SoLo Funds, a payday loan alternative for mobile devices that provides emergency cash loans of $1,000 or less, has moved the company’s headquarters from Cincinnati to downtown Los Angeles.

The company is preparing to raise $15 million in a Series A round and made the move to a temporary L.A. office while it searches for a permanent spot, possibly in Culver City.

Listen to GHOGH with Jamarlin Martin | Episode 11: Travis Holoway Jamarlin talks to Travis Holoway, founder and CEO of SoLo Funds, a startup focused on peer-to-peer lending. They discuss Mark Zuckerberg as a liberal tech version of Donald Trump, Jake Tapper’s double standards on CNN towards Black leaders, and whether Silicon Valley has “negro helpers” who set the community back.

The move was predicated on attracting talent to the company, SoLo co-founder Travis Holoway said, according to a report in LA Business Journal.

With credit scoring technology built into its platforms, person-to-person lenders like SoLo could potentially undercut the multibillion-dollar payday loans industry, said Rodney Ramcharan, an associate professor of finance and business economics at USC’s Marshall School of Business, in an L.A. Business Journal report.

SoLo funds has raised $3 million in the last year including a $1.2 million venture round led by Richelieu Dennis, owner of Essence Magazine and founder and CEO of Sundial Brands.

Most Americans live paycheck to paycheck and almost half couldn’t come up with $400 of emergency cash without borrowing from someone or selling something, according to the SoLo website.

Holoway was working as a financial advisor for Northwestern Mutual in New York City when he learned that payday lenders typically charge 400 percent-or-so interest. Customers often end up deeper in debt, and Black communities are especially vulnerable. Fed up with helping wealthy people get wealthier, Holoway did something about the problems faced by the 70 percent of Americans.

He built SoLo Funds around a market that was being ignored.

Since its April 2018 launch, SoLo has completed about 10,000 loans for more than 85,000 registered users, according to LA Business Journal.

Anyone can lend and borrow on the SoLo app. Borrowers don’t pay interest. Instead, they agree to terms with the lender to repay within 30 days the principal plus a so-called tip — a premium on top of the loan amount. SoLo can get a cut of the payback in loaned money if the borrower OKs it – called a donation. Tips and donations are voluntary. Tips made by borrowers to the lenders average about 8 percent of the loans. Donations amount to about 3 percent, Holoway said. He declined to say what percentage of borrowers received loans without offering a tip or a donation, accoring to LA Business Journal.

Other fintech startups in the peer-to-peer loan space include Santa Monica-based Tala; Irvine-based microinvestor Acorns Grow Inc.; billionaire Mark Cuban-backed Dave Inc., located in the Miracle Mile; San Francisco-based nonprofit lender Kiva Microfunds; and Hollywood-based ZestFinance Inc.

“These companies operate in a gray zone in the banking world without having to provide much in terms of registration with or licensing by state and federal regulators because they do not technically charge interest or fees for their services,” Pat Maio wrote for LA Business Journal.

The business model is so new, it’s not clear if they need a license, said Mark Leyes, a spokesman with the California Department of Business Oversight. “Some of these novel lending products do require further investigation,” Leyes said.

In addition to Dennis, SoLo Funds has the backing of Culver City-based Cross Culture Ventures; Boulder, Colo.-based Techstars Central, a seed investor in startups; Cleveland-based business mentoring firm JumpStart Inc.; and Joanna Rees, who founded Venture Strategy Partners and VSP Capital in the Bay Area; and Monique Idlett-Mosley, managing partner of Miami-based Reign Ventures, an early stage venture capital fund.

SoLo Funds co-founders include Lisnr co-founder Rodney Williams, htt Jarrel Carter, and Taylor Conophy.

“We understand how difficult it is to get a loan under $1,000 and the trouble of living with financial stress, because we’ve lived it ourselves,” the founders say on their website. “We realized that we weren’t alone.”

A round with a $15 million target is planned for June, the founders said.