A VC in Vacationland

Psst…want to make a fast 10-20%(or more) on your investments by investing in start ups?  Don’t have the millions it takes to become an LP (that’s limited partner) in a venture fund, or want to wait seven years for a payoff?

Well, Prosper may be your ticket.  You (and many other borrowers) can bid on making loans for all kinds of purposes to people/businesses with all kinds of credit ratings. The average investment is a few hundred dollars by any borrower.  The poorer the credit rating or purpose of the loan, the higher the interest rate.  It is a real marketplace for any kind of loan you can imagine–debt consolidation is a major request.  But there are a sprinkling of interesting business propositions each week that one could put a few bucks into.  Not world class entrepreneurs, for sure, but honest people trying to find a source of funds in a tight credit environment.

Prosper does credit checks on the potential borrowers and will go after dead beats with collection agencies, so no free lunch here.  Still, there is the air of going to Las Vegas in making investments.  You really have very little information to make a decision on–no business plan, no real references, not much history on the borrowers.

I find it interesting as an alternative capital source for people needing $10,000-$30,000 to start up a business. 

Check it out.  Beats gambling on-line.