ESF Capital, along with its operating subsidiary ThinCats – a secured peer to peer lending platform, reports it has concluded a funding program for loans of up to £5m for growing UK small and medium-sized enterprises (SMEs).
The new £200 million funding program comprises £30 million already committed by ESO Capital, £70 million from Waterfall Asset Management, and the balance to be provided by Waterfall and other institutional investors, subject to certain conditions. All funds under the program will continue to be invested in loans originated through ThinCats. The addition of institutional funding will help scale ThinCats loan originations.
The company explains that alongside existing ThinCats lenders, these new investors allow ThinCats to provide certainty of funding to a diverse set of SMEs in more significant amounts. The company says that lending will focus on funding growing companies with asset backing and reliable cashflows, including acquisition finance, across all regions and sectors in the UK.
“This additional investor base will allow us to significantly increase funding for small businesses’ expansion, acquisition or refinancing plans,” stated Damon Walford, ThinCats Chief Development Officer. “Our focus on providing amounts up to £5m based on assets and reliable cashflows means we occupy a space where traditional providers ‘can’t work’ rather than ‘won’t work’. We have built an impressive team to service the market focussed on working alongside professional intermediaries to source opportunities and this funding ensures we are able to provide certainty to borrowers and their advisers. This is a significant stage in the continued development of our business, which we plan to significantly increase over the next two years and we are excited by what the future holds.”
Henrik Malmer, Managing Director at Waterfall, said that ThinCats occupies a unique space in the market. Malmer called the investment a positive addtion to their portfolio.
ESF’s Managing Director, Ravi Anand, added
“ESF has engaged across the institutional market and this is the first key initiative in our plans to provide significant funding to the UK SME market. Generating a strong and sustainable yield from providing finance for small and growing businesses is a compelling alternative to traditional fixed income investments when combined with the funding gap left by conventional lenders.“