Three P2P pioneers take stock at 30

Shared philosophy

A shared philosophy and confidence in RenRenYouXin's management team is the major reason for such an efficient investment, according to Yang. TBP's Li said the air was electric after Zhang Shishi, one of the co-founders, finished his speech at a news conference and gave the floor to Li. "It wasn't so much the big deal but perhaps the more trivial things that indicated Zhang is a man of specifics, accuracy and strict methods - exactly what the financial industry needs," he said.

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Unlike companies that will usually raise the rate of business expansion after fundraising, RenRenYouXin is going to slow down the growth this year. "A solid and balanced growth is critical for financial enterprises, which is particularly true in the fast-growing P2P sector," Yang stressed.

Although China's P2P sector witnessed robust growth last year, quite a number of lenders encountered operational problems because of increasingly fierce competition. According to www.wangdaizhijia.com, 74 P2P lenders went bankrupt or encountered capital chain problems in 2013, with 1.5 billion yuan from investors overdue for repayment.

RenRenYouXin's fund will be used to cultivate talent and optimize products, to boost risk management and to make strategic mergers and acquisitions at an appropriate time, Zhang said.

"Once we consolidate our base, we are confident of seeing an annual transaction value exceeding 10 billion yuan within five years," said Yang.

In 2013, renrendai.com saw transactions totaling 1.57 billion yuan, up 342 percent over 2012. The average bidding interest rate stood at 13.07 percent. "We plan to double our transaction value this year," said Yang, adding the "conservative" target would allow for better development in the future. He said that to survive is much more important than trying to zoom ahead.

Because the central bank's payment clearing department is very likely to be in charge of regulating the fast-growing P2P industry, the policy risks have been largely reduced. Therefore, more venture capital is expected to enter the sector, further strengthening competition. According to Yang, Lufax.com, part of Ping An Insurance (Group) Co of China Ltd, is the biggest rival of renrendai.com. Other major players include paipaidai.com, yooli.com and itouzi.com.

The ambition of RenRenYouXin, however, is not confined to being a mere online platform matching lenders with borrowers. In 2012, the three young men set up Shanghai You Credit Co Ltd, which is an offline company aimed at finding qualified borrowers and double checking their financial status. "It involves gathering credit information about small borrowers. Producing data based on that will provide huge business opportunities in the future," said Yang.

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