Assetz Capital is going to the crowd to finance its young peer to peer lending platform. Led by CEO and co-founder Stuart Law, Assetz Capital is seeking a raise of £2 million in a convertible offer on Seedrs. The offer incorporates a 10% discount on the future valuation of a P2P platform that expects to fund £1 billion by the end of 2016. The valuation cap has been set at £60 million. In the event that the convertible shares are issued after 12 months, the discount rate shall increase by a rate of 0.8% per calendar month for a further 11 months, increasing to 20% in the 24th month. The discount rate will then be capped at 20% thereafter. The offer claims 150 investors today and has quickly passed the mid way point with over £1.1 million committed.
According to their web site, Assetz Capital has 7300 registered investors today and has lent approximately £61 million.
Assetz Capital is in the P2B space – targeting business borrowers with their direct lending platform. This segment of the industry has seen dramatic growth in recent years. According to Nesta, the growth has topped 250% over the past two years alone. P2P in the United Kingdom has benefited from a light touch regulatory approach and consistent encouragement from elected officials. The forthcoming inclusion of P2P assets in ISAs (UK retirement accounts) is widely expected to boost the industry further.
As far as they are aware, Assetz Capital is the “first” secured lending platform and states that to date not investor has lost a single penny from loans on their site. Interest has been paid out in the amount of £2.5 million since the site launched in April of 2013. According to Assetz Capital “Lenders have earned a weighted average gross return of over 10% pa in the last 12 months”.
Victory Park Capital (VPC), an asset management firm focused on middle market debt and equity investments, announced in January of this year that they will invest up to £150 million in loans originated by Assetz Capital under a new five year contract. Assetz Capital has stated they experienced 300% year over year growth in 2014 – something they expect to continue in the near future.
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