Business Models in Lending-Based Crowdfunding Industry

Lending-Based Crowdfunding (LBCF) facilitates the matching of credit demand and supply through a specific marketplace, managed through online platforms. In recent years, the LBCF phenomenon has been analysed from different perspectives. In particular, many studies focus on lenders’ and borrowers’ behaviour, companies’ operating mechanisms and network effects, since these are widely considered to be critical points for the growth and stability of market operators.However, there has been little discussion about the strategies and business models adopted by LBCF companies. The aim of this study is to arrive at a more insightful categorization of LBCF companies’ business models by simultaneously considering, in addition to their intermediation function, their strategic choices concerning customer segments (borrowers and lenders) and the additional services they provide. Specifically, we identify four main business models in the LBCF industry: diversified, business specialized, consumer specialized and peer-to-peer. This classification provides a more effective, realistic description of LBCF companies’ strategies at a global level and can be a useful tool for future analysis on the performance of LBCF companies, as well as for their market positioning and for benchmarking their activities.