MPower Financing announced plans this week to raise $100 million that will help fund student loans for international students and others who are left out of traditional lending.
The Dupont Circle–based company is seeking debt funding that will finance the student loans. It’s separate from an equity raise that would fund hiring and other growth at the startup, said cofounder Mike Davis.
The debt fundraising round, which is in progress, is a response to demand for the company’s loans, and Davis believes the added funding can help finance loans for about 5,000 students.
The new round comes on the heels of a move to partner with Bank of Lake Mills that made MPower Financing’s loans available in all 50 states, and a total of 223 institutions.
Founded in 2014, the company provides loans to international students and others who don’t fit traditional credit criteria, as Technical.ly DC reported. It’s structured as a B-Corp, so investors are putting money in hopes of a fiscal return as well as having an impact on students. The loans are also designed to help the international students establish credit for life after college.
“MPower helps them build that credit in a way that doesn’t treat them as second class citizens,” he said.
Along with the new round, MPower said Davis is stepping into the role of Chief Investment Officer. He said it will allow him to focus on the new and more sophisticated types of financing strategies that come with raises like a $100 million debt round, as well as building relationships. The company is also opening an office in New York’s financial district, where Davis will be based.-30-