LendEDU is an online marketplace for a variety of financial products, including student loans, personal loans, and credit cards. It has been compared to Lendingtree.com, but for student lending. In 2018, LendEDU encountered controversy when it was revealed to be the undisclosed owner of "Student Loan Report", and its CEO was accused of "deceiving news organizations with a fake source".
History
Nate Matherson and Matt Lenhard, University of Delaware students, attended the Iowa Startup Accelerator in summer 2014 with the idea for an online tutor-booking platform they called ShopTutors. The original idea was dismissed, and LendEDU, an online marketplace for student loans and student loan financing, became their focus; as someone with nearly $50,000 in student loan debt, Matherson was looking to refinance his student loans and realized the potential business idea that would eventually become LendEDU. Through the program, LendEDU earned $50,000 in funding from Built by Iowa. Additionally, LendEDU received a $5,000 grant from the University of Delaware's VentureOn program which focuses on the development of small businesses. The University of Delaware spoke about LendEDU in the 167th Commencement for the 2016 graduating class. Through 2015, the company expanded using resources from the Horn Program Venture Development Center. They were chosen to participate in Y Combinator in December 2015. At that point, it had raised a total of $120,000 in funding. At the start of the program, LendEDU received $120,000 for seven percent of the company. As part of Y Combinator's Winter 2016 class, LendEDU saw a 50 percent net monthly revenue growth. In April 2016, LendEDU was on track to reach $50,000 in monthly revenue and achieve profitability. After Y Combinator, LendEDU moved to New York City area, specifically Hoboken, New Jersey.
Platform
The LendEDU platform operates with the same basic functionality for the different financial products it features on its website like student loans, mortgages, personal loans, and various insurance products. What was originally a platform that only gave users the option to compare student loan refinancing options, the platform now compares lenders, rates, terms, and qualification requirements for student loan refinancing, private student loans, personal loans, mortgages, various insurance products, credit cards and more. The LendEDU platform enables consumers to compare lenders, rates, terms, and qualification requirements for financial products specific to the consumer's financial situation. For example, a borrower looking to refinance their student loans could compare lenders, rates, terms, and qualification requirements to find a student loan refinancing option that fits his or her specific situation.
Charitable works & Initiatives
LendEDU's philanthropic efforts include work with One Tree Planted, a reforestation program that plants trees around the world in collaboration with partnering companies; the LendEDU Scholarship, which offers $1,000 scholarships to two students at the high school or college level two times per year; and donations to local charities in New Jersey like The Hoboken Shelter, Advance the Cure for MS, and the Community FoodBank of New Jersey. In September 2019, LendEDU was a co-sponsor for the Pride Center of New Jersey's first annual gala that celebrated the Pride Center's 25th anniversary of service to New Jersey's LGBTQ community. Other sponsors of the event included Robert Wood Johnson University Hospital, WellCare, and KP Edgestone Realty.
In the News
LendEDU's data and research have been featured in press reports. In June 2019, LendEDU released another study that evaluated how seriously student loan debt weighs on consumers that are filing for Chapter 7 bankruptcy, and this report was covered by media outlets like Business Insider and Diverse Education LendEDU's "top 50 college financial literacy program" rankings are based on a multitude of factors, including the number of workshops and resources available, access to one-on-one financial consultation, and incentivizing programs available.
Drew Cloud Controversy
Around 2016, a Web site called "The Student Loan Report" started conducting surveys and issuing reports. A 2018 report, quoted by outlets including Fox News, CNBC, and Inside Higher Ed, stated one in five had invested student loan money in digital currency. According to a subsequent investigation by the Chronicle of Higher Education, the Web site's ostensible founder, "Drew Cloud", despite having "corresponded at length with many journalists" to provide stories, turned out to be fictitious. The Chronicle accused LendEDU of "deceiving news organizations with a fake source" by using the pen name "Drew Cloud." The Chronicle also criticized that, despite LendEDU's ownership of the Student Loan Report, no association between the two had been disclosed. The Atlantic criticized that "The opaque process of managing student debt can be confusing, and LendEDU's strategy seized upon that confusion to encourage people to consider courses of action, including refinancing, that would make the company money." The Boston Globe reported that "Pollfish, the company that performed the survey for Matherson, said it arrived at its results independently, and that the findings were accurate." According to NPR, the Student Loan Report website received over 8,000 visitors in April 2018. In March 2020, the Federal Trade Commission announced that it reached a settlement with operators of LendEDU over allegations of misleading ratings and reviews.
