CrowdProperty, a property peer to peer lender, has closed its pre-series A equity crowdfunding round at £907,467 or 150% of the funding target. The campaign listed on Seedrs attracted 509 investors investing an average of £1,783. CrowdProperty offered a 9.23% ownership stake in the company at a pre-money valuation of £5.9 million. The campaign reportedly hit 100% of the target funding (£600k) within 40 hours of launch.
“We are delighted about the £900k raise and in particular the speed, showing both strong confidence in what we are doing from the crowd of investors and also enabling us to crack on with the next phase of the CrowdProperty journey,” commented Simon Zutshi, CrowdProperty CEO. “We had planned for a successful raise as we have achieved a lot to prove our profitable concept and therefore strongly believe in the investment proposition that we offered the crowd. We planned to allow the campaign to go into overfunding as we know that extra funds can be used valuably to grow the business faster.”
The additional money will fund investment in new hires, tech development and marketing to deliver on the expansion potential for peer to peer platform. CrowdProperty has received full FCA authorisation and has recently lent over £10 million in originations.
“I’d like to thank previous and new investors for their ongoing support and also our customers – both lenders and borrowers – for helping us to help them,” added Zutshi.
Founded in 2013, CrowdProperty provides loans between private individuals and UK professional property businesses with a database of over 6,000 registered users. CrowdProperty says it has unique proprietary access to the largest property network in the UK, the Property Investors Network, which provides a competitive advantage in terms of high quality deal origination and has enabled the proof of the business with limited marketing investment to date.
After facilitating 27 projects, CrowdProperty now says it is increasing momentum. The two most recent projects leading up to the crowdfunding round fully funded £910,000 in 41 minutes and £490,000in 17 minutes respectively.
CrowdProperty reports that it is already profitable with more favourable economics than peer to peer platforms in consumer and SME marketplaces owing to shorter average loan lengths, higher average loan sizes, borrower frequency/retention and achievability/sustainability of fee levels.
Revenue run-rate performance including contracted end of loan cash-flows for open loans is £820,000 with £580,000 net profit run rate based on annualising the last 3 months performance (£740,000 and £490,000 annualising the last 6 months).
CrowdProperty says it wants to become the market leader in project-based finance direct to SME property professionals whilst simultaneously providing competitive first-charge secured returns to its retail pool of lenders.
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