- Today’s main news: Better.com raises $160M. Funding Circle passes $10B in global small business lending. Numbrs Personal Finance achieves unicorn status. Tala raises $110M, expanding into India. LendingKart raises $2.95M.
- Today’s main analysis: LendingTree Personal Loan Report–July 2019.
- Today’s thought-provoking articles: Slack’s direct listing and the future of security tokens. Is Funding Circle Holdings’ debt risky? Singapore fintechs on a hiring spree. The most expensive U.S. towns.
- Better.com closes $160 million funding round. Series C round for this mortgage platform with 3x year-over-year growth.
- LendingTree’s Personal Loan Offers Report for July 2019. 67% of loan inquiries were either credit card refinancing or debt consolidation.
- Slack’s direct listing and the future of security tokens. Is there a future for the security token, or is this just another passing fad–like ICOs?
- 50 most expensive towns. Another LendingTree study. It looks like a lot of small towns, not major metro areas.
- Elevate Credit issues quarterly earnings results.
- Reliant Funding celebrates seven years on Inc. 5000.
- Steve Eisman doesn’t like Zillow.
- Is real estate crowdfunding a good investment?
- Fund That Flip raises $11 million in growth financing.
- 3G Capital Advisors facilitates $179.2 million in Freddie Mac loans.
- The Apple Card’s biggest flaw.
- Silvergate Bank to offer crypto lending, files for IPO.
- Fintech takeover spending hits record levels.
- The Ohio college with the most student debt.
- Futures brokerage launches managed futures podcast.
- Funding Circle surpasses $10 billion in small business lending globally. Excellent achievement. Congratulations.
- Is Funding Circles Holdings using debt in a risky way?
- ThinCats to lend 400 million GBP to growth companies by end of 2020.
- Welsh Delio secures 3.3 million GBP.
- UK tech firms attract record 5.5 billion GBP in foreign investment.
- P2P entrants have second mover advantage.
- Banking-as-a-Service outlook.
- Aprao launches development appraisal tool.
- Numbrs Personal Finance achieves unicorn status. Coming out of nowhere. Congratulations!
- Lendable launches fund in Luxembourg with Credit Suisse.
- P2P events in 2019.
- Brocc raises debt financing from Goldman Sachs.
- International: Tala raises $110 million, to expand into India. Tala already has quite a reach with a presence in several countries including the U.S., Kenya, Mexico, and the Philippines. Also notable in this story: The total number of lending and investment funding is $7.2 billion.
- India: LendingKart raises $2.95 million. Congratulations.
- Israel: Fintech regulator is looking at licensing changes.
- Singapore: Fintechs are on a hiring spree.
- Australia/New Zealand: Harmoney hires new CEO.
- India: Top challenges faces by MSMEs.
- Malaysia: CTOS launches SME credit score.
- India: Business loan application process at Ziploan.
- United States
- Better.com Closes Series C at $ 160 Million (BusinessWire), Rated: AAA
- LendingTree Personal Loan Offers Report – July 2019 (LendingTree), Rated: AAA
- Slack’s Direct Listing: The Non-IPO Threat to Wall Street and its Future in Security Tokens (Global Banking Finance Review), Rated: AAA
- Elevate Credit Issues Quarterly Earnings Results (Mayfield Recorder), Rated: A
- Reliant Funding Celebrates Seven Years on the Inc. 5000 (PR Newswire), Rated: A
- Eisman slams Zillow; US Consumer Mixed; 30-Yr Hits Record (PeerIQ), Rated: A
- Is Real Estate Crowdfunding a Good Investment? (Lifehacker), Rated: A
- Fund That Flip raises $ 11 million in growth financing from Edison Partners (Finextra), Rated: A
- 3G Capital Advisors Facilitates $ 179.2 Million in Freddie Mac Loans Between Greystone and Watermark J&L Partners (Yahoo! Finance), Rated: A
- The 50 Most Expensive Towns in America (LendingTree), Rated: AAA
- The Apple Card’s best feature is also its biggest flaw (Business Insider), Rated: A
- Silvergate Bank Announces A Crypto Lending Service In IPO Filing (Coin Revolution), Rated: A
- Planning for LendIt Fintech USA 2020 is Underway (Lend Academy), Rated: A
- Fintech Takeover Spending Hits Record Levels on 2019’s Megadeals (Bloomberg Law), Rated: A
- Ohio College Graduates Struggle With Rising Student Debt (CityBeat), Rated: A
- Futures Brokerage Capital Trading Group Announces Launch of Managed Futures Podcast (PR Web), Rated: B
- United Kingdom
- Funding Circle Surpasses $ 10 Billion Lent to Small Businesses Globally (BusinessWire), Rated: AAA
- Is Funding Circle Holdings Using Debt In A Risky Way? (Yahoo! Finance), Rated: AAA
- ThinCats to lend £400m to growth companies by end-2020 (Growth Business), Rated: A
- Welsh Delio secures £3.3m equity round (Fintech Futures), Rated: A
- UK tech firms attract record £5.5bn in foreign investment (P2P Finance News), Rated: A
- Aprao launches development appraisal tool (PlaceTech), Rated: B
- New P2P entrants have a ‘second move advantage’ (P2P Finance News), Rated: A
- How banking-as-a-service (BaaS) works and industry outlook (Business Insider), Rated: A
- European Union
- Swiss Fintech Startup Becomes a $ 1 Billion Unicorn (Bloomberg), Rated: AAA
- Lendable launches Luxembourg fund with Credit Suisse (AltFi), Rated: A
- Events for every P2P professional’s calendar in 2019 (P2P Finance News), Rated: A
- Brocc raises Debt Financing from Goldman Sachs (MyNewsDesk), Rated: B
- Tala, A Digital Lending Startup, Raises $ 110M, Eyes India For Expansion (Crunchbase), Rated: AAA
- Harmoney earmarks new CEO for NZ, Australian growth (NBR), Rated: AAA
- Lendingkart Secures $ 2.95M From Sistema Asia Fund (PYMNTS), Rated: AAA
- These are the top challenges faced by MSMEs, the growth drivers of Indian economy (Money Control), Rated: A
- Business Loan Application Process: Explained (Ziploan), Rated: A
- Singapore fintechs continue hiring despite economic slowdown (Insurance Business Mag), Rated: AAA
- CTOS LAUNCHES SME CREDIT SCORE TO STANDARDISE CREDITWORTHINESS MEASURE (Digital News Asia), Rated: A
- With 2,000 applications, Israel fintech regulator eyes licensing changes (CoinGeek), Rated: AAA
Better.com Closes Series C at $ 160 Million (BusinessWire), Rated: AAA
Better.com, one of the fastest-growing homeownership platforms in the country, today closed its Series C fundraise at $160 million, bringing the company’s total funding to $254 million to date. Activant Capital, Ping An Global Voyager Fund, Ally Financial, Citi, AGNC, Healthcare of Ontario Pension Plan (HOOPP) and American Express Ventures joined existing shareholders Goldman Sachs, Pine Brook, and Kleiner Perkins in the round.
The new investment round comes amid a period of tremendous growth for the fin-tech disruptor: Better.com has grown 3x year-over-year and is currently funding $375 million in mortgages a month. This puts the company on track to lend over $4 billion in 2019. Better.com also funded $1 billion of loans in Q2 of this year alone, more than in all of 2016 and 2017 combined.
LendingTree Personal Loan Offers Report – July 2019 (LendingTree), Rated: AAA
The most common reasons for seeking a personal loan are credit card refinancing and debt consolidation. These two categories comprise 67% of loan inquiries in July.
Slack’s Direct Listing: The Non-IPO Threat to Wall Street and its Future in Security Tokens (Global Banking Finance Review), Rated: AAA
Removing the middleman through security tokenization also means democratizing access to investment opportunities. By breaking up large assets into individual tokens, exclusive investment opportunities that would otherwise be reserved for the super-rich are opened up. Essentially, security tokenization is doing to private investments what peer-to-peer lending has done to private lending by removing the lock-up, liquidity, and the lower minimum investment involved in traditional venture capital and private equity investing.
As well as tokenized VC investing, it is also becoming possible for a small investor to buy a stake in luxury assets such as a multi-million dollar Manhattan apartment, or a share in a new blockbuster movie or a hit album.
Elevate Credit Issues Quarterly Earnings Results (Mayfield Recorder), Rated: A
Elevate Credit (NYSE:ELVT) released its quarterly earnings results on Monday, July 29th. The company reported $0.13 earnings per share for the quarter, beating analysts’ consensus estimates of $0.07 by $0.06, Briefing.com reports. The business had revenue of $177.76 million for the quarter, compared to the consensus estimate of $187.48 million. Elevate Credit had a net margin of 2.45% and a return on equity of 19.19%. Elevate Credit’s revenue for the quarter was down 3.6% on a year-over-year basis. During the same quarter last year, the firm earned $0.07 EPS. Elevate Credit updated its FY 2019 guidance to $0.55-0.65 EPS and its FY19 guidance to $0.55-0.65 EPS.
Reliant Funding Celebrates Seven Years on the Inc. 5000 (PR Newswire), Rated: A
Today, Inc. magazine revealed that Reliant Funding is number 3,838 on its annual Inc. 5000 list, the most prestigious ranking of the nation’s fastest-growing private companies. The list represents a unique look at the most successful companies within the American economy’s most dynamic segment—its independent small businesses. This is Reliant Funding’s seventh consecutive year the Inc. 5000.
Eisman slams Zillow; US Consumer Mixed; 30-Yr Hits Record (PeerIQ), Rated: A
A year ago the prevailing view was the era of low rates was over. We find ourselves now testing record low 30-year US Treasury yields, and potential issuance of 50-year and 100-year bonds. Mohammed El-Erian is raising the concern that with the panic headlines we might be talking ourselves into a recession.
Steve Eisman, famed for shorting subprime mortgages, took a direct shot at Zillow’s new business model. We highlight the excerpt of Steve’s comments, particularly as a number of FinTechs are entering the market for intermediating residential homes:
Zillow has one of the most flawed business models I’ve seen in a very, very long time.
The part of it I find the most problematic is what they call, I believe, their iHome business, their internet buying business, where they actually go out and buy homes and flip them. I actually think the company doesn’t understand the real risks of this business, which are massive.
Is Real Estate Crowdfunding a Good Investment? (Lifehacker), Rated: A
Ask a rich person how they got rich, and there’s a good chance they’ll say they invested in real estate. In fact, real estate is generally accepted as one of the most solid ways to build wealth.
“It’s not only about access, but also the size of some of these transactions. The average consumer can’t buy a $10 million building, however they can take on a $100 share of it.”
What it costs to make money with real estate investing
For example, CrowdStreet requires a minimum investment of $10,000 for a minimum 36 months, but doesn’t charge account fees. Fundrise lets you get started with $500, but charges a fee of 1% per year, which is relatively steep compared to fees for roboadvisors, which tend to be around 0.25% to 0.60%.
Joseph Hogue of My Stock Market Basics examined average returns on real estate crowdfunding platforms: Open investments had a return of around 14.7%, with completed deals averaging 14.6%.
Fund That Flip raises $ 11 million in growth financing from Edison Partners (Finextra), Rated: A
Fund That Flip, an award-winning fintech platform and marketplace lender of residential real estate loans, today announced a raise of $11 million from Princeton, NJ.-based growth equity firm Edison Partners.
After origination, Fund That Flip offers accredited and institutional investors the opportunity to purchase fractional shares of the loan and earn an 8%-9% annualized yield.
3G Capital Advisors Facilitates $ 179.2 Million in Freddie Mac Loans Between Greystone and Watermark J&L Partners (Yahoo! Finance), Rated: A
3G Capital Advisors, LLC, a boutique real estate advisory firm focused on developing creative capital solutions for its partners, announced today the closing of $179.2 million in permanent financing for Watermark J&L Partners, LLC originated through Greystone and provided by Freddie Mac. The loans will refinance a portfolio of four multifamily communities with a total of 1,188 units in Arkansas, Colorado and Texas.
The 50 Most Expensive Towns in America (LendingTree), Rated: AAA
To take a look at how expensive town life can get, LendingTree, the nation’s largest online loan marketplace, ranked the 50 towns in the United States with the most expensive median home values. Our study also looks at the median income in these towns to determine how attainable homeownership is for the average person living there. What we found: The towns with the most expensive home prices are unaffordable to median income earners who live in those areas.
- Vineyard Haven, Mass., Summit Park, Utah, and Breckenridge, Colo., are the three most expensive towns in the country. Each of these towns is known for its proximity to natural features like mountain ranges or the ocean. While high levels of wealth tend to pool in these towns, the majority from these areas make an income well under the national household average.
- The majority of the towns featured in this study are unaffordable for the median income earner living in them. Both renting and owning a home are out of reach for median income earners in 42 of the 50 towns looked at in this study. This suggests that many people who work in the towns featured in these studies don’t necessarily live there, and instead commute.
- As our study makes clear, living in a small town does not necessarily make the cost of living more affordable. Many people living in the towns featured in our study would have an easier time affording a home in a major metropolitan area than in their current area. That being said, some of these towns are still relatively affordable like Los Alamos, N.M. or Gillette, Wyo.
The Apple Card’s best feature is also its biggest flaw (Business Insider), Rated: A
But that’s also the Apple Card’s biggest hindrance. Sure, having a credit card that lives on your phone in a digital wallet is ideal for convenience and security. Yet it also makes the experience of using the Apple Card more limiting than other options, especially when it comes to paying your balance, managing your card, and the rewards you get.
Silvergate Bank Announces A Crypto Lending Service In IPO Filing (Coin Revolution), Rated: A
Silvergate is the leading financial services provider for top Crypto exchange companies such as Xapo, Bitstamp, and Coinbase. The latest report indicates that the bank intends to roll out Crypto lending services.
Planning for LendIt Fintech USA 2020 is Underway (Lend Academy), Rated: A
LendIt Fintech USA will be held in New York City on May 13-14 next year at the Javits Center.
- The Small Business Fintech Ecosystem
- Revolution at the Point of Sale
- New Approaches to Capital for Growth Businesses
- Digital Banking Goes Mainstream
- New Systems for Identity and Trust
- Applying Fintech to Financial Wellness
Fintech Takeover Spending Hits Record Levels on 2019’s Megadeals (Bloomberg Law), Rated: A
Three blockbuster deals for financial-technology companies pushed takeover spending to a record $120 billion in the first half of the year as bidders targeted payments firms, according to research from consulting firm Hampleton Partners.
Ohio College Graduates Struggle With Rising Student Debt (CityBeat), Rated: A
Welcome to Ohio, where the average student debt is $28,947, according to a new study by LendEDU, an online student loans marketplace. Ohio’s average student loan debt is smack dab in the middle of the state-by-state rankings, with average student debt ranging from $19,742 in Utah to $38,776 in Connecticut.
About 58 percent of all students graduating from a four-year college or university in Ohio and the U.S. received a student loan to finance their education.
Futures Brokerage Capital Trading Group Announces Launch of Managed Futures Podcast (PR Web), Rated: B
Capital Trading Group, LP (“CTG”), an investment firm specializing in execution and account management for commodity trading advisors, has announced the release of its new Managed Futures Podcast hosted by firm principal and alternative investments specialist, Nell Sloane.
Funding Circle Surpasses $ 10 Billion Lent to Small Businesses Globally (BusinessWire), Rated: AAA
Funding Circle, the leading small business loans platform in the UK, US, Germany and the Netherlands, today announced that investors have lent more than $10 billion to small businesses globally through its platform. Achieving this milestone in less than a decade, Funding Circle has proven that its model has become the preferred option for small business funding that fuels economic growth — with every $1 lent to a small business through Funding Circle in 2018 contributing $2 to GDP, according to Oxford Economics.
Is Funding Circle Holdings Using Debt In A Risky Way? (Yahoo! Finance), Rated: AAA
The image below, which you can click on for greater detail, shows that at June 2019 Funding Circle Holdings had debt of UK£146.8m, up from none in one year. But it also has UK£449.9m in cash to offset that, meaning it has UK£303.1m net cash.
Zooming in on the latest balance sheet data, we can see that Funding Circle Holdings had liabilities of UK£180.2m due within 12 months and liabilities of UK£19.3m due beyond that. On the other hand, it had cash of UK£449.9m and UK£14.9m worth of receivables due within a year. So it actually has UK£265.3m more liquid assets than total liabilities.
ThinCats to lend £400m to growth companies by end-2020 (Growth Business), Rated: A
ThinCats, the growth-business lender, wants to be lending £400m a year to cash-starved scale-up companies by the end of 2020.
Welsh Delio secures £3.3m equity round (Fintech Futures), Rated: A
UK-based private asset infrastructure service, Delio, has secured £3.3 million in an equity investment round led by Maven Capital Partners, which will purport the company into markets across Asia, the Middle East and North America.
UK tech firms attract record £5.5bn in foreign investment (P2P Finance News), Rated: A
THE UK’S tech sector has attracted $6.7bn (£5.5bn) in foreign investment this year so far, which is more than the whole of 2018.
During the second quarter of 2019 more than $1.9bn came via investment deals valued at $100m or more.
Aprao launches development appraisal tool (PlaceTech), Rated: B
London-based startup Aprao has released a beta version of its development appraisal tool to 650 companies.
Aprao currently partners with property marketplace LendInvest, developer Careys New Homes, and design house Fusion to help further develop the technology.
New P2P entrants have a ‘second move advantage’ (P2P Finance News), Rated: A
If an industry as new as P2P can have legacy issues, there’s clearly a ‘second move advantage’ for new potential entrants who have an opportunity to build systems and processes ready for the new Financial Conduct Authority (FCA) rules:
- SMCR – the new governance rules are not just about assigning responsibility to individuals.
- Three lines of defence – will you need a dedicated compliance function? risk? internal audit?
- Recovery and resolution plans – we’re in discussions with a number of potential new entrants who are at the very early stages of their IT planning.
- Appropriateness tests – whilst incumbent firms are progressing with their plans to comply with the requirements, it is far easier to build the process from scratch – and price it in to the strategy.
Existing players continue to hit new milestones (such as Funding Circle’s $10bn announced this month), and secure increased funding.
How banking-as-a-service (BaaS) works and industry outlook (Business Insider), Rated: A
In the UK, the new revenue potential generated through open banking-enabled small- and medium-sized business and retail customer propositions was £500 million ($700 million) in 2018, per PwC — and Business Insider Intelligence expects that to grow at a 25% compound annual growth rate to reach £1.9 billion ($2 billion) by 2024.
Swiss Fintech Startup Becomes a $ 1 Billion Unicorn (Bloomberg), Rated: AAA
Numbrs Personal Finance raised $40 million to bring the total capital invested to almost $200 million, Chief Executive Officer Martin Saidler said in an interview. Numbrs offers an app that enables users to manage their existing bank accounts in one place and to buy financial products.
Lendable launches Luxembourg fund with Credit Suisse (AltFi), Rated: A
Lendable has launched its first Luxembourg-based fund initially providing up to £225m of financing into the UK consumer market.
The consumer lender set up the fund alongside Credit Suisse, with the pair raising capital from 10 unnamed investors across seven geographies over a three-year investment period.
Events for every P2P professional’s calendar in 2019 (P2P Finance News), Rated: A
LendIt Fintech Europe 2019
Dates: 26-27 September 2019
et 15 per cent off on your tickets with the discount code P2PFN15%.
Register at www.lendit.com
MoneyLIVE: Lending 2019
Date: 2 October 2019
Open Banking Expo
Date: 13 November 2019
Brocc raises Debt Financing from Goldman Sachs (MyNewsDesk), Rated: B
Brocc, a Swedish company specialized in P2P Consumer Lending, has raised funding from Goldman Sachs Private Capital (“Goldman Sachs”). Brocc intends to use this financing to issue consumer loans, allowing consumers to consolidate existing debts at lower rates.
Tala, A Digital Lending Startup, Raises $ 110M, Eyes India For Expansion (Crunchbase), Rated: AAA
To help over three billion underbanked adults have a chance at a loan, Tala has raised $110 million in a Series D round led by RPS.
The company currently has 500 employees across locations in Southern California, Kenya, Mexico, the Philippines, and India. The new money will be used to expand its India presence, as well offer new services. To date, Tala has raised $219.4 million in funding from investors like Revolution, Institutional Venture Partners, and PayPal Ventures.
Harmoney earmarks new CEO for NZ, Australian growth (NBR), Rated: AAA
Australasia’s largest marketplace lender is meeting a rapid pace of growth by ushering financial services leader David Stevens into the business from September 1, 2019. Stevens steps into the CEO role in early 2020, a transition that will free Harmoney’s founder and current CEO Neil Roberts to focus on strategy and product as the platform continues to innovate and lead across both markets.
Lendingkart Secures $ 2.95M From Sistema Asia Fund (PYMNTS), Rated: AAA
Indian startup Lendingkart announced that it has raised $2.95 million in new funding from Sistema Asia Fund.
The investment comes days after the company raised $30 million in a Series D financing round led by existing investors including Fullerton Financial Holdings, Bertelsmann India Investments and India Quotient. The total funds raised by LendkingKart is now at $146 million.
These are the top challenges faced by MSMEs, the growth drivers of Indian economy (Money Control), Rated: A
More than 500 Lakhs MSMEs exist currently and over the last 5 decades in India. This SME sector has grown dynamically contributing 45 percent of India’s GDP according to ‘Micro Merchant Market Sizing and Profiling Report’ which also shows it provides employment to around 46 crores people in India and is growing at a fast rate of 11.5 percent every year.
Business Loan Application Process: Explained (Ziploan), Rated: A
There are many aspects of the business that needs to be handled by a small business owner when he runs a business. As a small business owner, he doesn’t have resources to waste. But he needs to the optimal performance of every resource/department, so that cost of production is kept at a minimal level. And the profits are also enhanced. But when an individual multi-tasks and handles various functions all by himself, there are chances that some aspects of the business may miss his attention.
Singapore fintechs continue hiring despite economic slowdown (Insurance Business Mag), Rated: AAA
A recent study by the Singapore Fintech Association (SFA) and PwC said that 94% of fintech companies are eyeing workforce expansions over the next 12 months, with 28% expecting to double their employee numbers in the next three years.
Notable Singaporean fintech firms include digital insurer Singapore Life, remittance company InstaRem, and peer-to-peer lending platform Validus. The latter two companies are backed by Vertex Ventures, a venture capital firm under Temasek Holdings, Singapore’s sovereign wealth fund.
CTOS LAUNCHES SME CREDIT SCORE TO STANDARDISE CREDITWORTHINESS MEASURE (Digital News Asia), Rated: A
In order to provide an easy and universal assessment of creditworthiness for small medium enterprises (SMEs), CTOS Data Systems Sdn Bhd recently launched the CTOS SME Score.
CURRENTLY, there are almost a million SMEs in Malaysia contributing 37% to the national GDP. This figure is expected to rise to 41% by 2020.
SMEs also make up 98% of local businesses and create employment for two-thirds of all working Malaysians.
With 2,000 applications, Israel fintech regulator eyes licensing changes (CoinGeek), Rated: AAA
The Israeli Capital Market Authority is seeking to make changes to its licensing regime in order to encourage competition and grow the financial technology (fintech) industry in the country. According to a report by local daily Calcalist, the regulator has established dedicated teams that will specialize in blockchain and other emerging financial technology.