 for eligible directors and employees located in the United States and on May 19, 2016 for eligible employees located in Israel. On March 17, 2017, the Compensation Committee of the Board of Directors of PMI approved a stock option repricing program (the “2017 Reprice” and together with the 2016 Reprice, the "Repricings"), authorizing PMI’s officers to reprice certain outstanding stock options held by employees and directors that have exercise prices above the current fair market value of PMI’s common stock. The repricing was effected on March 17, 2017 for eligible directors and employees. Prosper believes that the Repricings will encourage the continued service of valued employees and directors, and motivate such service providers to perform at high levels, both of which are critical to Prosper’s continued success. Prosper expects to incur additional stock based compensation charges as a result of the Repricings. The financial statement impact of the above Repricings is $0.2 million in the three months ended June 30, 2018 and $0.7 million (net of forfeitures) that will be recognized over the remaining weighted average vesting period of 1.1 years . Early Exercised Stock Options The balance of stock options that were early exercised under the 2005 Plan as of June 30, 2018 is not material. Stock Option Activity Stock option activity under the 2005 Plan and 2015 Plan is summarized for the six months ended June 30, 2018 below: Options Issued and Outstanding Weighted- Average Exercise Price Balance as of January 1, 2018 58,628,039 $ 0.25 Options issued 18,703,551 0.54 Options exercised – vested (82,792 ) 0.22 Options forfeited (3,879,249 ) 0.37 Balance as of June 30, 2018 73,369,549 $ 0.32 Options vested and expected to vest as of June 30, 2018 60,048,513 0.32 Options vested and exercisable at June 30, 2018 34,914,602 0.22 Other Information Regarding Stock Options Additional information regarding common stock options outstanding as of June 30, 2018 is as follows: Options Outstanding Options Vested and Exercisable Range of Exercise Prices Number Outstanding Weighted – Avg. Remaining Life Weighted –Avg. Exercise Price Number Vested Weighted – Avg. Exercise Price $ 0.02 - 0.20 4,768,290 5.55 $ 0.11 4,768,290 $ 0.11 0.21 - 0.50 45,281,131 8.25 0.23 28,602,923 0.22 0.51 - 1.13 23,320,128 9.60 0.54 1,543,389 0.54 $ 0.02 - 1.13 73,369,549 8.51 $ 0.32 34,914,602 $ 0.22 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 Prosper 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, Prosper 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 Prosper. 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. Prosper uses an expected dividend yield of zero as it does not anticipate paying any dividends in the foreseeable future. Prosper also estimates forfeitures of unvested stock options. Expected forfeitures are based on Prosper’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 three and six months ended June 30, 2018 and June 30, 2017 was estimated at the date of grant using the Black-Scholes model with the following average assumptions: Three Months Ended Six Months Ended June 30, 2018 2017 2018 2017 Volatility of common stock 44.43 % N/A 44.12 % 50.28 % Risk-free interest rate 2.85 % N/A 2.75 % 2.12 % Expected life (in years) 6.0 years N/A 6.0 years 5.7 years Dividend yield 0 % N/A 0 % 0 % Restricted Stock Unit Activity During the six months ended June 30, 2018 , PMI granted restricted stock units (“RSUs”) to certain employees that are subject to three -year vesting terms or four -year vesting terms and the occurrence of a liquidity event. The aggregate fair value of the RSUs granted was $1.9 million . The following table summarizes the activities for PMI’s RSUs during the six months ended June 30, 2018 : Number of Shares Weighted-Average Grant Date Fair Value Unvested - January 1, 2018 1,399,180 $ 2.16 Granted 3,569,586 0.54 Vested — — Forfeited (100,500 ) 2.17 Unvested - June 30, 2018 4,868,266 $ 0.96 The following table presents the amount of stock-based compensation related to stock-based awards granted to employees recognized in Prosper’s condensed consolidated statements of operations during the three and six months ended June 30, 2018 and June 30, 2017 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2018 2018 2017 2018 2017 Origination and servicing $ 241 $ 328 $ 456 $ 545 Sales and marketing 108 141 216 311 General and administrative 1,904 2,843 3,912 5,956 Total stock based compensation $ 2,253 $ 3,312 $ 4,584 $ 6,812 During the three months ended June 30, 2018 and June 30, 2017 , Prosper capitalized $0.1 million and $0.1 million , respectively, of stock-based compensation as internal use software and website development costs. As of June 30, 2018 , the unamortized stock-based compensation expense adjusted for forfeiture estimates related to Prosper’s employees’ unvested stock-based awards was approximately $10.4 million , which will be recognized over the remaining weighted-average vesting period of approximately 2 years. |
Restructuring
Restructuring | 6 Months Ended |
Jun. 30, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring Summary of Restructuring Plan During 2016, Prosper adopted a strategic restructuring of its business. This restructuring was intended to streamline our operations and support future growth efforts. Under this restructuring, Prosper closed its Salt Lake City, Utah location and its Tel Aviv, Israel location. In the six months ended June 30, 2018 Prosper's only restructuring activities related to office space that is no longer needed. Other than accretion and changes in sublease loss estimates, Prosper does not expect any additional restructuring charges related to this restructuring. The following table summarizes the activities related to Prosper's restructuring plan (in thousands): Facilities Related Total Balance January 1, 2018 $ 3,244 $ 3,244 Adjustments to expense 591 591 Sublease cash receipts 316 316 Less: Cash paid (775 ) (775 ) Balance June 30, 2018 $ 3,376 $ 3,376 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Income Taxes | Income Taxes For the three months ended June 30, 2018 and June 30, 2017 , Prosper recognized $9 thousand and $97 thousand of income tax expense, respectively. For the six months ended June 30, 2018 and June 30, 2017 , Prosper recognized $19 thousand and $262 thousand of income tax expense, respectively. The income tax expense relates to state income tax expense and the amortization of tax deductible goodwill which gives rise to an indefinite-lived deferred tax liability. No other income tax expense or benefit was recorded for the three or six month periods ended June 30, 2018 and June 30, 2017 due to a full valuation allowance recorded against our deferred tax assets. Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to utilize our existing deferred tax assets. On the basis of this evaluation, it is not more likely than not that our deferred tax assets will be realized and therefore a full valuation allowance has been recorded. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Income Taxes | Income Taxes Prosper Funding incurred no income tax provision for the six months ended June 30, 2018 and June 30, 2017 . Prosper Funding is a US disregarded entity and its income and loss is included in the return of its parent, PMI. Since PMI is in a loss position, is not currently subject to income taxes, and has fully reserved its deferred tax asset, the net effective tax rate for Prosper Funding is 0% . |
Consortium Purchase Agreement
Consortium Purchase Agreement | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Consortium Purchase Agreement | Consortium Purchase Agreement On February 27, 2017, Prosper entered into a series of agreements (the "Consortium Purchase Agreement") with a consortium of investors (the "Consortium"), pursuant to which the Consortium has agreed to purchase borrower loans in an aggregate principal amount of up to $5.0 billion (including certain loans purchased by one of the investors prior to the date of the Consortium Purchase Agreement). PFL will be obligated to offer for purchase minimum monthly volumes of eligible loans to the Consortium, for the Consortium to elect to purchase. In connection with the Consortium Purchase Agreement, PMI issued to the Consortium, three warrants to purchase up to an aggregate 177,720,706 shares of PMI’s Series F Preferred Stock at an exercise price of $0.01 per share (the “Warrant Shares”). The Consortium’s right to exercise the Series F Warrant is subject to monthly vesting during the term of the Consortium Purchase Agreement based upon the volume of loans the Consortium elects to purchase (if any) in each month, subject to certain cure rights such as offering additional loans for sale in subsequent periods. Pursuant to these cure rights, if the Consortium fails to respond to offers for allocation, purchase or funding, the Consortium can take advantage of a designated period of time to cure such failure. There have been no such failures by the Consortium to date. Under the terms of the Warrant Agreement, the 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 other events set forth in the Warrant Agreement. On vesting of the Series F warrants, Prosper records a liability as "Convertible Preferred Stock Warrant Liability" on the Condensed Consolidated Balance Sheet at fair value and a corresponding amount as "Fair Value of Warrants Vested on Sale of Borrower Loans" on the Condensed Consolidated Statement of Operations. Subsequent changes in the fair value of the vested warrants are recorded in "Change in Fair Value of Convertible Preferred Stock Warrants" on the Condensed Consolidated Statement of Operations. Additionally, in connection with the execution of the Consortium Purchase Agreement, certain previously issued rebates were settled by an issuance of vested Series F Convertible Preferred Stock Warrants. The difference in fair value of these warrants over the cash settlement price is recorded in "Change in Fair Value of Convertible Preferred Stock Warrants" on the Condensed Consolidated Statement of Operations. The following represents the loans purchased and warrants vested under the Consortium Purchase Agreement: Loans Acquired (in thousands) Warrants Vested Total as of December 31, 2017 $ 1,826,527 75,186,002 Loans Purchased by the Consortium during the six months ended June 30, 2018 831,097 36,830,278 Total as of June 30, 2018 $ 2,657,624 112,016,280 In addition to the $2.7 billion above, warrants vested on signing of the Consortium Purchase Agreement were issued to settle certain rebates on $0.3 billion of whole loan purchases by members of the Consortium prior to the signing of the Consortium Purchase Agreement. This $0.3 billion also reduces the up to $5.0 billion aggregate amount under the Consortium Purchase Agreement. Commitments and Contingencies Future Minimum Lease Payments Prosper has entered into various non-cancelable operating leases for certain offices with contractual lease periods expiring between 2022 and 2027 . The table below presents future minimum rental payments, net of minimum sublease rentals of $6.5 million , for the remaining terms of the operating leases (in thousands): Remainder of 2018 2,939 2019 6,026 2020 6,193 2021 6,170 2022 6,076 Thereafter 8,480 Total $ 35,884 The payments in the above table include amounts that have been accrued for as part of the restructuring liability in Note 14 – Restructuring. Accrual balances related to operating facility leases were $3.4 million at June 30, 2018 . Rental expense under operating lease arrangements was $1.0 million and $1.2 million for the three months ended June 30, 2018 and June 30, 2017 , respectively. Rental expense under operating lease arrangements was $2.1 million and $2.5 million for the six months ended June 30, 2018 and June 30, 2017 , respectively. Operating Commitments Prosper has entered into an agreement with WebBank, under which all Borrower Loans originated through the marketplace are made by WebBank under its bank charter. Pursuant to the 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 $143,500 , Prosper is required to pay WebBank an amount equal to such deficiency. Accordingly, the minimum fee for the remaining six months of 2018 is $0.9 million . The minimum fee is $0.9 million for the year 2019 . Additionally, under the agreement with WebBank, Prosper is required to maintain a 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. As of June 30, 2018 , Prosper was in compliance with the covenant. Loan Purchase Commitments Prosper has entered into an agreement with WebBank to purchase $31.5 million of Borrower Loans that WebBank originated during the last two business days of the quarter ended June 30, 2018 and the first business day of the quarter ending September 30, 2018 . Prosper will purchase these Borrower Loans within the first three business days of the quarter ending September 30, 2018 . Repurchase and Indemnification Contingency 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 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 and the initial fair value is insignificant. Prosper 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 obligation is the outstanding balances of the Borrower Loans issued through the Whole Loan Channel, which at June 30, 2018 is $3.9 billion . Prosper has accrued $1.3 million and $0.8 million as of June 30, 2018 and December 31, 2017 , respectively, in regard to this obligation. 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, we record the amount we consider to be the best estimate within the range of potential losses that are both probable and estimable; however, if we cannot quantify the amount of the estimated loss, then we record the low end of the range of those potential losses. SEC Inquiry In April and May of 2017, we became aware of an error in the annualized net return and seasoned annualized net return numbers displayed to note investors. Although we have since corrected the error, we are currently subject to an investigation by the Securities and Exchange Commission (the “SEC”) as to whether violations of federal securities laws have occurred in connection with this error. We have been fully and voluntarily cooperating with the SEC. We cannot predict the outcome of the investigation at this time and any potential fines or penalties, if any, that may arise from the investigation. Further, we are unable at this time to estimate a range of outcomes and as a result no accrual has been made. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Commitments and Contingencies | Consortium Purchase Agreement On February 27, 2017, Prosper entered into a series of agreements (the "Consortium Purchase Agreement") with a consortium of investors (the "Consortium"), pursuant to which the Consortium has agreed to purchase borrower loans in an aggregate principal amount of up to $5.0 billion (including certain loans purchased by one of the investors prior to the date of the Consortium Purchase Agreement). PFL will be obligated to offer for purchase minimum monthly volumes of eligible loans to the Consortium, for the Consortium to elect to purchase. In connection with the Consortium Purchase Agreement, PMI issued to the Consortium, three warrants to purchase up to an aggregate 177,720,706 shares of PMI’s Series F Preferred Stock at an exercise price of $0.01 per share (the “Warrant Shares”). The Consortium’s right to exercise the Series F Warrant is subject to monthly vesting during the term of the Consortium Purchase Agreement based upon the volume of loans the Consortium elects to purchase (if any) in each month, subject to certain cure rights such as offering additional loans for sale in subsequent periods. Pursuant to these cure rights, if the Consortium fails to respond to offers for allocation, purchase or funding, the Consortium can take advantage of a designated period of time to cure such failure. There have been no such failures by the Consortium to date. Under the terms of the Warrant Agreement, the 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 other events set forth in the Warrant Agreement. On vesting of the Series F warrants, Prosper records a liability as "Convertible Preferred Stock Warrant Liability" on the Condensed Consolidated Balance Sheet at fair value and a corresponding amount as "Fair Value of Warrants Vested on Sale of Borrower Loans" on the Condensed Consolidated Statement of Operations. Subsequent changes in the fair value of the vested warrants are recorded in "Change in Fair Value of Convertible Preferred Stock Warrants" on the Condensed Consolidated Statement of Operations. Additionally, in connection with the execution of the Consortium Purchase Agreement, certain previously issued rebates were settled by an issuance of vested Series F Convertible Preferred Stock Warrants. The difference in fair value of these warrants over the cash settlement price is recorded in "Change in Fair Value of Convertible Preferred Stock Warrants" on the Condensed Consolidated Statement of Operations. The following represents the loans purchased and warrants vested under the Consortium Purchase Agreement: Loans Acquired (in thousands) Warrants Vested Total as of December 31, 2017 $ 1,826,527 75,186,002 Loans Purchased by the Consortium during the six months ended June 30, 2018 831,097 36,830,278 Total as of June 30, 2018 $ 2,657,624 112,016,280 In addition to the $2.7 billion above, warrants vested on signing of the Consortium Purchase Agreement were issued to settle certain rebates on $0.3 billion of whole loan purchases by members of the Consortium prior to the signing of the Consortium Purchase Agreement. This $0.3 billion also reduces the up to $5.0 billion aggregate amount under the Consortium Purchase Agreement. Commitments and Contingencies Future Minimum Lease Payments Prosper has entered into various non-cancelable operating leases for certain offices with contractual lease periods expiring between 2022 and 2027 . The table below presents future minimum rental payments, net of minimum sublease rentals of $6.5 million , for the remaining terms of the operating leases (in thousands): Remainder of 2018 2,939 2019 6,026 2020 6,193 2021 6,170 2022 6,076 Thereafter 8,480 Total $ 35,884 The payments in the above table include amounts that have been accrued for as part of the restructuring liability in Note 14 – Restructuring. Accrual balances related to operating facility leases were $3.4 million at June 30, 2018 . Rental expense under operating lease arrangements was $1.0 million and $1.2 million for the three months ended June 30, 2018 and June 30, 2017 , respectively. Rental expense under operating lease arrangements was $2.1 million and $2.5 million for the six months ended June 30, 2018 and June 30, 2017 , respectively. Operating Commitments Prosper has entered into an agreement with WebBank, under which all Borrower Loans originated through the marketplace are made by WebBank under its bank charter. Pursuant to the 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 $143,500 , Prosper is required to pay WebBank an amount equal to such deficiency. Accordingly, the minimum fee for the remaining six months of 2018 is $0.9 million . The minimum fee is $0.9 million for the year 2019 . Additionally, under the agreement with WebBank, Prosper is required to maintain a 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. As of June 30, 2018 , Prosper was in compliance with the covenant. Loan Purchase Commitments Prosper has entered into an agreement with WebBank to purchase $31.5 million of Borrower Loans that WebBank originated during the last two business days of the quarter ended June 30, 2018 and the first business day of the quarter ending September 30, 2018 . Prosper will purchase these Borrower Loans within the first three business days of the quarter ending September 30, 2018 . Repurchase and Indemnification Contingency 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 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 and the initial fair value is insignificant. Prosper 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 obligation is the outstanding balances of the Borrower Loans issued through the Whole Loan Channel, which at June 30, 2018 is $3.9 billion . Prosper has accrued $1.3 million and $0.8 million as of June 30, 2018 and December 31, 2017 , respectively, in regard to this obligation. 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, we record the amount we consider to be the best estimate within the range of potential losses that are both probable and estimable; however, if we cannot quantify the amount of the estimated loss, then we record the low end of the range of those potential losses. SEC Inquiry In April and May of 2017, we became aware of an error in the annualized net return and seasoned annualized net return numbers displayed to note investors. Although we have since corrected the error, we are currently subject to an investigation by the Securities and Exchange Commission (the “SEC”) as to whether violations of federal securities laws have occurred in connection with this error. We have been fully and voluntarily cooperating with the SEC. We cannot predict the outcome of the investigation at this time and any potential fines or penalties, if any, that may arise from the investigation. Further, we are unable at this time to estimate a range of outcomes and as a result no accrual has been made. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Commitments and Contingencies | Commitments and Contingencies Operating Commitments Prosper has entered into an agreement with WebBank, under which all Borrower Loans originated through the marketplace are made by WebBank under its bank charter. Pursuant to the 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 $143,500 , Prosper is required to pay WebBank an amount equal to such deficiency. Accordingly, the minimum fee for the remaining six months of 2018 is $0.9 million . The minimum fee is $0.9 million for the year 2019 . Loan Purchase Commitments Under the terms of Prosper Funding’s agreement with WebBank, Prosper Funding is committed to purchase $31.5 million of Borrower Loans that WebBank originated during the last two business days of the quarter ended June 30, 2018 and first business day of the quarter ending September 30, 2018. Prosper Funding will purchase these Borrower Loans within the first three business days of the quarter ending September 30, 2018. Repurchase and Indemnification Contingency Under the terms of the loan purchase agreements between Prosper Funding and investors that participate in the Whole Loan Channel, Prosper Funding 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 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. Prosper Funding 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 obligation is the outstanding balances of the Borrower Loans issued through the Whole Loan Channel, which at June 30, 2018 is $3.9 billion . Prosper Funding had accrued $1.3 million and $0.8 million as of June 30, 2018 and December 31, 2017 , respectively, in regard to this obligation. 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, we record the amount we consider to be the best estimate within the range of potential losses that are both probable and estimable; however, if we cannot quantify the amount of the estimated loss, then we record the low end of the range of those potential losses. SEC Inquiry In April and May of 2017, we became aware of an error in the annualized net return and seasoned annualized net return numbers displayed to note investors. Although we have since corrected the error, we are currently subject to an investigation by the Securities and Exchange Commission (the “SEC”) as to whether violations of federal securities laws have occurred in connection with this error. We have been fully and voluntarily cooperating with the SEC. We cannot predict the outcome of the investigation at this time and any potential fines or penalties, if any, that may arise from the investigation. Further, we are unable at this time to estimate a range of outcomes and as a result no accrual has been made. |
Related Parties
Related Parties | 6 Months Ended |
Jun. 30, 2018 | |
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 and Borrower Loans. The aggregate amount of the Notes and Borrower Loans purchased and the income earned by parties deemed to be affiliates and related parties of Prosper for the three and six months ended June 30, 2018 and June 30, 2017 , as well as the Notes and Borrower Loans outstanding as of June 30, 2018 and December 31, 2017 are summarized below (in thousands): Aggregate Amount of Interest Earned on Notes and Borrower Loans Related Party 2018 2017 2018 2017 Executive officers and management $ 9 $ 10 $ 1 $ 81 Directors (excluding executive officers and management) 208 174 22 20 Total $ 217 $ 184 $ 23 $ 101 Aggregate Amount of Notes and Borrower Loans Purchased Three Months Ended March 31, Interest Earned on Notes and Borrower Loans Three Months Ended March 31, Related Party 2018 2017 2018 2017 Executive officers and management $ 3 $ 5 $ — $ 35 Directors (excluding executive officers and management) 107 85 11 10 Total $ 110 $ 90 $ 11 $ 45 Notes balance as of Related Party June 30, 2018 December 31, 2017 Executive officers and management $ 17 $ 38 Directors (excluding executive officers and management) 560 553 $ 577 $ 591 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Related Parties | Related Parties Since inception, Prosper Funding has engaged in various transactions with its directors, executive officers, and sole member, and immediate family members and other affiliates of its directors, executive officers, and sole member. Prosper Funding believes that all of the transactions described below were made on terms no less favorable to Prosper Funding than could have been obtained from unaffiliated third parties. Prosper Funding’s executive officers and directors who are not executive officers participate in its marketplace by placing bids and purchasing Notes and Borrower Loans. The aggregate amount of the Notes and Borrower Loans purchased and the income earned by parties deemed to be related parties of Prosper Funding as of June 30, 2018 and December 31, 2017 are summarized below (in thousands): Aggregate Amount of Notes and Borrower Loans Purchased Interest Earned on Notes and Borrower Loans Six Months Ended June 30, Six Months Ended June 30, Related Party 2018 2017 2018 2017 Executive officers and management $ 9 $ 10 $ 1 $ 81 Directors (excluding executive officers and management) — — — — Total $ 9 $ 10 $ 1 $ 81 Aggregate Amount of Notes and Borrower Loans Purchased Interest Earned on Notes and Borrower Loans Three Months Ended March 31, Three Months Ended March 31, Related Party 2018 2017 2018 2017 Executive officers and management $ 3 $ 5 $ — $ 35 Directors (excluding executive officers and management) — — — — Total $ 3 $ 5 $ — $ 35 Note and Borrower Loan Balance as of Related Party June 30, 2018 December 31, 2017 Executive officers and management $ 17 $ 38 Directors (excluding executive officers and management) — — $ 17 $ 38 |
Significant Concentrations
Significant Concentrations | 6 Months Ended |
Jun. 30, 2018 | |
Risks and Uncertainties [Abstract] | |
Significant Concentrations | Significant Concentrations Prosper is dependent on third party funding sources such as banks, assets 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 six months ended June 30, 2018 , the largest party purchased a total of 52% of those loans. This compares to 52% , 14% and 8% for the three largest parties for the six months ended June 30, 2017 . The party purchasing 14% for the six months ended June 30, 2017 is a member of the Consortium and purchased these loans prior to the closing of the Consortium Agreement on February 27, 2017. Further, a significant portion of our business is dependent on funding through the Whole Loan Channel, for which 93% and 92% of Borrower Loans were originated through the Whole Loan Channel in the six months ended June 30, 2018 and June 30, 2017 , respectively. Prosper receives all of its transaction fee revenue from WebBank. Prosper earns a transaction fee from WebBank for our services in facilitating originations of Borrower Loans issued by WebBank. The rate of the transaction fee for each individual Borrower Loan is based on the term and credit grade of the Borrower Loan. No individual borrower or investor accounted for 10% or more of consolidated net revenue for any of the periods presented. |
Summary of Significant Accoun26
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Basis of Presentation | Basis of Presentation Prosper Marketplace, Inc. (“PMI”) was incorporated in the state of Delaware on March 22, 2005. Except as the context requires otherwise, as used in these notes to the condensed consolidated financial statements of PMI, “Prosper,” “we,” “us,” and “our” refer to PMI and its wholly-owned subsidiaries, on a consolidated basis. The unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“US GAAP”) and disclosure requirements for interim financial information and the requirements of Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2017 . The balance sheet at December 31, 2017 has been derived from the audited financial statements at that date. Management believes these unaudited interim condensed consolidated financial statements reflect all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the results for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the full year or any other interim period. The preparation of Prosper’s condensed consolidated financial statements and related disclosures in conformity with US GAAP requires management to make judgments, assumptions and estimates that affect the amounts reported in Prosper’s financial statements and accompanying notes. Management bases its estimates on historical experience and on various other factors it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of certain assets and liabilities. These judgments, estimates and assumptions are inherently subjective in nature and actual results may differ from these estimates and assumptions. The accompanying interim condensed consolidated financial statements include the accounts of PMI and its wholly-owned subsidiaries. All intercompany balances have been eliminated in consolidation. |
Fair Value Measurements | Fair Value Measurements Financial instruments consist principally of Cash and Cash Equivalents, Restricted Cash, Available for Sale Investments at Fair Value, Borrower Loans, Loans Held for Sale, Accounts Receivable, Accounts Payable and Accrued Liabilities, Payable to Investors, Convertible Preferred Stock Warrant Liability 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. |
Restricted Cash | Restricted Cash Restricted cash consists primarily of cash deposits 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 or Prosper has 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 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 condensed consolidated balance sheets as assets and liabilities, respectively. We choose to measure certain financial instruments and certain other items at fair value on an instrument-by-instrument basis with unrealized gains and losses on items for which the fair value option has been elected reported in earnings. Management believes that the fair value option is more meaningful for the readers of the financial statements and it allows both the Borrower Loans and Notes to be valued using the same methodology. The fair value election, with respect to an item, may not be revoked once an election is made. Prosper estimates the fair value of such Borrower Loans and Notes using discounted cash flow methodologies that take into account expected prepayments, losses, recoveries and default rates. The Borrower Loans are not derecognized when a corresponding Note is issued as Prosper maintains the ability to sell the Borrower Loans without the approval of the holders of the corresponding Notes. |
Debt | Debt For debt instruments carried at amortized cost, the Company defers specific incremental costs directly related to issuing debt or entering into revolving debt arrangements. Debt issuance costs associated with revolving debt arrangements are presented as an asset and subsequently amortized over the term of the revolving debt arrangement. |
Revenues | Revenues Revenue primarily results from fees and net interest income earned. Fees include transaction fees for our services performed on behalf of WebBank to originate a loan. We also have other smaller sources of revenue reported as other revenue, including referral fees and securitization fees. For more information about Prosper's revenues, see Note 2 of the Notes to the Consolidated Financial Statements in Part IV, Item 15 of our Annual Report on Form 10-K for the year ended December 31, 2017. 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, which is upon the successful origination of a Borrower Loan and which is similar to the recognition prior to the adoption of ASC 606. 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 5.00% of the original principal amount of such 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. Other Revenues Other Revenues consist primarily of securitization fees and credit referral fees. Credit referral fees are where partner companies pay us an agreed upon amount for successful referrals of customers from our marketplace. The transaction price is a fixed amount per referral and is recognized by the Company upon a successful referral which is similar to the recognition prior to the adoption of ASC 606. Securitization fees represent fees Prosper earns to facilitate securitizations for purchasers of Borrower Loans and is recognized as other revenue when the securitization is completed which is similar to the recognition prior to the adoption of ASC 606. In some instances Prosper may also provide a guarantee, which requires us to first determine the fair value of the guarantee and allocate the remaining transaction price to the securitization performance obligation. As of June 30, 2018 Prosper had no material contract assets, contract liabilities or deferred contract costs. As of June 30, 2018 , Prosper had no unsatisfied performance obligations related to transaction fee or other revenues. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Standards Adopted In The Current Period In May 2014, as part of its ongoing efforts to assist in the convergence of US GAAP and International Financial Reporting Standards (“IFRS”), the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, “ Revenue from Contracts with Customers. ” The new guidance sets forth a new five-step revenue recognition model which replaces the prior revenue recognition guidance in its entirety and is intended to eliminate numerous industry-specific pieces of revenue recognition guidance that have historically existed in U.S. GAAP. The underlying principle of the new standard is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects in exchange for the goods or services. The standard also requires more detailed disclosures and provides additional guidance for transactions that were not addressed completely in the prior accounting guidance. Prosper adopted the requirements of the ASU as of January 1, 2018, utilizing the modified retrospective approach. Transaction fees, securitization fees and credit referral fees are included in the scope of the new guidance, while servicing fees, net interest income and gain or loss on the sale of loans remain within the scope of ASC topic 860, Transfers and Servicing or ASC topic 310. The impact of adopting the ASU did not result in a material cumulative effect adjustment upon the date of adoption. Additionally, the impact of adoption on the Consolidated Financial Statements for the current period is insignificant. In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” The standard provides guidance for eight targeted changes with respect to how cash receipts and cash payments are classified in the statements of cash flows, with the objective of reducing diversity in practice. Prosper adopted the standard effective January 1, 2018. The adoption of this standard did not have a material impact on Prosper’s consolidated financial statements. In October 2016, the FASB issued ASU No. 2016-16, " Income Taxes (Topic 740): Intra-Entity Transfers Other than Inventory (ASU 2016-16)," which requires companies to recognize the income-tax consequences of an intra-entity transfer of an asset other than inventory. Prosper adopted the standard effective January 1, 2018, the adoption of this standard did not have a material impact on Prosper’s consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, " Statement of Cash Flows (Topic 230): Restricted Cash (ASU 2016-18)," which requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Prosper adopted the standard effective January 1, 2018. Prosper had $134.6 million and $179.3 million of restricted cash on its consolidated balance sheet as of June 30, 2018 and June 30, 2017 , respectively, whose cash flow statement classification changed to align with the new guidance. In January 2016, the FASB issued ASU 2016-01, "Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities," which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. Prosper adopted standard effective January 1, 2018. The adoption of this standard did not have a material impact on Prosper’s consolidated financial statements. Accounting Standards Issued, To Be Adopted By The Company In Future Periods In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , which requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. This guidance will be effective for us in the first quarter of our fiscal year 2019, and early adoption is permitted. Prosper is currently evaluating the impact that this guidance will have on its consolidated financial statements. We do expect that this guidance will have a material impact on Prosper's consolidated financial statements. As of June 30, 2018 Prosper had a total of $35.9 million in non-cancelable operating lease commitments. In January 2017, the FASB issued ASU No. 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. " The standard eliminates Step 2 from the goodwill impairment test, which requires a hypothetical purchase price allocation. Prosper will continue to have the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The standard is effective for interim and annual periods beginning after December 15, 2019 and early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The standard should be applied on a prospective basis. Prosper is currently evaluating the impact of this accounting standard update on its consolidated financial statements. In June 2018, the FASB issued ASU No. 2018-07 , "Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. " The ASU is intended to reduce the cost and complexity and to improve financial reporting for nonemployee share-based payments. The ASU expands the scope of Topic 718, Compensation-Stock Compensation , which currently only includes share-based payments to employees, to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. This ASU is effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year and early adoption is permitted, but no earlier than a company’s adoption date of Topic 606, Revenue from Contracts with Customers . Prosper is currently evaluating the impact of this accounting standard update on its consolidated financial statements. |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Basis of Presentation | Basis of Presentation Prosper Funding LLC (“PFL”) was formed in the state of Delaware on February 17, 2012 as a limited liability company with the sole equity member being Prosper Marketplace, Inc. (“PMI”). Except as the context otherwise requires, as used in these Notes to the condensed consolidated financial statements of Prosper Funding LLC, “Prosper Funding,” “we,” “us,” and “our” refers to PFL and its wholly owned subsidiaries, Prosper Asset Holdings LLC (“PAH”), a Delaware limited liability company, and Prosper Depositor LLC, a Delaware limited liability company, on a consolidated basis. The unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“US GAAP”) and disclosure requirements for interim financial information and the requirements of Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. The unaudited interim condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2017 . The balance sheet at December 31, 2017 has been derived from the audited financial statements at that date. Management believes these unaudited interim condensed consolidated financial statements reflect all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the results for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the full year or any other interim period. Prosper Funding did no t have any items of other comprehensive income (loss) during any of the periods presented in the condensed consolidated financial statements as of and for the six months ended June 30, 2018 and June 30, 2017 . The preparation of Prosper Funding's condensed consolidated financial statements and related disclosures in conformity with US GAAP requires management to make judgments, assumptions and estimates that affect the amounts reported in its condensed consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other factors it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of certain assets and liabilities. These judgments, estimates and assumptions are inherently subjective in nature and actual results may differ from these estimates and assumptions, and the differences could be material. |
Fair Value Measurements | Fair Value Measurements Financial instruments consist principally of Cash and Cash Equivalents, Restricted Cash, Short Term Investments, Borrower Loans, Loans Held for Sale, 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. |
Restricted Cash | Restricted Cash Restricted cash consists primarily of cash deposits 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 or Prosper has 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 Through the Note Channel, Prosper Funding 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 Prosper Funding’s consolidated balance sheets as assets and liabilities, respectively. We choose to measure certain financial instruments and certain other items at fair value on an instrument-by-instrument basis with unrealized gains and losses on items for which the fair value option has been elected reported in earnings. Management believes that the fair value option is more meaningful for the readers of the financial statements and it allows both the Borrower Loans and Notes to be valued using the same methodology. The fair value election, with respect to an item, may not be revoked once an election is made. Prosper Funding estimates the fair value of such Borrower Loans and Notes using discounted cash flow methodologies that take into account expected prepayments, losses, recoveries and default rates. The Borrower Loans are not derecognized when a corresponding Note is issued as Prosper Funding maintains the ability to sell the Borrower Loans without the approval of the holders of the corresponding Notes. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Standards Adopted In The Current Period In May 2014, as part of its ongoing efforts to assist in the convergence of US GAAP and International Financial Reporting Standards (“IFRS”), the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers.” The new guidance sets forth a new five-step revenue recognition model which replaces the prior revenue recognition guidance in its entirety and is intended to eliminate numerous industry-specific pieces of revenue recognition guidance that have historically existed in US GAAP. The underlying principle of the new standard is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects in exchange for the goods or services. The standard also requires more detailed disclosures and provides additional guidance for transactions that were not addressed completely in the prior accounting guidance. Prosper Funding adopted the requirements of the ASU as of January 1, 2018, utilizing the modified retrospective approach. Administration fees are included in the scope of the new guidance, while servicing fees and gain or loss on the sale of loans remain within the scope of ASC topic 860, Transfers and Servicing. The impact of adopting the ASU is not significant to the Consolidated Financial Statements in the current period. In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” The standard provides guidance for eight targeted changes with respect to how cash receipts and cash payments are classified in the statements of cash flows, with the objective of reducing diversity in practice. Prosper Funding adopted standard effective January 1, 2018. The adoption of this standard did not have a material impact on Prosper Funding’s consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, "Statement of Cash Flows (Topic 230): Restricted Cash (ASU2016-18)," which requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Prosper Funding adopted standard effective January 1, 2018. Prosper Funding has $120.2 million and $165.6 million of restricted cash on its consolidated balance sheet as of June 30, 2018 and 2017 , respectively, whose cash flow statement classification changed to align with the new guidance. In January 2016, the FASB issued ASU 2016-01, "Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities," which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. Prosper Funding adopted standard effective January 1, 2018. The adoption of this standard did not have a material impact on Prosper Funding’s consolidated financial statements. |
Summary of Significant Accoun27
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Schedule of Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amount shown in the condensed consolidated statements of cash flows: June 30, December 31, June 30, December 31, Cash and Cash Equivalents $ 58,652 45,795 $ 34,667 $ 22,337 Restricted Cash 134,552 152,668 179,331 163,907 Total Cash, Cash Equivalents and Restricted Cash shown in the consolidated statements of cash flows $ 193,204 $ 198,463 $ 213,998 $ 186,244 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Schedule of Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amount shown in the consolidated statements of cash flows: June 30, December 31, June 30, December 31, Cash and Cash Equivalents $ 10,892 8,223 $ 12,384 $ 6,929 Restricted Cash 120,152 140,092 165,628 147,983 Total Cash, Cash Equivalents and Restricted Cash show in the consolidated statements of cash flows $ 131,044 $ 148,315 $ 178,012 $ 154,912 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Property and Equipment, Net | Property and equipment consist of the following (in thousands): June 30, December 31, Property and equipment: Computer equipment $ 14,785 $ 14,499 Internal-use software and website development costs 21,372 19,910 Office equipment and furniture 3,010 3,010 Leasehold improvements 7,078 7,078 Assets not yet placed in service 1,893 1,216 Property and equipment 48,138 45,713 Less accumulated depreciation and amortization (32,057 ) (27,577 ) Total property and equipment, net $ 16,081 $ 18,136 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Property and Equipment, Net | Property and equipment consist of the following (in thousands): June 30, December 31, Property and equipment: Internal-use software and web site development costs $ 21,372 $ 19,911 Less accumulated depreciation and amortization (14,400 ) (11,958 ) Total property and equipment, net $ 6,972 $ 7,953 |
Borrower Loans, Loans Held fo29
Borrower Loans, Loans Held for Sale, and Notes Held at Fair Value (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Aggregate Principal Balances Outstanding and Fair Values of Borrower Loans, Notes and Loans Held for Sale | The aggregate principal balances outstanding and fair values of Borrower Loans, Loans Held for Sale, and Notes as of June 30, 2018 and December 31, 2017 , are presented in the following table (in thousands): Borrower Loans Notes Loans Held for Sale June 30, December 31, June 30, December 31, June 30, December 31, Aggregate principal balance outstanding $ 280,852 $ 296,668 $ (284,011 ) $ (300,922 ) $ 117,028 $ 59 Fair value adjustments (3,491 ) (3,663 ) 6,586 6,974 (211 ) (10 ) Fair value $ 277,361 $ 293,005 $ (277,425 ) $ (293,948 ) $ 116,817 $ 49 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Aggregate Principal Balances Outstanding and Fair Values of Borrower Loans, Notes and Loans Held for Sale | The aggregate principal balances outstanding and fair values of Borrower Loans, Loans Held for Sale, and Notes as of June 30, 2018 and December 31, 2017 , are presented in the following table (in thousands): Borrower Loans Notes Loans Held for Sale June 30, 2018 December 31, 2017 June 30, 2018 December 31, 2017 June 30, 2018 December 31, 2017 Aggregate principal balance outstanding $ 280,852 $ 296,668 $ (284,011 ) $ (300,922 ) $ 44 $ 59 Fair value adjustments (3,491 ) (3,663 ) 6,586 6,974 (13 ) (10 ) Fair value $ 277,361 $ 293,005 $ (277,425 ) $ (293,948 ) $ 31 $ 49 |
Available for Sale Investment30
Available for Sale Investments, at Fair Value (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Amortized Cost, Gross Unrealized Gains and Losses and Fair Value of Securities Available for Sale | The amortized cost, gross unrealized gains and losses, and fair value of available for sale investments as of June 30, 2018 and December 31, 2017 , are as follows (in thousands): June 30, 2018 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fixed maturity securities: Treasury Bills 20,668 — (23 ) 20,645 US Treasury securities 14,232 — (36 ) 14,196 Total Available for Sale Investments $ 34,900 $ — $ (59 ) $ 34,841 December 31, 2017 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fixed maturity securities: Treasury Bills $ 34,014 $ — $ (36 ) $ 33,978 US Treasury securities 19,207 — (38 ) 19,169 Total Available for Sale Investments $ 53,221 $ — $ (74 ) $ 53,147 |
Summary of Securities Available for Sale of Continuous Unrealized Loss | A summary of available for sale investments with unrealized losses as of June 30, 2018 , and December 31, 2017 , aggregated by category and period of continuous unrealized loss, is as follows (in thousands): Less than 12 months 12 months or longer Total June 30, 2018 Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Fixed maturity securities: Treasury Bills $ 20,645 $ (23 ) $ — $ — $ 20,645 $ (23 ) US Treasury securities $ 14,196 $ (36 ) $ — $ — $ 14,196 $ (36 ) Total Investments with Unrealized Losses $ 34,841 $ (59 ) $ — $ — $ 34,841 $ (59 ) Less than 12 months 12 months or longer Total December 31, 2017 Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Fixed maturity securities: Treasury Bills $ 33,978 $ (36 ) $ — $ — $ 33,978 $ (36 ) US Treasury securities $ 19,169 $ (38 ) $ — $ — $ 19,169 $ (38 ) Total Investments with Unrealized Losses $ 53,147 $ (74 ) $ — $ — $ 53,147 $ (74 ) |
Schedule of Maturities of Securities Available for Sale | The maturities of available for sale investments at June 30, 2018 and December 31, 2017 are as follows (in thousands): June 30, 2018 Within 1 year After 1 year through 5 years After 5 years to 10 years After 10 years Total Treasury Bills 20,645 — — — 20,645 US Treasury securities 14,196 — — — 14,196 Total Fair Value $ 34,841 $ — $ — $ — $ 34,841 Total Amortized Cost $ 34,900 $ — $ — $ — $ 34,900 December 31, 2017 Within 1 year After 1 year through 5 years After 5 years to 10 years After 10 years Total Treasury Bills 33,978 — — — 33,978 US Treasury securities 14,947 4,222 — — 19,169 Total Fair Value $ 48,925 $ 4,222 $ — $ — $ 53,147 Total Amortized Cost $ 48,992 $ 4,229 $ — $ — $ 53,221 |
Fair Value of Assets and Liab31
Fair Value of Assets and Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
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): June 30, 2018 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans $ 277,361 $ 277,361 Loans Held for Sale 116,817 116,817 Available for Sale Investments, at Fair Value 34,841 — 34,841 Servicing Assets 15,644 15,644 Total Assets — 34,841 409,822 444,663 Liabilities: Notes $ 277,425 $ 277,425 Servicing Liabilities 28 28 Convertible Preferred Stock Warrant Liability 143,676 143,676 Loan Trailing Fee Liability 3,078 3,078 Total Liabilities $ — $ — $ 424,207 $ 424,207 December 31, 2017 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans $ — $ — $ 293,005 $ 293,005 Loans Held for Sale — — 49 49 Available for Sale Investments, at Fair Value — 53,147 — 53,147 Servicing Assets — — 14,711 14,711 Total Assets — 53,147 307,765 360,912 Liabilities: Notes $ — $ — $ 293,948 $ 293,948 Servicing Liabilities — — 59 59 Convertible Preferred Stock Warrant Liability — — 116,366 116,366 Loan Trailing Fee Liability — — 2,595 2,595 Total Liabilities $ — $ — $ 412,968 $ 412,968 |
Quantitative Information About Significant Unobservable Inputs | Borrower Loans, Loans Held for Sale and Notes: Range Unobservable Input June 30, 2018 December 31, 2017 Discount rate 4.4% - 13.9% 4.0% - 14.4% Default rate 2.0% - 15.6% 2.0% - 15.4% |
Significant Unobservable Inputs Fair Value | Servicing Rights Range Unobservable Input June 30, 2018 December 31, 2017 Discount rate 15% - 25% 15% - 25% Default rate 1.6% - 16.5% 1.5% - 16.1% Prepayment rate 15.2% - 32.9% 13.5% - 30.2% Market servicing rate 0.625 % 0.625 % Loan Trailing Fee Liability: Range Unobservable Input June 30, 2018 December 31, 2017 Discount rate 15% - 25% 15% - 25% Default rate 1.6% - 16.5% 1.5% - 16.1% Prepayment rate 15.2% - 32.9% 13.5% - 30.2% |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following tables present additional information about level 3 Borrower Loans, Loans Held for Sale and Notes measured at fair value on a recurring basis (in thousands): Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at January 1, 2018 $ 293,005 $ (293,948 ) $ 49 $ (894 ) Purchase of Borrower Loans/Issuance of Notes 91,075 (90,693 ) 1,324,100 1,324,482 Principal repayments (88,947 ) 91,525 (14,265 ) (11,687 ) Borrower Loans sold to third parties (2,016 ) — (1,193,651 ) (1,195,667 ) Other changes (338 ) 633 796 1,091 Change in fair value (15,418 ) 15,058 (212 ) (572 ) Balance at June 30, 2018 $ 277,361 $ (277,425 ) $ 116,817 $ 116,753 Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at January 1, 2017 $ 315,627 $ (316,236 ) $ 624 $ 15 Purchase of Borrower Loans/Issuance of Notes 106,940 (106,506 ) 1,245,826 1,246,260 Principal repayments (97,492 ) 100,274 (42 ) 2,740 Borrower Loans sold to third parties (1,990 ) — (1,246,316 ) (1,248,306 ) Other changes 9 266 (3 ) 272 Change in fair value (10,822 ) 10,792 6 (24 ) Balance at June 30, 2017 $ 312,272 $ (311,410 ) $ 95 $ 957 Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at April 1, 2018 $ 285,584 $ (285,095 ) $ 82,803 $ 83,292 Purchase of Borrower Loans/Issuance of Notes 44,799 (44,468 ) 728,901 729,232 Principal repayments (43,990 ) 44,423 (10,416 ) (9,983 ) Borrower Loans sold to third parties (950 ) — (683,547 ) (684,497 ) Other changes (202 ) 86 255 139 Change in fair value (7,880 ) 7,629 (1,179 ) (1,430 ) Balance at June 30, 2018 $ 277,361 $ (277,425 ) $ 116,817 $ 116,753 Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at April 1, 2017 $ 317,536 $ (316,944 ) $ 109 $ 701 Purchase of Borrower Loans/Issuance of Notes 50,260 (49,692 ) 721,829 722,397 Principal repayments (48,048 ) 48,695 (14 ) 633 Borrower Loans sold to third parties (869 ) — (721,829 ) (722,698 ) Other changes 10 (156 ) — (146 ) Change in fair value (6,617 ) 6,687 — 70 Balance at June 30, 2017 $ 312,272 $ (311,410 ) $ 95 $ 957 |
Schedule of Servicing Assets and Liabilities Measured at Fair Value | The following table presents additional information about level 3 Loan Trailing Fee Liability measured at fair value on a recurring basis (in thousands): Balance at January 1, 2018 2,595 Issuances 1,529 Cash payment of Loan Trailing Fee (1,206 ) Change in fair value 160 Balance as of June 30, 2018 3,078 The following tables present additional information about level 3 servicing assets and liabilities measured at fair value on a recurring basis (in thousands): Servicing Assets Servicing Liabilities Fair Value at January 1, 2018 14,711 59 Additions 7,502 — Less: Changes in fair value (6,569 ) (31 ) Fair Value at June 30, 2018 15,644 28 Servicing Assets Servicing Liabilities Fair Value at January 1, 2017 12,786 198 Additions 6,532 — Less: Changes in fair value (5,829 ) (87 ) Fair Value at June 30, 2017 13,489 111 Servicing Assets Servicing Liabilities Fair Value at April 1, 2018 14,754 41 Additions 4,163 — Less: Changes in fair value (3,273 ) (13 ) Fair Value at June 30, 2018 15,644 28 Servicing Assets Servicing Liabilities Fair Value at April 1, 2017 12,436 147 Additions 3,768 — Less: Changes in fair value (2,715 ) (36 ) Fair Value at June 30, 2017 13,489 111 The following table presents additional information about level 3 Preferred Stock Warrant Liability measured at fair value on a recurring basis (in thousands): Balance as of January 1, 2018 $ 116,366 Add Issuances of Preferred Stock Warrant 35,912 Change in fair value of the preferred stock warrant liability (8,602 ) Balance at June 30, 2018 $ 143,676 Balance as of January 1, 2017 $ — Add Issuances of Preferred Stock Warrant 47,297 Change in fair value of the preferred stock warrant liability 22,817 Balance at June 30, 2017 $ 70,114 Balance as of April 1, 2018 $ 127,041 Add Issuances of Preferred Stock Warrant 20,633 Change in fair value of the preferred stock warrant liability (3,998 ) Balance at June 30, 2018 $ 143,676 Balance as of April 1, 2017 $ 30,811 Add Issuances of Preferred Stock Warrant 16,887 Change in fair value of the preferred stock warrant liability 22,416 Balance at June 30, 2017 $ 70,114 |
Fair Value Assumptions for Loans Held for Sale, Borrower Loans and Notes | Key economic assumptions and the sensitivity of the current fair value to immediate changes in those assumptions at June 30, 2018 for Borrower Loans, Loans Held for Sale and Notes funded through the Note Channel are presented in the following table (in thousands, except percentages): Borrower Loans and Loans Held for Sale Notes Fair Value as of June 30, 2018 $394,178 $277,425 Discount rate assumption: 7.52 % * 7.52 % * Resulting fair value from: 100 basis point increase $ 390,255 $ 274,660 200 basis point increase 386,431 271,964 Resulting fair value from: 100 basis point decrease $ 398,202 $ 280,262 200 basis point decrease 402,333 283,173 Default rate assumption: 13.11 % * 13.11 % * Resulting fair value from: 100 basis point increase $ 389,288 $ 273,967 200 basis point increase 384,542 270,612 Resulting fair value from: 100 basis point decrease $ 399,107 $ 280,911 200 basis point decrease 404,079 284,428 * Represents weighted average assumptions considering all credit grades. |
Schedule of Prosper's and Prosper Funding's Estimated Fair Value of Servicing Assets and Liabilities | The following table presents the estimated impact on Prosper’s estimated fair value of servicing assets and liabilities, calculated using different market servicing rates and different default rates as of June 30, 2018 (in thousands, except percentages). Servicing Assets Servicing Liabilities Fair Value as of June 30, 2018 $15,644 $28 Market servicing rate assumptions 0.625 % 0.625 % Resulting fair value from: Market servicing rate increase to 0.65% $ 14,691 $ 31 Market servicing rate decrease to 0.60% $ 16,634 $ 25 Weighted average prepayment assumptions 19.98 % 19.98 % Resulting fair value from: Applying a 1.1 multiplier to prepayment rate $ 15,471 $ 28 Applying a 0.9 multiplier to prepayment rate $ 15,857 $ 29 Weighted average default assumptions 12.66 % 12.66 % Resulting fair value from: Applying a 1.1 multiplier to default rate $ 15,473 $ 28 Applying a 0.9 multiplier to default rate $ 15,857 $ 28 |
Financial Instruments, Assets And Liabilities Not Recorded At Fair Value | The following tables present the fair value hierarchy for financial instruments, assets, and liabilities not recorded at fair value (in thousands): June 30, 2018 Carrying Amount Level 1 Inputs Level 2 Inputs Level 3 Inputs Balance at Fair Value Assets: Cash and Cash Equivalents $ 58,652 $ 58,652 $ — $ — $ 58,652 Restricted Cash 134,552 — 134,552 — 134,552 Accounts Receivable 3,539 — 3,539 — 3,539 Total Assets 196,743 58,652 138,091 — 196,743 Liabilities: Accounts Payable and Accrued Liabilities $ 14,652 $ — $ 14,652 $ — $ 14,652 Payable to Investors 112,580 — 112,580 — 112,580 Warehouse Line 103,553 — 103,553 — 103,553 Total Liabilities $ 230,785 $ — $ 230,785 $ — $ 230,785 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
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): June 30, 2018 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans $ — $ — $ 277,361 $ 277,361 Servicing Assets — — 16,162 16,162 Loans Held for Sale — — 31 31 Total Assets — — 293,554 293,554 Liabilities: Notes $ — $ — $ 277,425 $ 277,425 Servicing Liabilities — — 28 28 Loan Trailing Fee Liability — — 3,078 3,078 Total Liabilities $ — $ — $ 280,531 $ 280,531 December 31, 2017 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Borrower Loans $ — $ — $ 293,005 $ 293,005 Servicing Assets — — 14,598 14,598 Loans Held for Sale — — 49 49 Total Assets — — 307,652 307,652 Liabilities: Notes $ — $ — $ 293,948 $ 293,948 Servicing Liabilities — — 59 59 Loan Trailing Fee Liability — — 2,595 2,595 Total Liabilities $ — $ — $ 296,602 $ 296,602 |
Quantitative Information About Significant Unobservable Inputs | The following tables present quantitative information about the significant unobservable inputs used for Prosper Funding’s level 3 fair value measurements at June 30, 2018 and December 31, 2017 : Borrower Loans, Loans Held for Sale and Notes: Range Unobservable Input June 30, 2018 December 31, 2017 Discount rate 4.4% - 13.9% 4.0% - 14.4% Default rate 2.0% - 15.6% 2.0% - 15.4% |
Significant Unobservable Inputs Fair Value | Servicing Assets and Liabilities: Range Unobservable Input June 30, 2018 December 31, 2017 Discount rate 15% - 25% 15% - 25% Default rate 1.6% - 16.5% 1.5% - 16.1% Prepayment rate 15.2% - 32.9% 13.5% - 30.2% Market servicing rate 0.625 % 0.625 % Loan Trailing Fee Liability: Range Unobservable Input June 30, 2018 December 31, 2017 Discount rate 15% - 25% 15% - 25% Default rate 1.6% - 16.5% 1.5% - 16.1% Prepayment rate 15.2% - 32.9% 13.5% - 30.2% |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | The changes in the Borrower Loans, Loans Held for Sale and Notes, which are level 3 assets and liabilities measured at fair value on a recurring basis are as follows (in thousands): Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at January 1, 2018 $ 293,005 $ (293,948 ) $ 49 $ (894 ) Originations 91,075 (90,693 ) 1,324,100 1,324,482 Principal repayments (88,947 ) 91,525 (14 ) 2,564 Borrower Loans sold to third parties (2,016 ) — (1,324,100 ) (1,326,116 ) Other changes (338 ) 633 — 295 Change in fair value (15,418 ) 15,058 (4 ) (364 ) Balance at June 30, 2018 $ 277,361 $ (277,425 ) $ 31 $ (33 ) Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at January 1, 2017 $ 315,627 $ (316,236 ) $ 624 $ 15 Originations 106,940 (106,506 ) 1,245,826 1,246,260 Principal repayments (97,492 ) 100,274 (42 ) 2,740 Borrower Loans sold to third parties (1,990 ) — (1,246,316 ) (1,248,306 ) Other changes 9 266 (3 ) 272 Change in fair value (10,822 ) 10,792 6 (24 ) Balance at June 30, 2017 $ 312,272 $ (311,410 ) $ 95 $ 957 Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at April 1, 2018 $ 285,584 $ (285,095 ) $ 41 $ 530 Originations 44,799 (44,468 ) 728,901 729,232 Principal repayments (43,990 ) 44,423 (6 ) 427 Borrower Loans sold to third parties (950 ) — (728,901 ) (729,851 ) Other changes (202 ) 86 — (116 ) Change in fair value (7,880 ) 7,629 (4 ) (255 ) Balance at June 30, 2018 $ 277,361 $ (277,425 ) $ 31 $ (33 ) Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Borrower Loans Notes Loans Held for Sale Total Balance at April 1, 2017 $ 317,536 $ (316,944 ) $ 109 $ 701 Originations 50,260 (49,692 ) 721,829 722,397 Principal repayments (48,048 ) 48,695 (14 ) 633 Borrower Loans sold to third parties (869 ) — (721,829 ) (722,698 ) Other changes 10 (156 ) — (146 ) Change in fair value (6,617 ) 6,687 — 70 Balance at June 30, 2017 $ 312,272 $ (311,410 ) $ 95 $ 957 |
Schedule of Servicing Assets and Liabilities Measured at Fair Value | The following table presents additional information about level 3 servicing assets and liabilities recorded at fair value for the three months ended June 30, 2018 (in thousands). Servicing Assets Servicing Liabilities Fair Value at January 1, 2018 14,598 59 Additions 8,147 — Less: Changes in fair value (6,583 ) (31 ) Fair Value at June 30, 2018 16,162 28 Servicing Assets Servicing Liabilities Fair Value at January 1, 2017 12,461 198 Additions 6,532 — Less: Changes in fair value (5,696 ) (87 ) Fair Value at June 30, 2017 13,297 111 Servicing Assets Servicing Liabilities Fair Value at April 1, 2018 15,023 41 Additions 4,452 — Less: Changes in fair value (3,313 ) (13 ) Fair Value at June 30, 2018 16,162 28 Servicing Assets Servicing Liabilities Fair Value at April 1, 2017 12,190 147 Additions 3,768 — Less: Changes in fair value (2,661 ) (36 ) Fair Value at June 30, 2017 13,297 111 The following table presents additional information about level 3 Loan Trailing Fee Liability measured at fair value on a recurring basis (in thousands): Balance at January 1, 2018 2,595 Issuances 1,529 Cash payment of Loan Trailing Fee (1,206 ) Change in fair value 160 Balance as of June 30, 2018 3,078 |
Fair Value Assumptions for Loans Held for Sale, Borrower Loans and Notes | Key economic assumptions and the sensitivity of the current fair value to immediate changes in those assumptions at June 30, 2018 for Borrower Loans, Loans Held for Sale and Notes funded are presented in the following table (in thousands, except percentages): Borrower Loans and Loans Held for Sale Notes Fair Value as of June 30, 2018 $ 277,392 $ 277,425 Discount rate assumption: 7.52 % * 7.52 % * Resulting fair value from: 100 basis point increase $ 274,662 $ 274,660 200 basis point increase 271,970 271,964 Resulting fair value from: 100 basis point decrease $ 280,255 $ 280,262 200 basis point decrease 283,162 283,173 Default rate assumption: 13.11 % * 13.11 % * Resulting fair value from: 100 basis point increase $ 273,981 $ 273,967 200 basis point increase 270,641 270,612 Resulting fair value from: 100 basis point decrease $ 280,892 $ 280,911 200 basis point decrease 284,391 284,428 * Represents weighted average assumptions considering all credit grades. |
Schedule of Prosper's and Prosper Funding's Estimated Fair Value of Servicing Assets and Liabilities | The following table presents the estimated impact on Prosper Funding’s estimated fair value of servicing assets and liabilities, calculated using different market servicing rates and different default rates as of June 30, 2018 (in thousands, except percentages). Servicing Assets Servicing Liabilities Fair Value as of June 30, 2018 $ 16,162 $ 28 Market servicing rate assumptions 0.625 % 0.625 % Resulting fair value from: Market servicing rate increase to 0.65% 15,160 31 Market servicing rate decrease to 0.60% 17,165 25 Weighted average prepayment assumptions 19.98 % 19.98 % Resulting fair value from: Applying a 1.1 multiplier to prepayment rate 15,964 28 Applying a 0.9 multiplier to prepayment rate 16,363 29 Weighted average default assumptions 12.66 % 12.66 % Resulting fair value from: Applying a 1.1 multiplier to default rate 15,967 28 Applying a 0.9 multiplier to default rate 16,362 28 |
Goodwill and Other Intangible32
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Other Intangible Assets for the Period Presented | The following table presents the detail of other intangible assets for the period presented (dollars in thousands): June 30, 2018 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 (3,873 ) $ 1,177 6.8 Brand name 60 (60 ) — — Total intangible assets subject to amortization $ 8,170 $ (6,993 ) $ 1,177 |
Summary of Estimated Amortization of Purchased Intangible Assets | Estimated amortization of purchased intangible assets for future periods is as follows (in thousands): Year Ending December 31, Remainder of 2018 $ 178 2019 279 2020 220 2021 172 2022 136 Thereafter $ 192 Total $ 1,177 |
Other Liabilities (Tables)
Other Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Other Liabilities [Abstract] | |
Schedule of Other Liabilities | Other Liabilities includes the following: June 30, 2018 December 31, 2017 Loan trailing fee 3,078 2,595 Deferred revenue 436 452 Servicing liabilities 28 59 Deferred income tax liability 244 225 Deferred rent 3,651 3,904 Restructuring liability 3,457 3,355 Other 2,824 2,079 Total Other Liabilities $ 13,718 $ 12,669 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Net Loss Per Share | Basic and diluted net loss per share was calculated as follows: Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Numerator: Net loss available to common stockholders for basic and diluted EPS $ (12,599 ) $ (41,405 ) $ (24,000 ) $ (65,426 ) Denominator: Weighted average shares used in computing basic and diluted net loss per share 70,362,716 69,691,841 70,333,145 69,436,365 Basic and diluted net loss per share $ (0.18 ) $ (0.59 ) $ (0.34 ) $ (0.94 ) |
Common Stock Equivalents Excluded from Computation of Diluted Net Loss Per Share | The following common stock equivalents were excluded from the computation of diluted net loss per share for the periods presented because including them would have been anti-dilutive: Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 (shares) (shares) (shares) (shares) Excluded securities: Convertible preferred stock issued and outstanding 214,637,925 177,388,428 214,637,925 177,388,428 Stock options issued and outstanding 75,206,928 60,938,265 66,403,696 53,040,604 Unvested stock options exercised 2,190 20,940 2,190 20,940 Restricted stock units — — — — Warrants issued and outstanding 1,080,349 1,199,403 1,082,917 1,199,403 Series E-1 convertible preferred stock warrants 35,544,141 35,544,141 35,544,141 35,544,141 Series F convertible preferred stock warrants 177,720,704 177,720,704 177,720,704 177,720,704 Total common stock equivalents excluded from diluted net loss per common share computation 504,192,237 452,811,881 495,391,573 444,914,220 |
Convertible Preferred Stock, 35
Convertible Preferred Stock, Warrant Liability and Stockholders’ Deficit (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Stockholders' Equity Note [Abstract] | |
Summary 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 June 30, 2018 are disclosed in the table below (amounts in thousands except share and per share amounts): Convertible Preferred Stock Par Value Authorized Shares Outstanding Liquidation Preference (Outstanding Shares) Series A $ 0.01 68,558,220 68,558,220 $ 19,774 Series A-1 0.01 24,760,915 24,760,915 49,522 Series B 0.01 35,775,880 35,775,880 21,581 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 50,000 444,760,848 214,637,925 $ 375,952 |
Schedule of Assumptions Used | The Company determined the fair value of the outstanding convertible Series F preferred stock warrants utilizing the following assumptions as of the following dates: June 30, 2018 December 31, 2017 Volatility 40% 40% Risk-free interest rate 2.83% 2.38% Remaining contractual term (in years) 8.66 9.16 Dividend yield 0% 0% The Company determined the fair value of the outstanding convertible Series E-1 preferred stock warrants utilizing the following assumptions as of the following dates: June 30, 2018 December 31, 2017 Volatility 40% 40% Risk-free interest rate 2.83% 2.38% Remaining contractual term (in years) 8.55 9.04 Dividend yield 0% 0% |
Schedule of Stockholders' Equity Note, Warrants or Rights | The combined activity of the Convertible Preferred Stock Warrant Liability for the six months ended June 30, 2018 is as follows (in thousands): Balance at January 1, 2018 $ 116,366 Warrants Vested 35,912 Change in Fair Value (8,602 ) Balance as of June 30, 2018 $ 143,676 |
Share Based Incentive Plan an36
Share Based Incentive Plan and Compensation (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summarized Option Activity under Option Plan | Stock option activity under the 2005 Plan and 2015 Plan is summarized for the six months ended June 30, 2018 below: Options Issued and Outstanding Weighted- Average Exercise Price Balance as of January 1, 2018 58,628,039 $ 0.25 Options issued 18,703,551 0.54 Options exercised – vested (82,792 ) 0.22 Options forfeited (3,879,249 ) 0.37 Balance as of June 30, 2018 73,369,549 $ 0.32 Options vested and expected to vest as of June 30, 2018 60,048,513 0.32 Options vested and exercisable at June 30, 2018 34,914,602 0.22 |
Additional Information Regarding Common Stock Options Outstanding | Additional information regarding common stock options outstanding as of June 30, 2018 is as follows: Options Outstanding Options Vested and Exercisable Range of Exercise Prices Number Outstanding Weighted – Avg. Remaining Life Weighted –Avg. Exercise Price Number Vested Weighted – Avg. Exercise Price $ 0.02 - 0.20 4,768,290 5.55 $ 0.11 4,768,290 $ 0.11 0.21 - 0.50 45,281,131 8.25 0.23 28,602,923 0.22 0.51 - 1.13 23,320,128 9.60 0.54 1,543,389 0.54 $ 0.02 - 1.13 73,369,549 8.51 $ 0.32 34,914,602 $ 0.22 |
Fair Value of Stock Option Awards | The fair value of PMI’s stock option awards granted during the three and six months ended June 30, 2018 and June 30, 2017 was estimated at the date of grant using the Black-Scholes model with the following average assumptions: Three Months Ended Six Months Ended June 30, 2018 2017 2018 2017 Volatility of common stock 44.43 % N/A 44.12 % 50.28 % Risk-free interest rate 2.85 % N/A 2.75 % 2.12 % Expected life (in years) 6.0 years N/A 6.0 years 5.7 years Dividend yield 0 % N/A 0 % 0 % |
Summarized Activities for RSU's | The following table summarizes the activities for PMI’s RSUs during the six months ended June 30, 2018 : Number of Shares Weighted-Average Grant Date Fair Value Unvested - January 1, 2018 1,399,180 $ 2.16 Granted 3,569,586 0.54 Vested — — Forfeited (100,500 ) 2.17 Unvested - June 30, 2018 4,868,266 $ 0.96 |
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 Prosper’s condensed consolidated statements of operations during the three and six months ended June 30, 2018 and June 30, 2017 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2018 2018 2017 2018 2017 Origination and servicing $ 241 $ 328 $ 456 $ 545 Sales and marketing 108 141 216 311 General and administrative 1,904 2,843 3,912 5,956 Total stock based compensation $ 2,253 $ 3,312 $ 4,584 $ 6,812 |
Restructuring (Tables)
Restructuring (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Restructuring and Related Activities [Abstract] | |
Summary of Activities Related to Prosper's Restructuring Plan | The following table summarizes the activities related to Prosper's restructuring plan (in thousands): Facilities Related Total Balance January 1, 2018 $ 3,244 $ 3,244 Adjustments to expense 591 591 Sublease cash receipts 316 316 Less: Cash paid (775 ) (775 ) Balance June 30, 2018 $ 3,376 $ 3,376 |
Consortium Purchase Agreement (
Consortium Purchase Agreement (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Consortium Purchase Agreement | The following represents the loans purchased and warrants vested under the Consortium Purchase Agreement: Loans Acquired (in thousands) Warrants Vested Total as of December 31, 2017 $ 1,826,527 75,186,002 Loans Purchased by the Consortium during the six months ended June 30, 2018 831,097 36,830,278 Total as of June 30, 2018 $ 2,657,624 112,016,280 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Lease Payments | The table below presents future minimum rental payments, net of minimum sublease rentals of $6.5 million , for the remaining terms of the operating leases (in thousands): Remainder of 2018 2,939 2019 6,026 2020 6,193 2021 6,170 2022 6,076 Thereafter 8,480 Total $ 35,884 |
Related Parties (Tables)
Related Parties (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Entity Information [Line Items] | |
Aggregate Amount of Notes Purchased and the Income Earned | The aggregate amount of the Notes and Borrower Loans purchased and the income earned by parties deemed to be affiliates and related parties of Prosper for the three and six months ended June 30, 2018 and June 30, 2017 , as well as the Notes and Borrower Loans outstanding as of June 30, 2018 and December 31, 2017 are summarized below (in thousands): Aggregate Amount of Interest Earned on Notes and Borrower Loans Related Party 2018 2017 2018 2017 Executive officers and management $ 9 $ 10 $ 1 $ 81 Directors (excluding executive officers and management) 208 174 22 20 Total $ 217 $ 184 $ 23 $ 101 Aggregate Amount of Notes and Borrower Loans Purchased Three Months Ended March 31, Interest Earned on Notes and Borrower Loans Three Months Ended March 31, Related Party 2018 2017 2018 2017 Executive officers and management $ 3 $ 5 $ — $ 35 Directors (excluding executive officers and management) 107 85 11 10 Total $ 110 $ 90 $ 11 $ 45 Notes balance as of Related Party June 30, 2018 December 31, 2017 Executive officers and management $ 17 $ 38 Directors (excluding executive officers and management) 560 553 $ 577 $ 591 |
Prosper Funding LLC | |
Entity Information [Line Items] | |
Aggregate Amount of Notes Purchased and the Income Earned | The aggregate amount of the Notes and Borrower Loans purchased and the income earned by parties deemed to be related parties of Prosper Funding as of June 30, 2018 and December 31, 2017 are summarized below (in thousands): Aggregate Amount of Notes and Borrower Loans Purchased Interest Earned on Notes and Borrower Loans Six Months Ended June 30, Six Months Ended June 30, Related Party 2018 2017 2018 2017 Executive officers and management $ 9 $ 10 $ 1 $ 81 Directors (excluding executive officers and management) — — — — Total $ 9 $ 10 $ 1 $ 81 Aggregate Amount of Notes and Borrower Loans Purchased Interest Earned on Notes and Borrower Loans Three Months Ended March 31, Three Months Ended March 31, Related Party 2018 2017 2018 2017 Executive officers and management $ 3 $ 5 $ — $ 35 Directors (excluding executive officers and management) — — — — Total $ 3 $ 5 $ — $ 35 Note and Borrower Loan Balance as of Related Party June 30, 2018 December 31, 2017 Executive officers and management $ 17 $ 38 Directors (excluding executive officers and management) — — $ 17 $ 38 |
Summary of Significant Accoun41
Summary of Significant Accounting Policies - Schedule of Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Entity Information [Line Items] | ||||
Cash and Cash Equivalents | $ 58,652 | $ 45,795 | $ 34,667 | $ 22,337 |
Restricted Cash | 134,552 | 152,668 | 179,331 | 163,907 |
Total Cash, Cash Equivalents and Restricted Cash shown in the consolidated statements of cash flows | 193,204 | 198,463 | 213,998 | 186,244 |
Prosper Funding LLC | ||||
Entity Information [Line Items] | ||||
Cash and Cash Equivalents | 10,892 | 8,223 | 12,384 | 6,929 |
Restricted Cash | 120,152 | 140,092 | 165,628 | 147,983 |
Total Cash, Cash Equivalents and Restricted Cash shown in the consolidated statements of cash flows | $ 131,044 | $ 148,315 | $ 178,012 | $ 154,912 |
Summary of Significant Accoun42
Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Thousands | 6 Months Ended | |||
Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 | |
Entity Information [Line Items] | ||||
Restricted Cash | $ 134,552 | $ 152,668 | $ 179,331 | $ 163,907 |
Non-cancelable operating lease commitments | $ 35,884 | |||
Minimum | ||||
Entity Information [Line Items] | ||||
Transaction fee percent | 1.00% | |||
Maximum | ||||
Entity Information [Line Items] | ||||
Transaction fee percent | 5.00% | |||
Prosper Funding LLC | ||||
Entity Information [Line Items] | ||||
Restricted Cash | $ 120,152 | $ 140,092 | $ 165,628 | $ 147,983 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |||||
Property and equipment | $ 48,138 | $ 48,138 | $ 45,713 | ||
Less accumulated depreciation and amortization | (32,057) | (32,057) | (27,577) | ||
Total property and equipment, net | 16,081 | 16,081 | 18,136 | ||
Depreciation expense | 5,334 | $ 6,270 | |||
Property Plant And Equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Depreciation and amortization expense | 2,400 | $ 2,700 | 5,100 | 5,200 | |
Computer equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment | 14,785 | 14,785 | 14,499 | ||
Internal-use software and website development costs | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment | 21,372 | 21,372 | 19,910 | ||
Capitalized internal-use software and website development costs | 1,400 | 1,000 | 2,500 | 2,100 | |
Office equipment and furniture | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment | 3,010 | 3,010 | 3,010 | ||
Leasehold improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment | 7,078 | 7,078 | 7,078 | ||
Assets not yet placed in service | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment | 1,893 | 1,893 | 1,216 | ||
Prosper Funding LLC | |||||
Property, Plant and Equipment [Line Items] | |||||
Less accumulated depreciation and amortization | (14,400) | (14,400) | (11,958) | ||
Total property and equipment, net | 6,972 | 6,972 | 7,953 | ||
Depreciation expense | 1,400 | $ 1,400 | 2,991 | $ 2,637 | |
Prosper Funding LLC | Internal-use software and website development costs | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment | $ 21,372 | $ 21,372 | $ 19,911 |
Borrower Loans, Loans Held fo44
Borrower Loans, Loans Held for Sale, and Notes Held at Fair Value - Aggregate Principal Balances Outstanding and Fair Values of Borrower Loans, Notes and Loans Held for Sale (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Borrower Loans, at Fair Value | $ 277,361 | $ 293,005 |
Notes, at Fair Value | (277,425) | (293,948) |
Loans Held for Sale, at Fair Value | 116,817 | 49 |
Prosper Funding LLC | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Borrower Loans, at Fair Value | 277,361 | 293,005 |
Notes, at Fair Value | (277,425) | (293,948) |
Loans Held for Sale, at Fair Value | 31 | 49 |
Notes | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Aggregate principal balance outstanding, Notes | (284,011) | (300,922) |
Fair value adjustments, Notes | 6,586 | 6,974 |
Notes, at Fair Value | (277,425) | (293,948) |
Notes | Prosper Funding LLC | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Aggregate principal balance outstanding, Notes | (284,011) | (300,922) |
Fair value adjustments, Notes | 6,586 | 6,974 |
Notes, at Fair Value | (277,425) | (293,948) |
Borrower Loans | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Aggregate principal balance outstanding, Borrower Loans | 280,852 | 296,668 |
Fair value adjustments, Borrower Loans and Loans Held for Sale | (3,491) | (3,663) |
Borrower Loans, at Fair Value | 277,361 | 293,005 |
Borrower Loans | Prosper Funding LLC | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Aggregate principal balance outstanding, Borrower Loans | 280,852 | 296,668 |
Fair value adjustments, Borrower Loans and Loans Held for Sale | (3,491) | (3,663) |
Borrower Loans, at Fair Value | 277,361 | 293,005 |
Loans Held for Sale | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Fair value adjustments, Borrower Loans and Loans Held for Sale | (211) | (10) |
Aggregate principal balance outstanding, Loans Held for Sale | 117,028 | 59 |
Loans Held for Sale, at Fair Value | 116,817 | 49 |
Loans Held for Sale | Prosper Funding LLC | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Fair value adjustments, Borrower Loans and Loans Held for Sale | (13) | (10) |
Aggregate principal balance outstanding, Loans Held for Sale | 44 | 59 |
Loans Held for Sale, at Fair Value | $ 31 | $ 49 |
Borrower Loans, Loans Held fo45
Borrower Loans, Loans Held for Sale, and Notes Held at Fair Value - Additional Information (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Loss related to credit risks on borrower loans | $ 0.6 | $ 1.2 | |
Minimum number of days for which loans originated were delinquent | 90 days | 90 days | |
Aggregate principal amount of loans originated | $ 2.6 | $ 3.5 | |
Fair value of loans originated | $ 1.1 | 1.3 | |
Non accrual status past due date | 120 days | ||
Borrower loans receivable | $ 0.3 | $ 0.3 | |
Prosper Funding LLC | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Loss related to credit risks on borrower loans | $ 0.6 | ||
Minimum number of days for which loans originated were delinquent | 90 days | 90 days | |
Aggregate principal amount of loans originated | $ 2.6 | $ 3.5 | |
Fair value of loans originated | $ 1.1 | 1.3 | |
Non accrual status past due date | 120 days | ||
Borrower loans receivable | $ 0.3 | $ 0.3 | |
Loans Held For Sale Borrower Loans And Underlying Notes | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Fixed interest rate, minimum | 5.31% | 5.31% | |
Fixed interest rate, maximum | 32.32% | 32.32% | |
Loans Held For Sale Borrower Loans And Underlying Notes | Prosper Funding LLC | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Fixed interest rate, minimum | 5.31% | 5.31% | |
Fixed interest rate, maximum | 32.32% | 32.32% | |
Minimum | Loans Held For Sale Borrower Loans And Underlying Notes | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Maturity, in months | 36 months | 36 months | |
Minimum | Loans Held For Sale Borrower Loans And Underlying Notes | Prosper Funding LLC | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Maturity, in months | 36 months | 36 months | |
Maximum | Loans Held For Sale Borrower Loans And Underlying Notes | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Maturity, in months | 60 months | 60 months | |
Maximum | Loans Held For Sale Borrower Loans And Underlying Notes | Prosper Funding LLC | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Maturity, in months | 60 months | 60 months |
Loan Servicing Assets and Lia46
Loan Servicing Assets and Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Servicing Assets And Liabilities Fair Value [Line Items] | |||||
Gain (loss) on sale of borrower loans | $ 4,163 | $ 3,803 | $ 7,512 | $ 3,485 | |
Fair value of warrants vested on sale of borrower loans | 20,633 | 16,887 | 35,912 | 20,194 | |
Prosper Funding LLC | |||||
Servicing Assets And Liabilities Fair Value [Line Items] | |||||
Gain (loss) on sale of borrower loans | (16,181) | (13,084) | (27,754) | (16,709) | |
Borrower Loans | |||||
Servicing Assets And Liabilities Fair Value [Line Items] | |||||
Outstanding principle | 3,900,000 | $ 3,900,000 | $ 3,700,000 | ||
Fixed interest rate, minimum | 5.31% | 5.31% | |||
Fixed interest rate, maximum | 35.52% | 35.52% | |||
Contractually specified servicing fees, late charges and ancillary fees | $ 21,600 | 18,200 | |||
Borrower Loans | Prosper Funding LLC | |||||
Servicing Assets And Liabilities Fair Value [Line Items] | |||||
Outstanding principle | 3,900,000 | $ 3,900,000 | $ 3,700,000 | ||
Fixed interest rate, minimum | 5.31% | 5.31% | |||
Fixed interest rate, maximum | 35.52% | 35.52% | |||
Contractually specified servicing fees, late charges and ancillary fees | $ 11,200 | 9,200 | $ 21,800 | 17,900 | |
Minimum | Borrower Loans | |||||
Servicing Assets And Liabilities Fair Value [Line Items] | |||||
Maturity, in months | 36 months | 36 months | |||
Minimum | Borrower Loans | Prosper Funding LLC | |||||
Servicing Assets And Liabilities Fair Value [Line Items] | |||||
Maturity, in months | 36 months | 36 months | |||
Maximum | Borrower Loans | |||||
Servicing Assets And Liabilities Fair Value [Line Items] | |||||
Maturity, in months | 60 months | 60 months | |||
Maximum | Borrower Loans | Prosper Funding LLC | |||||
Servicing Assets And Liabilities Fair Value [Line Items] | |||||
Maturity, in months | 60 months | 60 months | |||
Borrower Loans | |||||
Servicing Assets And Liabilities Fair Value [Line Items] | |||||
Gain (loss) on sale of borrower loans | $ 3,800 | $ 3,500 |
Available for Sale Investment47
Available for Sale Investments, at Fair Value - Schedule of Amortized Cost, Gross Unrealized Gains and Losses and Fair Value of Available for Sale Investments (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Schedule Of Available For Sale Securities [Line Items] | ||
Fair Value | $ 34,841 | $ 53,147 |
Fixed Maturity Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 34,900 | 53,221 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (59) | (74) |
Fair Value | 34,841 | 53,147 |
Treasury Bills | Fixed Maturity Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 20,668 | 34,014 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (23) | (36) |
Fair Value | 20,645 | 33,978 |
US Treasury securities | Fixed Maturity Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 14,232 | 19,207 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (36) | (38) |
Fair Value | $ 14,196 | $ 19,169 |
Available for Sale Investment48
Available for Sale Investments, at Fair Value - Summary of Available for Sale Investments of Continuous Unrealized Loss (Details) - Fixed Maturity Securities - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Schedule Of Available For Sale Securities [Line Items] | ||
Fair value, less than 12 months | $ 34,841 | $ 53,147 |
Unrealized losses, less than 12 months | (59) | (74) |
Fair value, 12 months or longer | 0 | 0 |
Unrealized losses, 12 months or longer | 0 | 0 |
Fair Value | 34,841 | 53,147 |
Unrealized Losses | (59) | (74) |
Treasury Bills | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Fair value, less than 12 months | 20,645 | 33,978 |
Unrealized losses, less than 12 months | (23) | (36) |
Fair value, 12 months or longer | 0 | 0 |
Unrealized losses, 12 months or longer | 0 | 0 |
Fair Value | 20,645 | 33,978 |
Unrealized Losses | (23) | (36) |
US Treasury securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Fair value, less than 12 months | 14,196 | 19,169 |
Unrealized losses, less than 12 months | (36) | (38) |
Fair value, 12 months or longer | 0 | 0 |
Unrealized losses, 12 months or longer | 0 | 0 |
Fair Value | 14,196 | 19,169 |
Unrealized Losses | $ (36) | $ (38) |
Available for Sale Investment49
Available for Sale Investments, at Fair Value - Additional Information (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | ||
Impairment charges recognized during period | $ 0 | |
Proceeds from investments | 0 | $ 16,163,000 |
Available-for-sale investments, realized gains | $ 0 |
Available for Sale Investment50
Available for Sale Investments, at Fair Value - Schedule of Maturities of Available for Sale Investments (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Schedule Of Available For Sale Securities [Line Items] | ||
Total | $ 34,841 | $ 53,147 |
Fixed Maturity Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Within 1 year | 34,841 | 48,925 |
After 1 year through 5 years | 0 | 4,222 |
After 5 years to 10 years | 0 | 0 |
After 10 years | 0 | 0 |
Total | 34,841 | 53,147 |
Amortized cost within 1 year | 34,900 | 48,992 |
Amortized cost after 1 year through 5 years | 0 | 4,229 |
Amortized cost after 5 years to 10 years | 0 | 0 |
Amortized cost after 10 years | 0 | 0 |
Amortized Cost | 34,900 | 53,221 |
Treasury Bills | Fixed Maturity Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Within 1 year | 20,645 | 33,978 |
After 1 year through 5 years | 0 | 0 |
After 5 years to 10 years | 0 | 0 |
After 10 years | 0 | 0 |
Total | 20,645 | 33,978 |
Amortized Cost | 20,668 | 34,014 |
US Treasury securities | Fixed Maturity Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Within 1 year | 14,196 | 14,947 |
After 1 year through 5 years | 0 | 4,222 |
After 5 years to 10 years | 0 | 0 |
After 10 years | 0 | 0 |
Total | 14,196 | 19,169 |
Amortized Cost | $ 14,232 | $ 19,207 |
Fair Value of Assets and Liab51
Fair Value of Assets and Liabilities - Fair Value Hierarchy for Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Assets: | ||
Borrower Loans | $ 277,361 | $ 293,005 |
Loans Held for Sale | 116,817 | 49 |
Available for Sale Investments, at Fair Value | 34,841 | 53,147 |
Servicing Assets | 15,644 | 14,711 |
Total Assets | 444,663 | 360,912 |
Liabilities: | ||
Notes | 277,425 | 293,948 |
Servicing Liabilities | 28 | 59 |
Convertible Preferred Stock Warrant Liability | 143,676 | 116,366 |
Loan Trailing Fee Liability | 3,078 | 2,595 |
Total Liabilities | 424,207 | 412,968 |
Prosper Funding LLC | ||
Assets: | ||
Borrower Loans | 277,361 | 293,005 |
Loans Held for Sale | 31 | 49 |
Servicing Assets | 16,162 | 14,598 |
Total Assets | 293,554 | 307,652 |
Liabilities: | ||
Notes | 277,425 | 293,948 |
Servicing Liabilities | 28 | 59 |
Loan Trailing Fee Liability | 3,078 | 2,595 |
Total Liabilities | 280,531 | 296,602 |
Level 1 Inputs | ||
Assets: | ||
Borrower Loans | 0 | |
Loans Held for Sale | 0 | |
Available for Sale Investments, at Fair Value | 0 | |
Servicing Assets | 0 | |
Total Assets | 0 | 0 |
Liabilities: | ||
Notes | 0 | |
Servicing Liabilities | 0 | |
Convertible Preferred Stock Warrant Liability | 0 | |
Loan Trailing Fee Liability | 0 | |
Total Liabilities | 0 | 0 |
Level 1 Inputs | Prosper Funding LLC | ||
Assets: | ||
Borrower Loans | 0 | 0 |
Loans Held for Sale | 0 | 0 |
Servicing Assets | 0 | 0 |
Total Assets | 0 | 0 |
Liabilities: | ||
Notes | 0 | 0 |
Servicing Liabilities | 0 | 0 |
Loan Trailing Fee Liability | 0 | 0 |
Total Liabilities | 0 | 0 |
Level 2 Inputs | ||
Assets: | ||
Borrower Loans | 0 | |
Loans Held for Sale | 0 | |
Available for Sale Investments, at Fair Value | 34,841 | 53,147 |
Servicing Assets | 0 | |
Total Assets | 34,841 | 53,147 |
Liabilities: | ||
Notes | 0 | |
Servicing Liabilities | 0 | |
Convertible Preferred Stock Warrant Liability | 0 | |
Loan Trailing Fee Liability | 0 | |
Total Liabilities | 0 | 0 |
Level 2 Inputs | Prosper Funding LLC | ||
Assets: | ||
Borrower Loans | 0 | 0 |
Loans Held for Sale | 0 | 0 |
Servicing Assets | 0 | 0 |
Total Assets | 0 | 0 |
Liabilities: | ||
Notes | 0 | 0 |
Servicing Liabilities | 0 | 0 |
Loan Trailing Fee Liability | 0 | 0 |
Total Liabilities | 0 | 0 |
Level 3 Inputs | ||
Assets: | ||
Borrower Loans | 277,361 | 293,005 |
Loans Held for Sale | 116,817 | 49 |
Available for Sale Investments, at Fair Value | 0 | 0 |
Servicing Assets | 15,644 | 14,711 |
Total Assets | 409,822 | 307,765 |
Liabilities: | ||
Notes | 277,425 | 293,948 |
Servicing Liabilities | 28 | 59 |
Convertible Preferred Stock Warrant Liability | 143,676 | 116,366 |
Loan Trailing Fee Liability | 3,078 | 2,595 |
Total Liabilities | 424,207 | 412,968 |
Level 3 Inputs | Prosper Funding LLC | ||
Assets: | ||
Borrower Loans | 277,361 | 293,005 |
Loans Held for Sale | 31 | 49 |
Servicing Assets | 16,162 | 14,598 |
Total Assets | 293,554 | 307,652 |
Liabilities: | ||
Notes | 277,425 | 293,948 |
Servicing Liabilities | 28 | 59 |
Loan Trailing Fee Liability | 3,078 | 2,595 |
Total Liabilities | $ 280,531 | $ 296,602 |
Fair Value of Assets and Liab52
Fair Value of Assets and Liabilities - Borrower Loans, Loans Held For Sale and Notes - Quantitative Information about the Significant Unobservable Inputs (Details) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Minimum | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Discount rate | 4.40% | 4.00% |
Default rate | 2.00% | 2.00% |
Minimum | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Discount rate | 4.40% | 4.00% |
Default rate | 2.00% | 2.00% |
Maximum | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Discount rate | 13.90% | 14.40% |
Default rate | 15.60% | 15.40% |
Maximum | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Discount rate | 13.90% | 14.40% |
Default rate | 15.60% | 15.40% |
Fair Value of Assets and Liab53
Fair Value of Assets and Liabilities - Servicing Rights - Quantitative Information about the Significant Unobservable Inputs (Details) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Servicing Liabilities at Fair Value [Line Items] | ||
Market servicing rate | 0.625% | 0.625% |
Prosper Funding LLC | ||
Servicing Liabilities at Fair Value [Line Items] | ||
Market servicing rate | 0.625% | 0.625% |
Minimum | ||
Servicing Liabilities at Fair Value [Line Items] | ||
Discount rate | 15.00% | 15.00% |
Default rate | 1.60% | 1.50% |
Prepayment rate | 15.20% | 13.50% |
Minimum | Prosper Funding LLC | ||
Servicing Liabilities at Fair Value [Line Items] | ||
Discount rate | 15.00% | 15.00% |
Default rate | 1.60% | 1.50% |
Prepayment rate | 15.20% | 13.50% |
Maximum | ||
Servicing Liabilities at Fair Value [Line Items] | ||
Discount rate | 25.00% | 25.00% |
Default rate | 16.50% | 16.10% |
Prepayment rate | 32.90% | 30.20% |
Maximum | Prosper Funding LLC | ||
Servicing Liabilities at Fair Value [Line Items] | ||
Discount rate | 25.00% | 25.00% |
Default rate | 16.50% | 16.10% |
Prepayment rate | 32.90% | 30.20% |
Fair Value of Assets and Liab54
Fair Value of Assets and Liabilities - Loan Trailing Fee Liability (Details) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 4.40% | 4.00% |
Default rate | 2.00% | 2.00% |
Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 13.90% | 14.40% |
Default rate | 15.60% | 15.40% |
Prosper Funding LLC | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 4.40% | 4.00% |
Default rate | 2.00% | 2.00% |
Prosper Funding LLC | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 13.90% | 14.40% |
Default rate | 15.60% | 15.40% |
Obligations | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 15.00% | 15.00% |
Default rate | 1.60% | 1.50% |
Prepayment rate | 15.20% | 13.50% |
Obligations | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 25.00% | 25.00% |
Default rate | 16.50% | 16.10% |
Prepayment rate | 32.90% | 30.20% |
Obligations | Prosper Funding LLC | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 15.00% | 15.00% |
Default rate | 1.60% | 1.50% |
Prepayment rate | 15.20% | 13.50% |
Obligations | Prosper Funding LLC | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 25.00% | 25.00% |
Default rate | 16.50% | 16.10% |
Prepayment rate | 32.90% | 30.20% |
Fair Value of Assets and Liab55
Fair Value of Assets and Liabilities - Summary of Level 3 Borrower Loans, Loans Held for Sale and Notes, Measured at Fair Value on a Recurring Basis (Details) - Recurring - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Fair Value Measurement With Unobservable Inputs Reconciliations Recurring Basis Asset And Liability [Roll Forward] | ||||
Beginning balance, Total | $ 83,292 | $ 701 | $ (894) | $ 15 |
Purchase of Borrower Loans/Issuance of Notes | 729,232 | 722,397 | 1,324,482 | 1,246,260 |
Principal repayments | (9,983) | 633 | (11,687) | 2,740 |
Borrower Loans sold to third parties | (684,497) | (722,698) | (1,195,667) | (1,248,306) |
Other changes | 139 | (146) | 1,091 | 272 |
Change in fair value | (1,430) | 70 | (572) | (24) |
Ending balance, Total | 116,753 | 957 | 116,753 | 957 |
Prosper Funding LLC | ||||
Fair Value Measurement With Unobservable Inputs Reconciliations Recurring Basis Asset And Liability [Roll Forward] | ||||
Beginning balance, Total | 530 | 701 | (894) | 15 |
Originations | 729,232 | 722,397 | 1,324,482 | 1,246,260 |
Principal repayments | 427 | 633 | 2,564 | 2,740 |
Borrower Loans sold to third parties | (729,851) | (722,698) | (1,326,116) | (1,248,306) |
Other changes | (116) | (146) | 295 | 272 |
Change in fair value | (255) | 70 | (364) | (24) |
Ending balance, Total | (33) | 957 | (33) | 957 |
Notes | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance, Liabilities | (285,095) | (316,944) | (293,948) | (316,236) |
Purchase of Borrower Loans/Issuance of Notes | (44,468) | (49,692) | (90,693) | (106,506) |
Principal repayments | 44,423 | 48,695 | 91,525 | 100,274 |
Borrower Loans sold to third parties | 0 | 0 | 0 | 0 |
Other changes | 86 | (156) | 633 | 266 |
Change in fair value | 7,629 | 6,687 | 15,058 | 10,792 |
Ending balance, Liabilities | (277,425) | (311,410) | (277,425) | (311,410) |
Notes | Prosper Funding LLC | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance, Liabilities | (285,095) | (316,944) | (293,948) | (316,236) |
Originations | (44,468) | (49,692) | (90,693) | (106,506) |
Principal repayments | 44,423 | 48,695 | 91,525 | 100,274 |
Borrower Loans sold to third parties | 0 | 0 | 0 | 0 |
Other changes | 86 | (156) | 633 | 266 |
Change in fair value | 7,629 | 6,687 | 15,058 | 10,792 |
Ending balance, Liabilities | (277,425) | (311,410) | (277,425) | (311,410) |
Borrower Loans | ||||
Changes in Level 3 assets measured at fair value on a recurring basis [Abstract] | ||||
Beginning balance, Assets | 285,584 | 317,536 | 293,005 | 315,627 |
Purchase of Borrower Loans/Issuance of Notes | 44,799 | 50,260 | 91,075 | 106,940 |
Principal repayments | (43,990) | (48,048) | (88,947) | (97,492) |
Borrower Loans sold to third parties | (950) | (869) | (2,016) | (1,990) |
Other changes | (202) | 10 | (338) | 9 |
Change in fair value | (7,880) | (6,617) | (15,418) | (10,822) |
Ending balance, Assets | 277,361 | 312,272 | 277,361 | 312,272 |
Borrower Loans | Prosper Funding LLC | ||||
Changes in Level 3 assets measured at fair value on a recurring basis [Abstract] | ||||
Beginning balance, Assets | 285,584 | 317,536 | 293,005 | 315,627 |
Originations | 44,799 | 50,260 | 91,075 | 106,940 |
Principal repayments | (43,990) | (48,048) | (88,947) | (97,492) |
Borrower Loans sold to third parties | (950) | (869) | (2,016) | (1,990) |
Other changes | (202) | 10 | (338) | 9 |
Change in fair value | (7,880) | (6,617) | (15,418) | (10,822) |
Ending balance, Assets | 277,361 | 312,272 | 277,361 | 312,272 |
Loans Held for Sale | ||||
Changes in Level 3 assets measured at fair value on a recurring basis [Abstract] | ||||
Beginning balance, Assets | 82,803 | 109 | 49 | 624 |
Purchase of Borrower Loans/Issuance of Notes | 728,901 | 721,829 | 1,324,100 | 1,245,826 |
Principal repayments | (10,416) | (14) | (14,265) | (42) |
Borrower Loans sold to third parties | (683,547) | (721,829) | (1,193,651) | (1,246,316) |
Other changes | 255 | 0 | 796 | (3) |
Change in fair value | (1,179) | 0 | (212) | 6 |
Ending balance, Assets | 116,817 | 95 | 116,817 | 95 |
Loans Held for Sale | Prosper Funding LLC | ||||
Changes in Level 3 assets measured at fair value on a recurring basis [Abstract] | ||||
Beginning balance, Assets | 41 | 109 | 49 | 624 |
Originations | 728,901 | 721,829 | 1,324,100 | 1,245,826 |
Principal repayments | (6) | (14) | (14) | (42) |
Borrower Loans sold to third parties | (728,901) | (721,829) | (1,324,100) | (1,246,316) |
Other changes | 0 | 0 | 0 | (3) |
Change in fair value | (4) | 0 | (4) | 6 |
Ending balance, Assets | $ 31 | $ 95 | $ 31 | $ 95 |
Fair Value of Assets and Liab56
Fair Value of Assets and Liabilities - Schedule of Servicing Assets and Liabilities, Warrant Liability and Loan Trailing (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Servicing Asset at Amortized Cost, Balance [Roll Forward] | ||||
Servicing Asset at Fair Value, Beginning Balance | $ 14,711 | |||
Servicing Asset at Fair Value, Ending Balance | $ 15,644 | 15,644 | ||
Servicing Liability at Amortized Cost [Roll Forward] | ||||
Servicing Liability at Fair Value, Beginning Balance | 59 | |||
Servicing Liability at Fair Value, Ending Balance | 28 | 28 | ||
Prosper Funding LLC | ||||
Servicing Asset at Amortized Cost, Balance [Roll Forward] | ||||
Servicing Asset at Fair Value, Beginning Balance | 14,598 | |||
Servicing Asset at Fair Value, Ending Balance | 16,162 | 16,162 | ||
Servicing Liability at Amortized Cost [Roll Forward] | ||||
Servicing Liability at Fair Value, Beginning Balance | 59 | |||
Servicing Liability at Fair Value, Ending Balance | 28 | 28 | ||
Servicing Assets | ||||
Servicing Asset at Amortized Cost, Balance [Roll Forward] | ||||
Servicing Asset at Fair Value, Beginning Balance | 14,754 | $ 12,436 | 14,711 | $ 12,786 |
Additions | 4,163 | 3,768 | 7,502 | 6,532 |
Less: Changes in fair value | 3,273 | 2,715 | (6,569) | (5,829) |
Servicing Asset at Fair Value, Ending Balance | 15,644 | 13,489 | 15,644 | 13,489 |
Servicing Assets | Prosper Funding LLC | ||||
Servicing Asset at Amortized Cost, Balance [Roll Forward] | ||||
Servicing Asset at Fair Value, Beginning Balance | 15,023 | 12,190 | 14,598 | 12,461 |
Additions | 4,452 | 3,768 | 8,147 | 6,532 |
Less: Changes in fair value | (3,313) | (2,661) | (6,583) | (5,696) |
Servicing Asset at Fair Value, Ending Balance | 16,162 | 13,297 | 16,162 | 13,297 |
Servicing Liabilities | ||||
Servicing Liability at Amortized Cost [Roll Forward] | ||||
Servicing Liability at Fair Value, Beginning Balance | 41 | 147 | 59 | 198 |
Additions | 0 | 0 | 0 | 0 |
Less: Changes in fair value | 13 | 36 | (31) | (87) |
Servicing Liability at Fair Value, Ending Balance | 28 | 111 | 28 | 111 |
Servicing Liabilities | Prosper Funding LLC | ||||
Servicing Liability at Amortized Cost [Roll Forward] | ||||
Servicing Liability at Fair Value, Beginning Balance | 41 | 147 | 59 | 198 |
Additions | 0 | 0 | 0 | 0 |
Less: Changes in fair value | (13) | (36) | (31) | (87) |
Servicing Liability at Fair Value, Ending Balance | 28 | 111 | 28 | 111 |
Preferred Stock Warrant | ||||
Servicing Liability at Amortized Cost [Roll Forward] | ||||
Beginning balance | 127,041 | 30,811 | 116,366 | 0 |
Issuances | 20,633 | 16,887 | 35,912 | 47,297 |
Change in fair value | (3,998) | 22,416 | (8,602) | 22,817 |
Ending balance | 143,676 | $ 70,114 | 143,676 | $ 70,114 |
Trailing Fee | ||||
Servicing Liability at Amortized Cost [Roll Forward] | ||||
Beginning balance | 2,595 | |||
Issuances | 1,529 | |||
Cash payment of Loan Trailing Fee | (1,206) | |||
Change in fair value | 160 | |||
Ending balance | 3,078 | 3,078 | ||
Trailing Fee | Prosper Funding LLC | ||||
Servicing Liability at Amortized Cost [Roll Forward] | ||||
Beginning balance | 2,595 | |||
Issuances | 1,529 | |||
Cash payment of Loan Trailing Fee | 1,206 | |||
Change in fair value | 160 | |||
Ending balance | 3,078 | 3,078 | ||
Level 3 Inputs | ||||
Servicing Asset at Amortized Cost, Balance [Roll Forward] | ||||
Servicing Asset at Fair Value, Beginning Balance | 14,711 | |||
Servicing Asset at Fair Value, Ending Balance | 15,644 | 15,644 | ||
Servicing Liability at Amortized Cost [Roll Forward] | ||||
Servicing Liability at Fair Value, Beginning Balance | 59 | |||
Servicing Liability at Fair Value, Ending Balance | 28 | 28 | ||
Level 3 Inputs | Prosper Funding LLC | ||||
Servicing Asset at Amortized Cost, Balance [Roll Forward] | ||||
Servicing Asset at Fair Value, Beginning Balance | 14,598 | |||
Servicing Asset at Fair Value, Ending Balance | 16,162 | 16,162 | ||
Servicing Liability at Amortized Cost [Roll Forward] | ||||
Servicing Liability at Fair Value, Beginning Balance | 59 | |||
Servicing Liability at Fair Value, Ending Balance | $ 28 | $ 28 |
Fair Value of Assets and Liab57
Fair Value of Assets and Liabilities - Fair Value Assumptions for Borrower Loans, Loans Held for Sale and Notes (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Dec. 31, 2017 | |
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes at Fair Value | $ 277,425 | $ 293,948 |
Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes at Fair Value | 277,425 | $ 293,948 |
Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes at Fair Value | 277,425 | |
Notes | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes at Fair Value | 277,425 | |
Borrower Loans and Loans Held for Sale | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes at Fair Value | 394,178 | |
Borrower Loans and Loans Held for Sale | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes at Fair Value | $ 277,392 | |
Discount rate assumption | Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Discount rate | 7.52% | |
Discount rate assumption | Notes | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Discount rate | 7.52% | |
Discount rate assumption | Borrower Loans and Loans Held for Sale | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Discount rate | 7.52% | |
Discount rate assumption | Borrower Loans and Loans Held for Sale | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Discount rate | 7.52% | |
Discount rate assumption | 100 basis point increase | Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | $ 274,660 | |
Discount rate assumption | 100 basis point increase | Notes | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 274,660 | |
Discount rate assumption | 100 basis point increase | Borrower Loans and Loans Held for Sale | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 390,255 | |
Discount rate assumption | 100 basis point increase | Borrower Loans and Loans Held for Sale | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 274,662 | |
Discount rate assumption | 200 basis point increase | Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 271,964 | |
Discount rate assumption | 200 basis point increase | Notes | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 271,964 | |
Discount rate assumption | 200 basis point increase | Borrower Loans and Loans Held for Sale | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 386,431 | |
Discount rate assumption | 200 basis point increase | Borrower Loans and Loans Held for Sale | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 271,970 | |
Discount rate assumption | 100 basis point decrease | Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 280,262 | |
Discount rate assumption | 100 basis point decrease | Notes | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 280,262 | |
Discount rate assumption | 100 basis point decrease | Borrower Loans and Loans Held for Sale | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 398,202 | |
Discount rate assumption | 100 basis point decrease | Borrower Loans and Loans Held for Sale | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 280,255 | |
Discount rate assumption | 200 basis point decrease | Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 283,173 | |
Discount rate assumption | 200 basis point decrease | Notes | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 283,173 | |
Discount rate assumption | 200 basis point decrease | Borrower Loans and Loans Held for Sale | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 402,333 | |
Discount rate assumption | 200 basis point decrease | Borrower Loans and Loans Held for Sale | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | $ 283,162 | |
Default rate assumption | Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Default rate | 13.11% | |
Default rate assumption | Notes | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Default rate | 13.11% | |
Default rate assumption | Borrower Loans and Loans Held for Sale | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Default rate | 13.11% | |
Default rate assumption | Borrower Loans and Loans Held for Sale | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Default rate | 13.11% | |
Default rate assumption | 100 basis point increase | Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | $ 273,967 | |
Default rate assumption | 100 basis point increase | Notes | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 273,967 | |
Default rate assumption | 100 basis point increase | Borrower Loans and Loans Held for Sale | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 389,288 | |
Default rate assumption | 100 basis point increase | Borrower Loans and Loans Held for Sale | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 273,981 | |
Default rate assumption | 200 basis point increase | Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 270,612 | |
Default rate assumption | 200 basis point increase | Notes | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 270,612 | |
Default rate assumption | 200 basis point increase | Borrower Loans and Loans Held for Sale | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 384,542 | |
Default rate assumption | 200 basis point increase | Borrower Loans and Loans Held for Sale | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 270,641 | |
Default rate assumption | 100 basis point decrease | Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 280,911 | |
Default rate assumption | 100 basis point decrease | Notes | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 280,911 | |
Default rate assumption | 100 basis point decrease | Borrower Loans and Loans Held for Sale | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 399,107 | |
Default rate assumption | 100 basis point decrease | Borrower Loans and Loans Held for Sale | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 280,892 | |
Default rate assumption | 200 basis point decrease | Notes | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 284,428 | |
Default rate assumption | 200 basis point decrease | Notes | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Notes | 284,428 | |
Default rate assumption | 200 basis point decrease | Borrower Loans and Loans Held for Sale | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | 404,079 | |
Default rate assumption | 200 basis point decrease | Borrower Loans and Loans Held for Sale | Prosper Funding LLC | ||
Fair Value Inputs Assets Quantitative Information [Line Items] | ||
Borrower loans | $ 284,391 |
Fair Value of Assets and Liab58
Fair Value of Assets and Liabilities - Schedule of Prosper's and Prosper Funding's Estimated Fair Value of Servicing Assets and Liabilities (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2018 | Dec. 31, 2017 | Mar. 31, 2018 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | |
Servicing Assets And Liabilities Fair Value [Line Items] | ||||||
Servicing Assets | $ 15,644 | $ 14,711 | ||||
Servicing Liabilities | $ 28 | $ 59 | ||||
Market servicing rate assumptions | 0.625% | 0.625% | ||||
Prosper Funding LLC | ||||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||||
Servicing Assets | $ 16,162 | $ 14,598 | ||||
Servicing Liabilities | $ 28 | $ 59 | ||||
Market servicing rate assumptions | 0.625% | 0.625% | ||||
Servicing Assets | ||||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||||
Servicing Assets | $ 15,644 | $ 14,711 | $ 14,754 | $ 13,489 | $ 12,436 | $ 12,786 |
Market servicing rate assumptions | 0.625% | |||||
Resulting fair value from: | ||||||
Servicing Asset, Market servicing rate increase to 0.65% | $ 14,691 | |||||
Servicing Asset, Market servicing rate decrease to 0.60% | $ 16,634 | |||||
Weighted average prepayment assumptions | 19.98% | |||||
Resulting fair value from: | ||||||
Weighted average default assumptions | 12.66% | |||||
Servicing Assets | Prosper Funding LLC | ||||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||||
Servicing Assets | $ 16,162 | 14,598 | 15,023 | 13,297 | 12,190 | 12,461 |
Market servicing rate assumptions | 0.625% | |||||
Resulting fair value from: | ||||||
Servicing Asset, Market servicing rate increase to 0.65% | $ 15,160 | |||||
Servicing Asset, Market servicing rate decrease to 0.60% | $ 17,165 | |||||
Weighted average prepayment assumptions | 19.98% | |||||
Resulting fair value from: | ||||||
Weighted average default assumptions | 12.66% | |||||
Servicing Liabilities | ||||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||||
Servicing Liabilities | $ 28 | 59 | 41 | 111 | 147 | 198 |
Market servicing rate assumptions | 0.625% | |||||
Resulting fair value from: | ||||||
Servicing Liabilities, Market servicing rate increase to 0.65% | $ 31 | |||||
Servicing Liabilities, Market servicing rate decrease to 0.60% | $ 25 | |||||
Weighted average prepayment assumptions | 19.98% | |||||
Resulting fair value from: | ||||||
Weighted average default assumptions | 12.66% | |||||
Servicing Liabilities | Prosper Funding LLC | ||||||
Servicing Assets And Liabilities Fair Value [Line Items] | ||||||
Servicing Liabilities | $ 28 | $ 59 | $ 41 | $ 111 | $ 147 | $ 198 |
Market servicing rate assumptions | 0.625% | |||||
Resulting fair value from: | ||||||
Servicing Liabilities, Market servicing rate increase to 0.65% | $ 31 | |||||
Servicing Liabilities, Market servicing rate decrease to 0.60% | $ 25 | |||||
Weighted average prepayment assumptions | 19.98% | |||||
Resulting fair value from: | ||||||
Weighted average default assumptions | 12.66% | |||||
Prepayment rate assumption | Servicing Assets | Applying a 1.1 multiplier to prepayment rate | ||||||
Resulting fair value from: | ||||||
Servicing Asset, Applying a 1.1 multiplier to prepayment rate | $ 15,471 | |||||
Prepayment rate assumption | Servicing Assets | Applying a 1.1 multiplier to prepayment rate | Prosper Funding LLC | ||||||
Resulting fair value from: | ||||||
Servicing Asset, Applying a 1.1 multiplier to prepayment rate | 15,964 | |||||
Prepayment rate assumption | Servicing Assets | Applying a 0.9 multiplier to prepayment rate | ||||||
Resulting fair value from: | ||||||
Servicing Asset, Applying a 0.9 multiplier to prepayment rate | 15,857 | |||||
Prepayment rate assumption | Servicing Assets | Applying a 0.9 multiplier to prepayment rate | Prosper Funding LLC | ||||||
Resulting fair value from: | ||||||
Servicing Asset, Applying a 0.9 multiplier to prepayment rate | 16,363 | |||||
Prepayment rate assumption | Servicing Liabilities | Applying a 1.1 multiplier to prepayment rate | ||||||
Resulting fair value from: | ||||||
Servicing Liabilities, Applying a 1.1 multiplier to prepayment rate | 28 | |||||
Prepayment rate assumption | Servicing Liabilities | Applying a 1.1 multiplier to prepayment rate | Prosper Funding LLC | ||||||
Resulting fair value from: | ||||||
Servicing Liabilities, Applying a 1.1 multiplier to prepayment rate | 28 | |||||
Prepayment rate assumption | Servicing Liabilities | Applying a 0.9 multiplier to prepayment rate | ||||||
Resulting fair value from: | ||||||
Servicing Liabilities, Applying a 0.9 multiplier to prepayment rate | 29 | |||||
Prepayment rate assumption | Servicing Liabilities | Applying a 0.9 multiplier to prepayment rate | Prosper Funding LLC | ||||||
Resulting fair value from: | ||||||
Servicing Liabilities, Applying a 0.9 multiplier to prepayment rate | 29 | |||||
Default rate assumption | Servicing Assets | Applying a 1.1 multiplier to default rate | ||||||
Applying Multiplier, Default Rate [Abstract] | ||||||
Servicing Asset, Applying a 1.1 multiplier to default rate | 15,473 | |||||
Default rate assumption | Servicing Assets | Applying a 1.1 multiplier to default rate | Prosper Funding LLC | ||||||
Applying Multiplier, Default Rate [Abstract] | ||||||
Servicing Asset, Applying a 1.1 multiplier to default rate | 15,967 | |||||
Default rate assumption | Servicing Assets | Applying a 0.9 multiplier to default rate | ||||||
Applying Multiplier, Default Rate [Abstract] | ||||||
Servicing Asset, Applying a 0.9 multiplier to default rate | 15,857 | |||||
Default rate assumption | Servicing Assets | Applying a 0.9 multiplier to default rate | Prosper Funding LLC | ||||||
Applying Multiplier, Default Rate [Abstract] | ||||||
Servicing Asset, Applying a 0.9 multiplier to default rate | 16,362 | |||||
Default rate assumption | Servicing Liabilities | Applying a 1.1 multiplier to default rate | ||||||
Applying Multiplier, Default Rate [Abstract] | ||||||
Servicing Liabilities, Applying a 1.1 multiplier to default rate | 28 | |||||
Default rate assumption | Servicing Liabilities | Applying a 1.1 multiplier to default rate | Prosper Funding LLC | ||||||
Applying Multiplier, Default Rate [Abstract] | ||||||
Servicing Liabilities, Applying a 1.1 multiplier to default rate | 28 | |||||
Default rate assumption | Servicing Liabilities | Applying a 0.9 multiplier to default rate | ||||||
Applying Multiplier, Default Rate [Abstract] | ||||||
Servicing Liabilities, Applying a 0.9 multiplier to default rate | 28 | |||||
Default rate assumption | Servicing Liabilities | Applying a 0.9 multiplier to default rate | Prosper Funding LLC | ||||||
Applying Multiplier, Default Rate [Abstract] | ||||||
Servicing Liabilities, Applying a 0.9 multiplier to default rate | $ 28 |
Fair Value of Assets and Liab59
Fair Value of Assets and Liabilities - Schedule of Prosper's and Prosper Funding's Estimated Fair Value of Servicing Assets and Liabilities Additional Info (Details) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Servicing rate increase | 0.65% |
Servicing rate decrease | 0.60% |
Prepayment rate assumption | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Prepayment rate increase | 1.10% |
Prepayment rate decrease | 0.90% |
Default rate assumption | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Default rate increase | 1.10% |
Default rate decrease | 0.90% |
Prosper Funding LLC | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Servicing rate increase | 0.65% |
Servicing rate decrease | 0.60% |
Prosper Funding LLC | Prepayment rate assumption | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Prepayment rate increase | 1.10% |
Prepayment rate decrease | 0.90% |
Prosper Funding LLC | Default rate assumption | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Default rate increase | 1.10% |
Default rate decrease | 0.90% |
Fair Value of Assets and Liab60
Fair Value of Assets and Liabilities - Financial Instruments, Assets and Liabilities not Recorded at Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Assets | ||||
Cash and Cash Equivalents | $ 58,652 | $ 45,795 | $ 34,667 | $ 22,337 |
Restricted Cash | 134,552 | 152,668 | $ 179,331 | $ 163,907 |
Accounts Receivable | 3,539 | 683 | ||
Total Assets | 702,808 | 623,735 | ||
Liabilities: | ||||
Accounts Payable and Accrued Liabilities | 14,652 | 11,942 | ||
Payable to Investors | 112,580 | 132,432 | ||
Warehouse Line | 103,553 | 0 | ||
Total Liabilities | 665,604 | $ 567,357 | ||
Carrying Amount | ||||
Assets | ||||
Total Assets | 196,743 | |||
Liabilities: | ||||
Total Liabilities | 230,785 | |||
Balance at Fair Value | ||||
Assets | ||||
Cash and Cash Equivalents | 58,652 | |||
Restricted Cash | 134,552 | |||
Accounts Receivable | 3,539 | |||
Total Assets | 196,743 | |||
Liabilities: | ||||
Accounts Payable and Accrued Liabilities | 14,652 | |||
Payable to Investors | 112,580 | |||
Warehouse Line | 103,553 | |||
Total Liabilities | 230,785 | |||
Level 1 Inputs | ||||
Assets | ||||
Cash and Cash Equivalents | 58,652 | |||
Restricted Cash | 0 | |||
Accounts Receivable | 0 | |||
Total Assets | 58,652 | |||
Liabilities: | ||||
Accounts Payable and Accrued Liabilities | 0 | |||
Payable to Investors | 0 | |||
Warehouse Line | 0 | |||
Total Liabilities | 0 | |||
Level 2 Inputs | ||||
Assets | ||||
Cash and Cash Equivalents | 0 | |||
Restricted Cash | 134,552 | |||
Accounts Receivable | 3,539 | |||
Total Assets | 138,091 | |||
Liabilities: | ||||
Accounts Payable and Accrued Liabilities | 14,652 | |||
Payable to Investors | 112,580 | |||
Warehouse Line | 103,553 | |||
Total Liabilities | 230,785 | |||
Level 3 Inputs | ||||
Assets | ||||
Cash and Cash Equivalents | 0 | |||
Restricted Cash | 0 | |||
Accounts Receivable | 0 | |||
Total Assets | 0 | |||
Liabilities: | ||||
Accounts Payable and Accrued Liabilities | 0 | |||
Payable to Investors | 0 | |||
Warehouse Line | 0 | |||
Total Liabilities | $ 0 |
Goodwill and Other Intangible61
Goodwill and Other Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Goodwill And Other Intangible Assets [Line Items] | |||||
Goodwill | $ 36,368,000 | $ 36,368,000 | $ 36,368,000 | ||
Goodwill impairment expense | 0 | ||||
Intangible assets, net | 1,177,000 | 1,177,000 | $ 1,377,000 | ||
Impairment loss | 0 | $ 6,319,000 | |||
Amortization of intangible assets | 100,000 | $ 200,000 | 200,000 | $ 1,000,000 | |
User base and customer relationships | |||||
Goodwill And Other Intangible Assets [Line Items] | |||||
Intangible assets, net | 1,177,000 | $ 1,177,000 | |||
Intangible assets amortized period | 6 years 9 months 18 days | ||||
User base and customer relationships | Minimum | |||||
Goodwill And Other Intangible Assets [Line Items] | |||||
Intangible assets amortized period | 3 years | ||||
User base and customer relationships | Maximum | |||||
Goodwill And Other Intangible Assets [Line Items] | |||||
Intangible assets amortized period | 10 years | ||||
Developed technology | |||||
Goodwill And Other Intangible Assets [Line Items] | |||||
Intangible assets, net | 0 | $ 0 | |||
Developed technology | Minimum | |||||
Goodwill And Other Intangible Assets [Line Items] | |||||
Intangible assets amortized period | 3 years | ||||
Developed technology | Maximum | |||||
Goodwill And Other Intangible Assets [Line Items] | |||||
Intangible assets amortized period | 5 years | ||||
Brand name | |||||
Goodwill And Other Intangible Assets [Line Items] | |||||
Intangible assets, net | $ 0 | $ 0 | |||
Intangible assets amortized period | 1 year |
Goodwill and Other Intangible62
Goodwill and Other Intangible Assets - Summary of Other Intangible Assets for the Period Presented (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Dec. 31, 2017 | |
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 8,170 | |
Accumulated Amortization | (6,993) | |
Net Carrying Value | 1,177 | $ 1,377 |
Developed technology | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 3,060 | |
Accumulated Amortization | (3,060) | |
Net Carrying Value | 0 | |
User base and customer relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 5,050 | |
Accumulated Amortization | (3,873) | |
Net Carrying Value | $ 1,177 | |
Remaining Useful Life (In Years) | 6 years 9 months 18 days | |
Brand name | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 60 | |
Accumulated Amortization | (60) | |
Net Carrying Value | $ 0 | |
Remaining Useful Life (In Years) | 1 year |
Goodwill And Other Intangible63
Goodwill And Other Intangible Assets - Summary of Estimated Amortization of Purchased Intangible Assets (Details) $ in Thousands | Jun. 30, 2018USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remainder of 2018 | $ 178 |
2,019 | 279 |
2,020 | 220 |
2,021 | 172 |
2,022 | 136 |
Thereafter | 192 |
Net Carrying Value | $ 1,177 |
Other Liabilities (Details)
Other Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Other Liabilities [Abstract] | ||
Loan trailing fee | $ 3,078 | $ 2,595 |
Deferred revenue | 436 | 452 |
Servicing liabilities | 28 | 59 |
Deferred income tax liability | 244 | 225 |
Deferred rent | 3,651 | 3,904 |
Restructuring liability | 3,457 | 3,355 |
Other | 2,824 | 2,079 |
Total Other Liabilities | $ 13,718 | $ 12,669 |
Debt (Details)
Debt (Details) - USD ($) | Jun. 12, 2018 | Jun. 30, 2018 | Jan. 19, 2018 | Dec. 31, 2017 |
Line of Credit Facility [Line Items] | ||||
Warehouse Line | $ 103,553,000 | $ 0 | ||
Loans Held for Sale, at Fair Value | 116,817,000 | $ 49,000 | ||
Warehouse Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | $ 200,000,000 | $ 100,000,000 | ||
Repayment period | 24 months | |||
Advance rate | 89.00% | |||
Warehouse Line | 103,600,000 | |||
Minimum tangible net worth | $ 25,000,000 | |||
Minimum net liquidity | $ 15,000,000 | |||
Maximum leverage ratio | 5 | |||
Undrawn portion | 96,900,000 | |||
Capitalized debt issuance cost | 1,600,000 | |||
Warehouse Agreement | Secured Debt | ||||
Line of Credit Facility [Line Items] | ||||
Loans Held for Sale, at Fair Value | $ 116,200,000 | |||
LIBOR | Warehouse Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 3.00% | |||
Minimum | Warehouse Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Commitment fee percent | 0.50% | |||
Maximum | Warehouse Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Commitment fee percent | 0.75% |
Net Loss Per Share - Basic and
Net Loss Per Share - Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Numerator: | ||||
Net loss available to common stockholders for basic and diluted EPS | $ (12,599) | $ (41,405) | $ (24,000) | $ (65,426) |
Denominator: | ||||
Weighted average shares used in computing basic and diluted net loss per share (in shares) | 70,362,716 | 69,691,841 | 70,333,145 | 69,436,365 |
Basic and diluted net loss per share (in dollars per share) | $ (0.18) | $ (0.59) | $ (0.34) | $ (0.94) |
Net Loss Per Share - Common Sto
Net Loss Per Share - Common Stock Equivalents Excluded from Computation of Diluted Net Loss Per Share (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total common stock equivalents excluded from diluted net loss per common share computation (in shares) | 504,192,237 | 452,811,881 | 495,391,573 | 444,914,220 |
Convertible preferred stock issued and outstanding | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total common stock equivalents excluded from diluted net loss per common share computation (in shares) | 214,637,925 | 177,388,428 | 214,637,925 | 177,388,428 |
Stock options issued and outstanding | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total common stock equivalents excluded from diluted net loss per common share computation (in shares) | 75,206,928 | 60,938,265 | 66,403,696 | 53,040,604 |
Unvested stock options exercised | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total common stock equivalents excluded from diluted net loss per common share computation (in shares) | 2,190 | 20,940 | 2,190 | 20,940 |
Restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total common stock equivalents excluded from diluted net loss per common share computation (in shares) | 0 | 0 | 0 | 0 |
Warrants issued and outstanding | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total common stock equivalents excluded from diluted net loss per common share computation (in shares) | 1,080,349 | 1,199,403 | 1,082,917 | 1,199,403 |
Series E-1 convertible preferred stock warrants | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total common stock equivalents excluded from diluted net loss per common share computation (in shares) | 35,544,141 | 35,544,141 | 35,544,141 | 35,544,141 |
Series F convertible preferred stock warrants | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total common stock equivalents excluded from diluted net loss per common share computation (in shares) | 177,720,704 | 177,720,704 | 177,720,704 | 177,720,704 |
Convertible Preferred Stock, 68
Convertible Preferred Stock, Warrant Liability and Stockholders’ Deficit - Additional Information (Details) $ / shares in Units, $ in Thousands | Sep. 20, 2017USD ($)$ / sharesshares | Dec. 16, 2016 | Feb. 16, 2016 | Jun. 30, 2018USD ($)$ / sharesshares | Jun. 30, 2018USD ($)time$ / sharesshares | Dec. 31, 2017vote / shares$ / sharesshares | Feb. 27, 2017$ / sharesshares |
Class of Stock [Line Items] | |||||||
Common and preferred stock, shares authorized (in shares) | 1,069,760,848 | ||||||
Common stock, shares authorized (in shares) | 625,000,000 | 625,000,000 | 625,000,000 | 625,000,000 | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||
Preferred stock, shares authorized (in shares) | 444,760,848 | 444,760,848 | 444,760,848 | 444,760,848 | |||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||||||
Common stock, shares issued (in shares) | 71,317,926 | 71,317,926 | 71,226,934 | ||||
Common stock, shares outstanding (in shares) | 70,381,991 | 70,381,991 | 70,290,999 | ||||
Common stock, vote per share | vote / shares | 1 | ||||||
Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Stock split conversion ratio | 5 | ||||||
Exercise of stock options (in shares) | 82,792 | ||||||
Cash proceeds | $ | $ 18 | ||||||
Unvested restricted stock outstanding (in shares) | 2,190 | 2,190 | 11,565 | ||||
Stock repurchase upon termination of employment (in shares) | 0 | ||||||
Series E-1 | |||||||
Class of Stock [Line Items] | |||||||
Warrant to purchase (in of shares) | 15,277,006 | ||||||
Exercise price (in dollars per share) | $ / shares | $ 0.01 | ||||||
Liquidation preference (in dollars per share) | $ / shares | $ 0.84 | $ 0.84 | |||||
Warrant expiration period | 10 years | ||||||
Income (expense) amount | $ | $ 1,100 | $ 2,500 | |||||
Risk-free interest rate | 2.83% | 2.38% | |||||
Preferred stock, shares authorized (in shares) | 35,544,141 | 35,544,141 | |||||
Series E-2 | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, liquidation preference, conversion basis | 0.6667 | ||||||
Preferred stock, liquidation preference, conversion basis, after payment | 0.3333 | ||||||
Liquidation preference (in dollars per share) | $ / shares | $ 0.84 | $ 0.84 | |||||
Preferred stock, shares authorized (in shares) | 16,858,078 | 16,858,078 | |||||
Series F | |||||||
Class of Stock [Line Items] | |||||||
Warrant to purchase (in of shares) | 177,720,706 | ||||||
Exercise price (in dollars per share) | $ / shares | $ 0.01 | ||||||
Preferred stock, liquidation preference, conversion basis | 0.6667 | ||||||
Preferred stock, liquidation preference, conversion basis, after payment | 0.3333 | ||||||
Liquidation preference (in dollars per share) | $ / shares | $ 0.84 | $ 0.84 | |||||
Income (expense) amount | $ | $ 2,900 | $ 6,100 | |||||
Risk-free interest rate | 2.83% | 2.38% | |||||
Preferred stock, shares authorized (in shares) | 177,720,707 | 177,720,707 | |||||
Series G | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock issued and sold (in shares) | 37,249,497 | ||||||
Purchase price (in dollars per share) | $ / shares | $ 1.34230000474906 | ||||||
Proceeds from issuance of preferred stock | $ | $ 47,900 | ||||||
Voting power (at least) | 60.00% | ||||||
Liquidation preference (in dollars per share) | $ / shares | $ 1.34 | $ 1.34 | |||||
Preferred stock, shares authorized (in shares) | 37,249,497 | 37,249,497 | |||||
Series B | |||||||
Class of Stock [Line Items] | |||||||
IPO value (at least) | $ | $ 2,000,000 | ||||||
Aggregate proceeds (at least) | $ | $ 100,000 | ||||||
Voting power (at least) | 60.00% | ||||||
Liquidation preference (in dollars per share) | $ / shares | $ 0.60 | $ 0.60 | |||||
Preferred stock, shares authorized (in shares) | 35,775,880 | 35,775,880 | |||||
Series A-1 | |||||||
Class of Stock [Line Items] | |||||||
Voting power (at least) | 14.00% | ||||||
Conversion ratio | 1,000,000 | 1,000,000 | |||||
Liquidation preference (in dollars per share) | $ / shares | $ 2 | $ 2 | |||||
Series A | |||||||
Class of Stock [Line Items] | |||||||
Conversion ratio | 1 | 1 | |||||
Times the original issue | time | 3 | ||||||
Liquidation preference (in dollars per share) | $ / shares | $ 0.29 | $ 0.29 | |||||
Preferred stock, shares authorized (in shares) | 68,558,220 | 68,558,220 | |||||
Series C | |||||||
Class of Stock [Line Items] | |||||||
Liquidation preference (in dollars per share) | $ / shares | $ 2.87 | $ 2.87 | |||||
Preferred stock, shares authorized (in shares) | 24,404,770 | 24,404,770 | |||||
Series D | |||||||
Class of Stock [Line Items] | |||||||
Liquidation preference (in dollars per share) | $ / shares | $ 6.91 | $ 6.91 | |||||
Consortium Purchase Agreement | Series F Warrant | |||||||
Class of Stock [Line Items] | |||||||
Warrant to purchase (in of shares) | 177,720,706 | ||||||
Exercise price (in dollars per share) | $ / shares | $ 0.01 | ||||||
US Treasury securities | Series E-1 | |||||||
Class of Stock [Line Items] | |||||||
Risk-free interest rate | 0.00% | ||||||
US Treasury securities | Series F | |||||||
Class of Stock [Line Items] | |||||||
Risk-free interest rate | 0.00% |
Convertible Preferred Stock, 69
Convertible Preferred Stock, Warrant Liability and Stockholders’ Deficit - Summary of Shares Authorized, Issued, Outstanding, Par Value and Liquidation Preference of Convertible Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Sep. 20, 2017 |
Class of Stock [Line Items] | |||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Convertible preferred stock, shares authorized (in shares) | 444,760,848 | 444,760,848 | 444,760,848 |
Convertible preferred stock, shares outstanding (in shares) | 214,637,925 | 214,637,925 | |
Convertible preferred stock, shares issued (in shares) | 214,637,925 | 214,637,925 | |
Convertible preferred stock, aggregate liquidation preference | $ 375,952 | $ 375,952 | |
Series A | |||
Class of Stock [Line Items] | |||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | ||
Convertible preferred stock, shares authorized (in shares) | 68,558,220 | ||
Convertible preferred stock, shares outstanding (in shares) | 68,558,220 | ||
Convertible preferred stock, shares issued (in shares) | 68,558,220 | ||
Convertible preferred stock, aggregate liquidation preference | $ 19,774 | ||
Series A-1 | |||
Class of Stock [Line Items] | |||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | ||
Convertible preferred stock, shares authorized (in shares) | 24,760,915 | ||
Convertible preferred stock, shares outstanding (in shares) | 24,760,915 | ||
Convertible preferred stock, shares issued (in shares) | 24,760,915 | ||
Convertible preferred stock, aggregate liquidation preference | $ 49,522 | ||
Series B | |||
Class of Stock [Line Items] | |||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | ||
Convertible preferred stock, shares authorized (in shares) | 35,775,880 | ||
Convertible preferred stock, shares outstanding (in shares) | 35,775,880 | ||
Convertible preferred stock, shares issued (in shares) | 35,775,880 | ||
Convertible preferred stock, aggregate liquidation preference | $ 21,581 | ||
Series C | |||
Class of Stock [Line Items] | |||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | ||
Convertible preferred stock, shares authorized (in shares) | 24,404,770 | ||
Convertible preferred stock, shares outstanding (in shares) | 24,404,770 | ||
Convertible preferred stock, shares issued (in shares) | 24,404,770 | ||
Convertible preferred stock, aggregate liquidation preference | $ 70,075 | ||
Series D | |||
Class of Stock [Line Items] | |||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | ||
Convertible preferred stock, shares authorized (in shares) | 23,888,640 | ||
Convertible preferred stock, shares outstanding (in shares) | 23,888,640 | ||
Convertible preferred stock, shares issued (in shares) | 23,888,640 | ||
Convertible preferred stock, aggregate liquidation preference | $ 165,000 | ||
Series E-1 | |||
Class of Stock [Line Items] | |||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | ||
Convertible preferred stock, shares authorized (in shares) | 35,544,141 | ||
Convertible preferred stock, shares outstanding (in shares) | 0 | ||
Convertible preferred stock, shares issued (in shares) | 0 | ||
Convertible preferred stock, aggregate liquidation preference | $ 0 | ||
Series E-2 | |||
Class of Stock [Line Items] | |||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | ||
Convertible preferred stock, shares authorized (in shares) | 16,858,078 | ||
Convertible preferred stock, shares outstanding (in shares) | 0 | ||
Convertible preferred stock, shares issued (in shares) | 0 | ||
Convertible preferred stock, aggregate liquidation preference | $ 0 | ||
Series F | |||
Class of Stock [Line Items] | |||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | ||
Convertible preferred stock, shares authorized (in shares) | 177,720,707 | ||
Convertible preferred stock, shares outstanding (in shares) | 3 | ||
Convertible preferred stock, shares issued (in shares) | 3 | ||
Convertible preferred stock, aggregate liquidation preference | $ 0 | ||
Series G | |||
Class of Stock [Line Items] | |||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | ||
Convertible preferred stock, shares authorized (in shares) | 37,249,497 | ||
Convertible preferred stock, shares outstanding (in shares) | 37,249,497 | ||
Convertible preferred stock, shares issued (in shares) | 37,249,497 | ||
Convertible preferred stock, aggregate liquidation preference | $ 50,000 |
Convertible Preferred Stock, 70
Convertible Preferred Stock, Warrant Liability and Stockholders’ Deficit - Schedule of Assumptions Used (Details) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Series E-1 | ||
Class of Stock [Line Items] | ||
Volatility | 40.00% | 40.00% |
Risk-free interest rate | 2.83% | 2.38% |
Remaining contractual term (in years) | 8 years 6 months 18 days | 9 years 15 days |
Dividend yield | 0.00% | 0.00% |
Series F | ||
Class of Stock [Line Items] | ||
Volatility | 40.00% | 40.00% |
Risk-free interest rate | 2.83% | 2.38% |
Remaining contractual term (in years) | 8 years 7 months 28 days | 9 years 1 month 28 days |
Dividend yield | 0.00% | 0.00% |
Convertible Preferred Stock, 71
Convertible Preferred Stock, Warrant Liability and Stockholders’ Deficit - Warrant Liability (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Warrants or Rights [Roll Forward] | ||
Change in Fair Value | $ (8,602) | $ 22,817 |
Convertible Preferred Stock Warrant | ||
Warrants or Rights [Roll Forward] | ||
Balance at January 1, 2018 | 116,366 | |
Warrants Vested | 35,912 | |
Change in Fair Value | (8,602) | |
Balance as of June 30, 2018 | $ 143,676 |
Share Based Incentive Plan an72
Share Based Incentive Plan and Compensation - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Options exercisable, maximum period | 10 years | |||
Financial statement impact amount | $ 4,584,000 | $ 6,812,000 | ||
Unamortized expense related to unvested stock-based awards | $ 10,400,000 | $ 10,400,000 | ||
Dividend yield | 0.00% | 0.00% | 0.00% | |
Unrecognized cost of unvested share-based compensation awards. | $ 0 | $ 0 | ||
Remaining weighted average vesting period | 2 years | |||
Internal-use software and website development costs | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation capitalized | 100,000 | $ 100,000 | ||
Stock option repricing | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Financial statement impact amount | 200,000 | |||
Unamortized expense related to unvested stock-based awards | $ 700,000 | $ 700,000 | ||
Weighted average vesting period | 1 year 1 month 6 days | |||
Restricted stock units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Aggregate fair value | $ 1,900,000 | |||
Vesting period one | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting percent | 25.00% | |||
Vesting period of the options | 1 year | |||
Incremental vesting percent | 2.08% | |||
Vesting period one | Restricted stock units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting period of the options | 3 years | |||
Vesting period two | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting percent | 50.00% | |||
Vesting period of the options | 1 year | |||
Incremental vesting percent | 2.08% | |||
Vesting period two | Restricted stock units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting period of the options | 4 years | |||
Vesting period three | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting percent | 50.00% | |||
Vesting period of the options | 2 years | |||
Incremental vesting percent | 2.08% | |||
Vesting period four | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Incremental vesting percent | 2.78% | |||
2015 Stock Option Plan | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Number of options made available in pool (in shares) | 93,468,710 | 93,468,710 | ||
Shares available for grant under the plan (in shares) | 22,824,771 | 22,824,771 | ||
2005 Stock Plan | Stock options issued and outstanding | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Shares available for grant under the plan (in shares) | 0 | 0 |
Share Based Incentive Plan an73
Share Based Incentive Plan and Compensation - Summarized Option Activity under Option Plan (Details) - 2005 Stock Plan and 2015 Stock Option Plan | 6 Months Ended |
Jun. 30, 2018$ / sharesshares | |
Options Issued and Outstanding | |
Options Issued and Outstanding, Beginning Balance (in shares) | shares | 58,628,039 |
Options Issued and Outstanding, Options issued (in shares) | shares | 18,703,551 |
Options Issued and Outstanding, Options exercised - vested (in shares) | shares | (82,792) |
Options Issued and Outstanding, Options forfeited (in shares) | shares | (3,879,249) |
Options Issued and Outstanding, Ending balance (in shares) | shares | 73,369,549 |
Options Issued and Outstanding, Options vested and expected to vest (in shares) | shares | 60,048,513 |
Options Issued and Outstanding, Options vested and/or exercisable (in shares) | shares | 34,914,602 |
Weighted- Average Exercise Price | |
Weighted-Average Exercise Price, Beginning balance (in dollars per share) | $ / shares | $ 0.25 |
Weighted-Average Exercise Price, Options issued (in dollars per share) | $ / shares | 0.54 |
Weighted-Average Exercise Price, Options exercised - vested (in dollars per share) | $ / shares | 0.22 |
Weighted-Average Exercise Price, Options forfeited (in dollars per share) | $ / shares | 0.37 |
Weighted-Average Exercise Price, Ending balance (in dollars per share) | $ / shares | 0.32 |
Weighted-Average Exercise Price, Options vested and expected to vest (in dollars per share) | $ / shares | 0.32 |
Weighted-Average Exercise Price, Options vested and/or exercisable (in dollars per share) | $ / shares | $ 0.22 |
Share Based Incentive Plan an74
Share Based Incentive Plan and Compensation - Additional Information Regarding Common Stock Options Outstanding (Details) - Stock options issued and outstanding | 6 Months Ended |
Jun. 30, 2018$ / sharesshares | |
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |
Range of Exercise Prices, Minimum (in dollars per share) | $ 0.02 |
Range of Exercise Prices, Maximum (in dollars per share) | $ 1.13 |
Number Outstanding (in shares) | shares | 73,369,549 |
Weighted Avg. Remaining Life | 8 years 6 months 4 days |
Weighted Avg. Exercise Price (in dollars per share) | $ 0.32 |
Number Vested and Exercisable (in shares) | shares | 34,914,602 |
Weighted-Avg. Exercise Price (in dollars per share) | $ 0.22 |
0.02 - 0.20 | |
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |
Range of Exercise Prices, Minimum (in dollars per share) | 0.02 |
Range of Exercise Prices, Maximum (in dollars per share) | $ 0.20 |
Number Outstanding (in shares) | shares | 4,768,290 |
Weighted Avg. Remaining Life | 5 years 6 months 18 days |
Weighted Avg. Exercise Price (in dollars per share) | $ 0.11 |
Number Vested and Exercisable (in shares) | shares | 4,768,290 |
Weighted-Avg. Exercise Price (in dollars per share) | $ 0.11 |
0.21 - 0.50 | |
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |
Range of Exercise Prices, Minimum (in dollars per share) | 0.21 |
Range of Exercise Prices, Maximum (in dollars per share) | $ 0.50 |
Number Outstanding (in shares) | shares | 45,281,131 |
Weighted Avg. Remaining Life | 8 years 3 months |
Weighted Avg. Exercise Price (in dollars per share) | $ 0.23 |
Number Vested and Exercisable (in shares) | shares | 28,602,923 |
Weighted-Avg. Exercise Price (in dollars per share) | $ 0.22 |
0.51 - 1.13 | |
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |
Range of Exercise Prices, Minimum (in dollars per share) | 0.51 |
Range of Exercise Prices, Maximum (in dollars per share) | $ 1.13 |
Number Outstanding (in shares) | shares | 23,320,128 |
Weighted Avg. Remaining Life | 9 years 7 months 6 days |
Weighted Avg. Exercise Price (in dollars per share) | $ 0.54 |
Number Vested and Exercisable (in shares) | shares | 1,543,389 |
Weighted-Avg. Exercise Price (in dollars per share) | $ 0.54 |
Share Based Incentive Plan an75
Share Based Incentive Plan and Compensation - Fair Value of Stock Option Awards (Details) | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | |
Fair value of stock option awards [Abstract] | |||
Volatility of common stock | 44.43% | 44.12% | 50.28% |
Risk-free interest rate | 2.85% | 2.75% | 2.12% |
Expected life (in years) | 6 years | 6 years | 5 years 8 months 12 days |
Dividend yield | 0.00% | 0.00% | 0.00% |
Share Based Incentive Plan an76
Share Based Incentive Plan and Compensation - Summarized Activities for the Company's RSU's (Details) - Restricted stock units | 6 Months Ended |
Jun. 30, 2018$ / sharesshares | |
Number of Shares | |
Restricted stock unit, Unvested, Beginning Balance (in shares) | shares | 1,399,180 |
Granted (in shares) | shares | 3,569,586 |
Vested (in shares) | shares | 0 |
Forfeited (in shares) | shares | (100,500) |
Restricted stock unit, Unvested, Ending Balance (in shares) | shares | 4,868,266 |
Weighted-Average Grant Date Fair Value | |
Restricted stock unit, Unvested, Beginning Balance (in dollars per share) | $ / shares | $ 2.16 |
Granted (in dollars per share) | $ / shares | 0.54 |
Vested (in dollars per share) | $ / shares | 0 |
Forfeited (in dollars per share) | $ / shares | 2.17 |
Restricted stock unit, Unvested, Ending Balance (in dollars per share) | $ / shares | $ 0.96 |
Share Based Incentive Plan an77
Share Based Incentive Plan and Compensation - Stock Based Compensation Included in Consolidated Statements of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock based compensation | $ 2,253 | $ 3,312 | $ 4,584 | $ 6,812 |
Origination and servicing | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock based compensation | 241 | 328 | 456 | 545 |
Sales and marketing | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock based compensation | 108 | 141 | 216 | 311 |
General and administrative | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock based compensation | $ 1,904 | $ 2,843 | $ 3,912 | $ 5,956 |
Restructuring - Summary of Acti
Restructuring - Summary of Activities Related to Prosper's Restructuring Plan (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Restructuring Reserve [Roll Forward] | |
Balance January 1, 2018 | $ 3,244 |
Adjustments to expense | 591 |
Sublease cash receipts | 316 |
Less: Cash paid | (775) |
Balance June 30, 2018 | 3,376 |
Facilities Related | |
Restructuring Reserve [Roll Forward] | |
Balance January 1, 2018 | 3,244 |
Adjustments to expense | 591 |
Sublease cash receipts | 316 |
Less: Cash paid | (775) |
Balance June 30, 2018 | $ 3,376 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Income Taxes [Line Items] | ||||
Income tax expense | $ 9,000 | $ 97,000 | $ 19,000 | $ 262,000 |
Prosper Funding LLC | ||||
Income Taxes [Line Items] | ||||
Income tax expense | $ 0 | 0 | ||
Net effective tax rate | 0.00% | |||
Valuation Allowance of Deferred Tax Assets | ||||
Income Taxes [Line Items] | ||||
Income tax expense | $ 0 | $ 0 |
Consortium Purchase Agreement -
Consortium Purchase Agreement - Narrative (Details) - Consortium Purchase Agreement - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | ||
Jun. 30, 2018 | Dec. 31, 2017 | Feb. 27, 2017 | |
Other Commitments [Line Items] | |||
Commitment to purchase borrower loans (up to) | $ 5,000,000 | $ 5,000,000 | |
Loans acquired | 2,657,624 | $ 1,826,527 | |
Amount settled with rebates | $ 300,000 | ||
Series F Warrant | |||
Other Commitments [Line Items] | |||
Warrant to purchase up to (in shares) | 3 | ||
Warrant to purchase (in of shares) | 177,720,706 | ||
Exercise price (in dollars per share) | $ 0.01 |
Consortium Purchase Agreement81
Consortium Purchase Agreement - Consortium Purchase Agreement Table (Details) - Consortium Purchase Agreement - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Dec. 31, 2017 | |
Other Commitments [Line Items] | ||
Loans Acquired | $ 2,657,624 | $ 1,826,527 |
Loans Purchased by the Consortium | $ 831,097 | |
Series F Warrant | ||
Other Commitments [Line Items] | ||
Warrants Vested (in shares) | 112,016,280 | 75,186,002 |
Warrants vested during the year (in shares) | 36,830,278 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) | Jun. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 |
Commitments And Contingencies [Line Items] | ||||||
Minimum sublease rentals | $ 6,500,000 | $ 6,500,000 | $ 6,500,000 | |||
Restructuring Reserve | 3,376,000 | 3,376,000 | 3,376,000 | $ 3,244,000 | ||
Rental expense under operating lease arrangements | 1,000,000 | $ 1,200,000 | 2,100,000 | $ 2,500,000 | ||
Designated Amount for loans (less than) | 143,500 | 143,500 | 143,500 | |||
Minimum liquidity covenant | 15,000,000 | 15,000,000 | 15,000,000 | |||
Purchase of borrower loans | 31,500,000 | |||||
Maximum potential future payments | 3,900,000,000 | 3,900,000,000 | 3,900,000,000 | |||
Accrued repurchase and indemnification obligation | 1,300,000 | 1,300,000 | 1,300,000 | 800,000 | ||
Prosper Funding LLC | ||||||
Commitments And Contingencies [Line Items] | ||||||
Designated Amount for loans (less than) | 143,500 | 143,500 | 143,500 | |||
Minimum fee, remaining in current year | 900,000 | 900,000 | 900,000 | |||
Minimum fee, year two | 900,000 | 900,000 | 900,000 | |||
Purchase of borrower loans | 31,500,000 | |||||
Maximum potential future payments | 3,900,000,000 | 3,900,000,000 | 3,900,000,000 | |||
Accrued repurchase and indemnification obligation | $ 1,300,000 | $ 1,300,000 | $ 1,300,000 | $ 800,000 |
Commitments and Contingencies83
Commitments and Contingencies - Future Minimum Lease Payments (Details) $ in Thousands | Jun. 30, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Remainder of 2018 | $ 2,939 |
2,019 | 6,026 |
2,020 | 6,193 |
2,021 | 6,170 |
2,022 | 6,076 |
Thereafter | 8,480 |
Total | $ 35,884 |
Related Parties - Additional In
Related Parties - Additional Information (Details) | 6 Months Ended |
Jun. 30, 2018 | |
Related Party Transactions [Abstract] | |
Minimum percentage of voting securities considered for related parties | 10.00% |
Minimum percentage of stock holders considered for related parties | 10.00% |
Related Parties - Aggregate Amo
Related Parties - Aggregate Amount of Notes Purchased and the Income Earned (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | |||||
Aggregate Amount of Notes and Borrower Loans Purchased | $ 110 | $ 90 | $ 217 | $ 184 | |
Interest Earned on Notes and Borrower Loans | 11 | 45 | 23 | 101 | |
Notes balance | 577 | 577 | $ 591 | ||
Prosper Funding LLC | |||||
Related Party Transaction [Line Items] | |||||
Aggregate Amount of Notes and Borrower Loans Purchased | 3 | 5 | 9 | 10 | |
Interest Earned on Notes and Borrower Loans | 0 | 35 | 1 | 81 | |
Notes balance | 17 | 17 | 38 | ||
Executive officers and management | |||||
Related Party Transaction [Line Items] | |||||
Aggregate Amount of Notes and Borrower Loans Purchased | 3 | 5 | 9 | 10 | |
Interest Earned on Notes and Borrower Loans | 0 | 35 | 1 | 81 | |
Notes balance | 17 | 17 | 38 | ||
Executive officers and management | Prosper Funding LLC | |||||
Related Party Transaction [Line Items] | |||||
Aggregate Amount of Notes and Borrower Loans Purchased | 3 | 5 | 9 | 10 | |
Interest Earned on Notes and Borrower Loans | 0 | 35 | 1 | 81 | |
Notes balance | 17 | 17 | 38 | ||
Directors (excluding executive officers and management) | |||||
Related Party Transaction [Line Items] | |||||
Aggregate Amount of Notes and Borrower Loans Purchased | 107 | 85 | 208 | 174 | |
Interest Earned on Notes and Borrower Loans | 11 | 10 | 22 | 20 | |
Notes balance | 560 | 560 | 553 | ||
Directors (excluding executive officers and management) | Prosper Funding LLC | |||||
Related Party Transaction [Line Items] | |||||
Aggregate Amount of Notes and Borrower Loans Purchased | 0 | 0 | 0 | 0 | |
Interest Earned on Notes and Borrower Loans | 0 | $ 0 | 0 | $ 0 | |
Notes balance | $ 0 | $ 0 | $ 0 |
Significant Concentrations (Det
Significant Concentrations (Details) | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Concentration Risk [Line Items] | ||
Percentage of funds originating in channel | 93.00% | 92.00% |
Party One | ||
Concentration Risk [Line Items] | ||
Percentage of loan purchased | 52.00% | 52.00% |
Party Two | ||
Concentration Risk [Line Items] | ||
Percentage of loan purchased | 14.00% | |
Party Three | ||
Concentration Risk [Line Items] | ||
Percentage of loan purchased | 8.00% |