One of the leading UK-based Fintechs LendInvest is now a publicly-traded firm. LendInvest’s shares commenced trading on the London Stock Exchange’s AIM market today in an initial public offering (IPO). Shares are trading under the ticker symbol “LINV”.
As was previously reported, LendInvest will raise approximately £40 million at a £255.6 million valuation. In a corporate statement, LendInvest said it had attracted strong support for its IPO from high-quality institutional investors with an offer price of 186 pence.
Rod Lockhart, Chief Executive of LendInvest, issued the following statement on the IPO:
“Listing in London today is the next landmark in our growth journey. I’d like to thank each and every member of the team at LendInvest who made this incredible achievement possible. We are hugely excited about the future for LendInvest. The capital that we have raised through this IPO will enable us to accelerate our technology roadmap, expand into new areas of property finance, and attract new investors, brokers and borrowers to our platform. We’re delighted to welcome a great group of investors today, and we look forward to delivering for them on the next stage of our journey. We set out to make property finance simple, and today’s IPO is an important milestone in our journey towards achieving that goal.”
LendInvest is a property finance platform that provides short-term financing and buy-to-let (BTL) loans to developers in the UK. As of March 2021, LendInvest reported £1.6 billion in assets under management (AUM) and adjusted EBITDA of £12.1 million. Even during a challenging environment due to the COVID-19 health crisis and a short closure of property markets in 2020, LendInvest has persevered and grown. Profit from operations was reported at £9.3 million as of March 2021 versus a profit of £600,000 in 2020.
LendInvest’s growing relationships with institutional investors have been key to its growth. In June 2021, LendInvest priced the company’s third securitization of £280 million of UK prime BTL mortgage loans in an RMBS offering that was said to be oversubscribed. LendInvest completed its first securitization of BTL loans in 2019 which was also a first for a Fintech in the UK.
The total addressable market for LendInvest is estimated at around £300 billion in originations annually and thus the company has significant room to grow. The company believes that opportunities for growth include the specialist homeowner and consumer buy-to-let segments where the process continues to be largely paper-based.
Founded in 2008 (originally named Montello) by Executive Chairman Christian Faes and Chief Investment Officer Ian Thomas, LendInvest started life as an analog business but soon transitioned to a digital origination process for property finance. The company’s website states that their “mission to make property finance simple. As a result, technology underpins everything we do. We have built an asset management platform designed to make the process of getting a mortgage simpler: reducing the form-filling, increasing the speed to get a ‘yes’, and creating a better customer experience for our borrowers, intermediaries, and investors.”
In a blog post from today, Lockhart stated that LendInvest was created to fill a critical gap in the property finance market:
For decades, it’s been a market dominated by traditional banks, characterised by rigid products, poor customer experience and manual, paper-based processes. We believe that the property finance market in the United Kingdom is one of the few remaining verticals in the UK financial services sector that is yet to be disrupted by technology.
To us, the answer to this problem was clear: to create a new property finance platform, one that gives customers the speed, simplicity and certainty that they want. With every loan, every new product and every year we’re showing borrowers and investors what the mortgage market should look like.
The UK has long been a top global Fintech hub and LendInvest represents one of the best platforms to have emerged from this entrepreneurial center for innovation in financial services. In retrospect, LendInvest’s service may appear obvious but it took risk-taking entrepreneurs to challenge incumbent financial services firms to offer a property finance process far better. While noting that the IPO is the culmination of years of effort, Lockhart said the listing on AIM is just the beginning for LendInvest.
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