ThinCats, a UK based peer to peer lending platform focusing on SMEs, has been acquired by European Specialty Finance (ESF) Capital. The purchaser has taken a 73.4% of the firm. ESF’s CEO, John Mould, has been appointed as CEO of ThinCats with overall responsibility the direct lending platform. Former CEO and founder Kevin Caley is said to remain “instrumental in the future of the business as Chairman with responsibility for innovation and Peter Brown retains his post as Finance Director”. ThinCats (the opposite of “Fat Cats” as in bankers) has originated over £140 million in P2P loans since its founding. ESF seeks to enhance the ThinCats’ “proposition” for both lenders and borrowers through technology and marketing resources, product development, and additional staff. ESF is also providing underwriting and lending capital to accelerate loan growth.
ESF was founded in July 2015 and is described as a “P2P investment and operating business” backed by US and UK institutions. ESF is providing acceleration capital in the form of strategic and operating resource, investment capital, and speciality lending capital and is focused on the SME market in Europe.
The acquisition is intended to accelerate platform growth. ESF invests in, and underwrites the loans on, various European P2P platforms. ThinCats and ESF have been working together for a number of months and have a created a plan to accelerate ThinCats’ market presence. ThinCats’ focus on private investor funding of UK businesses will remain a cornerstone of the ongoing business. The ThinCats platform will be revamped and new products will be released to better serve the SME market.
“Over the past five years, ThinCats has become highly valued by a network of hundreds of experienced DIY investors who bring a unique ‘crowd due diligence’ to the platform in return for market-leading interest rates,” stated Caley. “This investment by ESF is the fuel we need to take the ThinCats platform up a gear, to retain and extend this core lender base and to attract a broader range of investors. It’s a big step forward for the platform, and will allow ThinCats to cement its place as one of the UK’s big four peer to peer providers.”
“The injection of capital and expertise we are bringing to the platform from ESF will focus on strengthening these foundations, pushing loan sizes higher, and developing both products and platform to attract a wide range of investors. The peer to peer lending industry is truly coming of age, and today one of the longest of tooth gets a little sharper,” stated Mould.
ESF is taking majority and minority stakes in P2P lending platforms. ESF is working with a “range of institutional investors” on direct investment in these businesses and investment in their loan portfolios.