Lightbank and Internet Pawn have announced that they have partnered to launch a new site called Pawngo.com, aimed at "reinventing the pawn shop". In case you've never heard of either of these companies, Lightbank is an investment firm run by two founders of Groupon - Eric Lefkofsky and Brad Keywell. Groupon, as you may know, recently filed for its IPO.
Lightbank has led a $2.3 million Series b round of funding for Internet Pawn, which is rebranding itself as Pawngo. It's also backed by Daylight Partners and Access Venture Partners. PawnGo says it is co-headquartered in Denver and at Lightbank's offices in Chicago.
"Particularly in today's economy, many people often find themselves in a bind and need short-term capital to overcome some obstacle they're facing," said Todd Hills, co-founder and CEO of Pawngo. "With the investment, support and expertise of Lightbank, we're now able to bring this practical and more affordable financing option to consumers on a broad scale."
To use the service, consumers simply go to the site, enter a description of an item with a digital image and contact info (no credit details or social security numbers), and Pawngo will make a preliminary loan offer or buy estimate within a few hours. If the user accepts the offer, Pawngo lets you print an overnight FedEx shipping label to send the items directly to its "evaluation lab". They also make boxes and packing materials available.
When they receive the item, the company will contact the user with an evaluation and detailed offer. If it's accepted, they wire the money immediately.
Hills says that while some may view pawning as a last resort, it can be a "much more prudent form of borrowing" compared to alternatives. "Especially in the current tight credit market, why go into debt and put your financial future at risk with a conventional loan or credit cards?" he said. "Instead, our system lets you use the items you already own to get a loan that won't get you into trouble down the road."
The company says that it has loaned over $1.35 million in 46 states to date. It has previously operated under not only the Internet Pawn brand, but also Boomerang Lending. PawnGo says its company mission is to "get you cash when you need it without any hassle and without the risk of going into debt."
Pawngo doesn't check credit history or financial history. "We won’t bother you if you don’t pay," the company promises. "We won’t report you to credit agencies, ever. Our customer service will be beyond your wildest expectations, always." It also "guarantees" that its loan or buy offer for items will be better than any other pawn shop, online marketplace and online buyer of pre-owned merchandise.
That's quite a guarantee.
The founders of PawnGo claim to have over 25 years experience owning and operating over 50 pawnshops.
What do you think? Is there big demand for a new online pawn service of this kind?