Wharton FinTech
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Brett Crosby, CCO of PeerStreet — Building a Two-Sided Marketplace

In today’s episode, Anirudh Singh sits down with Brett Crosby, CCO of PeerStreet.

They discuss:

Brett’s Entrepreneurial Past:
Brett started his first business shortly after graduating from USC. While the business did not gain significant traction, it helped Brett identify some trends in the burgeoning internet economy. Taking advantage of these trends, Brett co-founded Urchin, a web analytics platform. In 2004, Google’s conversion tracking team approached Brett and his cofounder, and by 2005 Urchin was sold to Google to become Google analytics. Brett spent his next 10 years at Google before eventually being convinced by Brew Johnson to co-found PeerStreet.

Joining PeerStreet and the Challenges with a Two-Sided Marketplace:
Brett’s co-founder Brew saw some challenges in the real estate market during his work as a lawyer, driven predominantly by irresponsible decision making. By 2013, with new crowdfunding laws and the success of consumer credit companies LendingClub and Prosper, Brett and Brew decided to tackle the commercial credit marketplace.

Early on, the team recognized the need for technology advancements to make PeerStreet’s platform successful. In traditional real-estate lending, more than half of the interest payments made by the borrow are stripped out before reaching the investor. PeerStreet intended to change this by digitizing their offering and fractionalizing investment opportunities. Initially, Brett underestimated how challenging building a two-sided marketplace would be, especially for a long-term, high-ticket asset class. To drive initial demand for the platform, the team started operation Flywheel, in which they purchased a number of loans with only a few months left on their term, and put these on the platform to quickly attract investments. They started by adding a few loans a week, then a few loans a day, and quickly momentum for PeerStreet became unstoppable. While the demand side of the platform was the initial challenge the company faced, Brew has seen the team put more of a focus on the supply side as the company has reached scale.

The Future of PeerStreet:
Moving forward, Brett expects the team to continue to digitize and automate its offerings, particularly for suppliers. The team also recently launched PeerStreet Pocket, a new way for retail investors to earn interest on available cash. In the long term, Brett hopes to make retail investing as close to buying and selling stocks as possible, although he foresees some regulatory challenges in making this possible.

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Brett Crosby:

> Co-founder and CCO of PeerStreet.com, an Andreessen Horowitz-backed platform for investing in real estate debt with the goal of transforming mortgage finance.

> Formerly Director of Product Marketing at Google for Chrome, Gmail, Docs and Drive. Founder and head of strategic growth on Google Analytics. Launched and ran product marketing for Google+, Mobile Ads, Local Ads and more.

> Founder, Board member and Vice President of Urchin Software Corporation, acquired by Google in 2005.

> Specialties: Business strategy, company culture, product market fit, user growth, product marketing, product development, public speaking, press/media, social, mobile, web analytics, surfing and mountain biking.

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Anirudh Singh
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About the Author
Anirudh Singh is a second-year MBA Candidate at The Wharton School, where he is part of the Wharton FinTech Podcast team. He has a passion for economic development, venture capital, financial services, and all things FinTech. Don’t hesitate to reach out with questions, comments, feedback, and opportunities at singhan@wharton.upenn.edu.

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Anirudh Singh

Anirudh Singh

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Wharton MBA Candidate, Fintech Enthusiast, Early Stage Investing