Pandit-Backed CommonBond Said to Cut Capital Markets Chief Starrby
CommonBond Inc., the student-loan venture backed by Vikram Pandit, cut 10 people including its head of capital markets hired just six months ago, according to people with knowledge of the matter.
Beth Starr, who joined the firm in January to help build ties with Wall Street and develop other funding sources, was among the group let go this month amid a restructuring designed to control costs, said the people, asking not to be named because they aren’t authorized to speak publicly. Starr was formerly a managing director at Lehman Brothers Holdings Inc. and Jefferies Group LLC.
CommonBond’s Chief Financial Officer Morgan Edwards is now overseeing its capital markets efforts, said one of the people.
Often called marketplace lenders, the companies grew rapidly in recent years but have been finding it harder to attract investors, a difficulty exacerbated last month after industry pioneer LendingClub Corp. said it had discovered problems with its internal controls, and that its chief executive officer and founder was stepping down. Prosper Marketplace Inc., one of the largest U.S. online lending platforms, is slashing its workforce by 28 percent.
Starr didn’t reply to requests for comment. A CommonBond representative declined to comment.
CommonBond is among dozens of financing startups to attract institutional investors’ interest. The company primarily refinances high-quality student debt, and aims to fund the business more efficiently by using technology to match borrowers with investors. Since leaving Citigroup Inc. as chief executive officer, Pandit, 59, has helped back new businesses looking to challenge traditional banks. In 2013, he was among investors to inject $100 million into CommonBond.