SecProbe.io

March 30, 2020
Dave Girouard
Chief Executive Officer
Upstart Holdings, Inc.
2950 S. Delaware Street, Suite 300
San Mateo, CA 94403
Re:Upstart Holdings, Inc.
Draft Registration Statement on Form S-1
Submitted March 4, 2020
CIK No. 0001647639
Dear Mr. Girouard:
            We have reviewed your draft registration statement and have the following comments.  In
some of our comments, we may ask you to provide us with information so we may better
understand your disclosure.
            Please respond to this letter by providing the requested information and either submitting
an amended draft registration statement or publicly filing your registration statement on
EDGAR.  If you do not believe our comments apply to your facts and circumstances or do not
believe an amendment is appropriate, please tell us why in your response.
            After reviewing the information you provide in response to these comments and your
amended draft registration statement or filed registration statement, we may have additional
comments.
Draft Registration Statement on Form S-1
Prospectus Summary
Overview, page 1
1.Please revise your discussion of revenue on page 2 to clarify that referral fees are charged
to banks when loans are originated and not when consumers apply for a loan.
2.We note your disclosure on page 1 that "[s]ince inception, [y]our bank partners have
originated almost 450,000 personal loans that have generated more than 5.5 million
repayment events."  Please provide quantitative disclosure regarding the number of
deliquency events and loan defaults, if such amount is material.  Similarly, we note your
disclosure on page 2 that none of your loan servicing fees are contingent on credit
performance.  Please balance this disclosure by clarifying that, although you charge loan

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holders a fixed percentage servicing fee based on the outstanding balance of the loans
serviced, if you subcontract the collection of the loan to a loan collection agency, which
you disclose that you do for all loans more than 30 days past due, the costs incurred could
exceed the servicing fee charged.  In addition, clarify here that if you are unable to collect
the amount owed, it could lead to a charge-off of the debt, which could decrease the fees
payable to you.  In this regard, we note your disclosure on pages 34 and 35.
3.Please disclose the number of "bank partners" here, and provide a brief summary of the
material terms of your agreements with your bank partners, including the duration of the
agreements and whether your bank partners have an obligation to issue a certain
amount of loans via your platform or AI services.  Also, revise elsewhere in your
prospectus, such as in your business section, to describe in greater detail the material
terms and conditions of these agreements, including the material obligations of the parties,
the duration of the agreements and the termination provisions.  In addition, please describe
your "network of institutional investors" here and in your business section, including any
agreements you have with such investors.
4.Please disclose here quantitative information regarding the portion of loans originated by
Cross River Bank on your platform in 2019 and the percentage of revenues that you
received from Cross River Bank in 2019.
5.We note your disclosure in the prospectus summary stating that your AI lending platform
expands access to affordable credit.  Please disclose the type of credit your platform
currently offers by disclosing here that your platform offers unsecured personal loans
ranging from $1,000 to $50,000 in size and at APRs typically ranging from approximately
6.5% to 35.99%.
6.In the fourth full paragraph on page 2, please clarify that in addition to loans being
retained by the issuing banks or purchased by you for immediate resale to institutional
investors, you may purchase and hold loans.  Please provide quantitative disclosure here
for the aggregate percentage or dollar value of loans in each of these three categories.
7.We note your disclosure on page 2 that, for pools of securitized loans, your realized loss
rates were approximately half of those predicted by Kroll.  Please provide quantitative
disclosure regarding the realized loss rate.
8.Please describe in the summary the roles of your warehouse trust special purpose entities
and your warehouse credit facilities, including outstanding balance information.
Our Ecosystem, page 6
9.We note your disclosure on page 7 regarding the Net Promoter Scores for your bank
partners' lending programs.  Please disclose whether the 80 rate is the average of all your
bank partners, and clarify, if true, that the scores of the published benchmarks of
other banks may not be comparable to the Net Promoter Scores you disclose because the
other banks did not use the same rating system that your bank partners used.  In this

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regard, we note that you "used a third-party service to administer surveys to loan
applicants immediately following an applicant's acceptance of a loan on Upstart's
platform."  Also, please describe how you determined "the hypothetical loss rates and
approval rates of your funded borrower base to determine that your model could enable
banks to lower loss rates by almost 75%."
Value Proposition to Consumers, page 6
10.We note your disclosure that in the fourth quarter of 2019, approximately 70% of Upstart-
powered loans were instantly approved with no document upload or phone call required,
an increase from 0% in late 2016.  Please revise to explain the underlying reasons for the
increase.
Our Competitive Strengths, page 7
11.We note your disclosure on page 8 that, in September 2017, you received a no-action
letter from CFPB.  Please explain the significance of the letter in the context of your
offering. In doing so, please briefly summarize the issue you raised in your letter to CFPB
and the issue that CFPB stated that it would not recommend for supervisory or
enforcement action as well as the date the no-action letter will expire.  In addition, please
balance this disclosure by disclosing here that in February 2020, you received a letter from
members of the U.S. Senate asking questions in connection with claims of discriminatory
lending made by an advocacy group.
Risk Factors
Risks Related to Our Business and Industry
In connection with our loan funding programs, we make representations, page 35
12.We note your disclosure that, in connection with your loan funding program, you may be
required to repurchase the underlying loans if your representations and warranties were
not accurate when made and that "[s]uch repurchases could be limited in scope, relating to
small pools of loans, or significant in scope, across multiple pools of loans."  Please revise
to disclose quantitative information regarding these potential repurchases so that investors
understand the scale of the risk disclosed in this risk factor.
We are exposed to geographic concentration risk, page 38
13.We note your disclosure that "the geographic concentration of loans originated by
[y]our bank partners through [y]our platform may expose [you] to an increased risk of loss
due to risks associated with certain regions."  Please identify these regions.
Selected Consolidated Financial and Other Data
Contribution Profit, page 85
14.We note your disclosure quantifying borrower acquisition costs as well as borrower
verification and servicing costs.  Please enhance your disclosure to describe the

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underlying reasons for the increase in these costs and discuss any trends.  In addition, for
each period presented, please revise to disclose your average borrower acquisition cost per
loan along with a discussion and analysis of trends.
Management's Discussion and Analysis of Financial Condition and Results of Operations
Overview, page 86
15.We note your discussion of “higher approval rates” throughout the filing.  Please revise to
disclose the approval rate for your unsecured personal loans for each period presented.
Provide accompanying disclosure explaining the underlying reasons for any significant
fluctuations or trends.
16.Please expand your disclosure describing your unsecured personal loans to include the
terms (maturities) of these loans as well as the typical payment terms and conditions. In
addition, please disclose the weighted average term, weighted average APR, weighted
average referral and platform fee received per loan and contribution margin per loan.  In
connection with these disclosures, please also provide appropriate discussion and analysis
of any significant changes or trends.
17.We note your disclosure on page 87 of the percentage of loans in the fourth quarter of
2019 retained by your bank partners, the percentage purchased by institutional investors
through your loan funding programs and the percentage funded through your balance
sheet.  Please revise to disclose this information in a tabular format for each period
presented and discuss any trends.
Our Economic Model, page 87
18.Please revise your disclosure to clarify, if true, that you do not charge borrowers any
transaction fees for the loan matching services through the platform.
Components of Results of Operations
Platform and Referral Fees, Net, page 91
19.We note your disclosure on page 90 that referral fees are charged on a per borrower basis
upon origination of a loan, net of any fees charged by the originating bank back to Upstart
for services provided related to the origination process.  We also note your disclosure on
page F-20 that the Company pays fees on the loans that it buys to compensate the bank
partners for originating the loans and that these fees are included as a reduction to
platform and referral fees.  Please revise your disclosure to quantify and describe the
different fees charged by the originating banks back to Upstart that are included in referral
fees, net.  In addition, please clarify whether both disclosures noted above are referring to
the same costs.
Liquidity and Capital Resources, page 99
20.We note your disclosure on page 24 regarding the risk that worse than expected

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performance of certain pools of loans underpinning your asset-backed securitizations or
other debt facilities could reduce or terminate your access to funding from institutional
investors.  Please revise to provide quantitative information to allow an investor in your
offering to understand the performance of the loans underlying your funding programs.
Business, page 111
21.Please revise your business section to disclose the material terms of your agreements with
Cross River Bank and Credit Karma.
22.We note your disclosure regarding your variable interest entities.  Please provide detailed
disclosure describing your agreements with such entities so that investors understand your
obligations to such entities and the risks associated with such entities.  In addition, please
file the agreements with such entities as exhibits to your registration statement or tell us
why you believe this is not necessary.
Consumer Marketing, page 123
23.Please revise to quantify, in tabular format, the source of consumers for each period
presented and discuss any trends.
24.Please revise to disclose, in tabular format, the percentage of consumers derived from
Credit Karma and any other individually significant source for each period presented and
discuss any trends.
Institutional Investors, page 124
25.Please revise to quantify, in tabular format, the source of significant amounts of volume to
your funding programs for each period presented and discuss and trends.
Consolidated Financial Statements
Consolidated Statements of Operations and Comprehensive Loss, page F-5
26.Please revise your income statement presentation to present interest income, interest
expense and net fair value adjustments separately on the face of the income statement.
Notes to Consolidated Financial Statements
Note 1. Description of Business and Signficant Accounting Policies
Noncontrolling Interests, page F-10
27.We note $4.6 million of net losses were attributed to non-controlling interests in 2019.
Please revise to disclose the attribution of income or loss to each specific VIE that has a
non-controlling interest to allow an investor to more clearly understand the entities and
activities that have resulted in the losses.

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Net Loss Per Share Attributable to Common Stockholders of Upstart Holdings, Inc.
Stockholders, page F-16
28.We note you use the two-class method to compute net loss per common share when shares
are issued that meet the definition of participating securities.  Please revise the notes to
your audited financial statements to include the information required in ASC 260-10-50-1,
as applicable.  Alternatively, tell us why these disclosures are not required.
Recently Issued Accounting Pronouncments, page F-19
29.Please revise to clearly disclose the date you plan to adopt each recently issued or revised
accounting standard.
Note 2. Revenue
Interest Income and Fair Value Adjustments, Net, page F-22
30.Please revise to separately disclose the amount of interest income and fair value
adjustments, net that related to consolidated securitization trusts for each period presented.
Note 3. Securitizations and Variable Interest Entities, page F-23
31.We note your disclosure that 2017-1 and 2017-2 were deconsolidated in December 2019
due to the expiration of the risk retention requirements.  Please revise to disclose the
specific risk retention requirements that expired.  Additionally, please revise MD&A to
include information regarding the potential for similar reconsideration events that could
lead to the deconsolidation of entities in the future.
32.We note your disclosure on page F-25 that the fractional loan program was formally
discontinued in 2019 leading to the deconsolidation of the Upstart Network Trust.  Please
tell us in detail and revise your disclosure to include an enhanced discussion explaining
how this event resulted in the company no longer expecting to absorb more than an
insignificant amount of UNTs expected losses or returns and the ultimate deconsolidation
of the Trust.  Please tell us the specific authoritative literature to support your conclusions.
33.We note your disclosure on page F-24 that for securitization transactions 2017-1, 2017-2
and 2018-1 the Company determined that it was the primary beneficiary of these entities
and consolidated the MOAs and associated trusts.  We also note your disclosure that for
securitizations 2018-2, 2019-1 and 2019-2, while the company determined it was the
primary beneficiary, and consolidated the MOAs associated with these securitizations,
they determined they were not the primary beneficiary of the associated trust that holds
the loans and therefore did not consolidate it.  Please tell us in detail and revise your
disclosure to explain the key differences in these securitization structures that resulted in
different consolidation conclusions with respect to the trust that holds the loans.  Please
tell us the specific authoritative literature to support your conclusions.
34.Please revise to your table on page F-25 presenting financial a