Renaud Laplanche, CEO & Co-Founder of Upgrade — Launching the Fastest Growing Card in the US

In today’s episode, Anirudh Singh sits down with Renaud Laplanche, CEO and Co-Founder of Upgrade.

They discuss:

Renaud’s Motivation for Starting Upgrade:
Prior to founding Upgrade, Renaud founded fintech pioneer, Lending Club. The company went public in 2014 with a $10Bn market cap. While many would have been satisfied with this accomplishment, Renaud had a sense of “unfinished business” and left Lending Club in 2016 to found Upgrade. From his success at Lending Club, Renaud knew he could build a large credit business without a large balance sheet, but believed that Lending Club remained a “mono-line” business for too long, and had numerous unique product offerings he still wanted to bring to market. Enter Upgrade.

Upgrade’s Unique Product Offerings:
Upgrades products include:

• Upgrade Card: Renaud sees a fundamental issue with current credit card offerings — traditional credit cards encourage monthly minimum payments that allow interest to accrue and end up costing customers significantly more than the initial purchase. With the Upgrade Card, Upgrade’s flagship product, Renaud hopes to create a consumer-friendly card that lets consumers access credit when they need it, and later develop a monthly installment plan that creates forced discipline. The card recently became the fastest growing card in the United States and includes a bitcoin rewards feature, allowing users to dip their toes into the crypto space without taking on significant financial risk.
• Debit Card: Renaud felt that there was a gap in debit card offerings for mainstream consumers in the market. Upgrade’s customers, who are on average in their late 30s and early 40s, aren’t particularly swayed by early paycheck features. They look for different types of value from their banking relationship. Therefore, Upgrade decided to offer up to 2% rewards on its debit card, essentially passing on all interchange revenue in order to build stronger and healthier relationships with its customers.

Renaud believes that the company is riding a similar wave as the Buy-Now-Pay-Later boom; consumers have realized that credit cards can have negative side effects and are looking for an alternate solution. Installment payments, whether through the Upgrade Card for large purchases or through a BNPL plan for smaller purchases, help keep rising interest costs in check.

What Renaud Looks for in a VC Partnership:
Renaud aptly points out that he looks for different characteristics from his venture capital partnerships depending on the stage of his company:

• Early stage: Renaud values the VCs network and ability to help hire top talent. VCs he’s worked with in the past have a central recruiting function to help their portfolio companies.
• Later stage: In the later stage, Upgrade and Lending Club found it easier to attract talent on their own. Instead, they looked for access to capital and the ability to build commercial & banking partnerships.

Taking a Company Public:
When asked about the right time to take a company public, Renaud points out the difference between being ready to go public vs. being ready to be public.

“A lot of people focus more on the IPO itself and not so much on whats after. It’s a bit like the wedding reception, it’s the fun part but then after that there’s a marriage which can be fun too, but it takes work. To really operate as a successful company there is an element of size and profitability that is quite obvious. But the functions of the company have to be more mature than what you expect from a private company, especially in a regulated field like fintech and banking.”

He also discusses lessons learned from taking Lending Club public and his high-level plans for Upgrade.

Rapid Fire Round:

• Favorite book?
• Favorite Drink?
• What time of day are you most productive?
• What subject were you worst at in school?
• What was the best piece of advice you were given on the job?
• What advice would you give your younger self?

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Renaud Laplanche
Renaud is the co-founder and CEO of Upgrade, Inc. a neobank that offers affordable and responsible credit to mainstream consumers. Under his leadership, Upgrade has reached profitability and a $3Bn+ valuation within 4 years of launch.
Prior to Upgrade, Renaud founded and ran Lending Club for 10 years. He took the company public, reaching a market capitalization of $10 billion in December 2014. At Lending Club, Renaud pioneered consumer fintech and grew the company to become the largest provider of personal loans in America.
Renaud was ranked #23 in Bloomberg Markets’ 2015 Most Influential List, an annual ranking of the World’s top 50 most influential leaders across technology, finance, and politics. He was also recognized at the Clinton Global Initiative by President Clinton for expanding access to affordable and responsible credit. In 2014, he won the Economist Innovation Award in the consumer products category and was named the “best start-up CEO to work for” by Business Insider. Renaud was named “Fintech Executive of the Year” by Finovate in 2020.
He also holds the Newport-Bermuda world speed sailing record.

About Upgrade
Upgrade is a neobank that offers affordable and responsible credit to mainstream consumers through personal loans and cards, together with credit monitoring and education tools that help consumers better understand and manage their money. Over $7 billion in loans and cards have been originated by the Upgrade platform since its inception in 2017. Upgrade is headquartered in San Francisco, California. More information is available at: www.upgrade.com.

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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.