Author: wiseclerk

P2P Equity Service Seedmatch Launched

wiseclerk 4 Comments

Last week, following 2 years of preparation, Seedmatch launched the first p2p equity service in Germany. Startups can pitch for up to 100,000 EUR (approx. 142,600 US$) funding. Investors can bid amounts starting form 250 EUR.

Due to the legal and regulatory situation Seedmatch uses a construct (“Stille Beteiligung”), where investors do not become shareholders of the funded startup, but rather participate on the profits of the company. Founder Jens-Uwe Sauer says: “… the silent partner’s holding are structured at Seedmatch to participate on dividends and capital gains of the start-ups. It was important for us to offer a good solution for both sides – for the micro-investors a fair deal and for the startups a manageable financial model.” (translated from German by P2P-Banking.com).

The startups have the choice to buy-out investors after 6 years. The Seedmatch model thereby gives much more control to startups and less rights to investors in comparison to Symbid and Crowdcube. On the other side the raised funding is not paid out in one sum, but rather in steps according to milestones reached (which were specified in the pitch). Seedmatch charges startups 5 to 10% of the raised amount. Continue reading →

Lending Club Gets $25M More Funding

wiseclerk

P2P Lending service Lending Club has raised another 25 million US$ funding.

Union Square Ventures led the Series D round and joins Lending Club as a Board Observer. All existing venture investors participated in the funding round.

“We are thrilled to welcome Union Square Ventures as an equity partner,” said Lending Club CEO Renaud Laplanche. “While we did not need additional funding, we could not pass up the opportunity to work closely with the USV team and their network of companies. USV will be instrumental in continuing to accelerate Lending Club’s growth and in leveraging our technology platform and network effect to simultaneously reduce the cost of credit to borrowers and enhance investors’ returns.”

The new funding brings Lendingclub’s total funding to 77.7 million US$.

(source: press release)

Review of Symbid: My first investment in a startup

wiseclerk

Time for me to personally test Symbid (see earlier coverage) and try out how smooth the process is and how easy it is to invest in a startup with Symbid.

No matter how remote you live – be it India or Argentina – you can invest in an internet startup online within minutes and get shares – all you need is a credit card

This article is a step by step review of the signup and investment process.

If you have not read the previous articles, watch the brief video on the Symbid homepage which explains the concept.
First step to use Symbid is the free registration. Most parts of the website can be used without a registration, but registration is needed to view detailed company information and to invest.

To register either click on “Join Symbid” via “Start Investing”. Instead of the registration form I expected to see, I got this screen:

It wasn’t obvious at first to me that I need to click on the symbid key symbol to reach the registration form (I did not want to use my Facebook or Twitter account). Next hurdle was the missing country field in sign-up (Symbid is open to international investors – seems they forgot adding it when opening to international). I solved it by adding country into the city field (city, country).

Once registered, I could add some information about me on the profile.

To start investing the next necessary step is to ‘upload’ money (minimum is 20 Euro which equals approx 29 US$). To upload money you first request a security code. They send an email with a link. After I clicked on it I could setup a personal 4 digit code.

With that code the process to upload money is started (‘upgrade Balance’). The selection allows for 20 Euro steps, as 20 Euro is the minimum unit that can be invested.

Continue reading →

First Business Offer Fully Funded at Crowdcube

wiseclerk

On the peer-to-peer equity market Crowdcube (see earlier coverage) the first business succeeded in raising the desired funding in exchange for equity. Yesterday bodycare business Bubble & Balm hit its funding target of 75,000 GBP. The amount was funded by 82 investors which will in return receive 15% of the equity of the company.

I am one of those, albeit with a symbolic amount of 20 GBP invested, which means that in the future I will own a whooping 0,004% (=1/25000) of Bubble & Balm, once the transaction is legally finalized.

Investing so far was very easy – I contributed my 20 GBP (plus fees) via Paypal. There is the option to pay via bank transfer too. After uploading the money to the account I then selected the business to invest to.

For the moment it is fun to participate in this first public p2p equity process in the UK and I see it as an experiment with the ability to gain first hand experience how it proceeds.

I selected Bubble & Balm as an “investment target” for three reasons:

  1. It was clear that this pitch would be the first to fully fund
  2. It is an established business that already operates since 2009, not a startup with a mere idea
  3. The information provided in the pitch is sound (business plan, financials, background of founder)

The bodycare business will use the investment to expand its award-winning product range, increase marketing activity and to meet increasing demand from retailers such as Waitrose, Oxfam, Planet Organic and a growing number of independents.

Zopa Removes Listings – Concentrates on Markets

wiseclerk 2 Comments

Recently Zopa UK removed the ‘Listings’ functionality that allowed borrowers to list individual loans. Listings were introduced in October 2007 as a add-on to the original Zopa markets model.

Here is the official announcement of Zopa regarding the removal of the Listings function:

You might know that Zopa is a little unusual amongst the now 30+ peer-to-peer lending companies running worldwide in that we facilitate the vast majority of loans through the Zopa Markets; almost all the other peer-to-peer lenders make all their loans using something more like our Listings. Indeed, we weren’t first-to-market with the Listings approach, adding them to our site about two and a half years after we first launched. Since then some 700 Zopa borrowers have received loans totaling £4.3m using Zopa Listings and there’s been some great ones in there; from guitar re-stringing, to a planetarium, a few bits of plastic surgery and of course plenty of cars.

Sadly though, while those figures sound quite good, they only represent a very small proportion of total Zopa lending and that proportion is declining too, while the rest of our business is growing rapidly. Couple that with Listings being much more long-winded to underwrite and we hope you’ll understand why we’ve taken the tough decision to draw Zopa Listings to a close.

… we’ll remove the functionality from the site that allows borrowers to create a new Listing. All the Listings that are already live before this point will of course be allowed to continue to their natural conclusion and once they’re all finalized, we’ll remove all references to Listings from the site.

If you’ve taken part in any lending via Listings, you’ll still be able to keep track of them and monitor how they’re being repaid in My Loan Book, where you can now find a link to your borrower’s original Listing page in the detail page of the loan in My Loan Book (click on the borrower’s username to open this view).

We hope you understand our decision.

Best wishes,

The Zopa Team