News Briefing - Crowdfunding, SME And Alternative Finance

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Today's Briefing

 1.UK – P2P


Bloomberg uses a friendly table tennis match between Funding Circle and LendInvest employees as a hook for current challenges facing both companies.


“More than 30 percent of Funding Circle’s London employees are non-British EU nationals. Ever since the company was founded in 2010, many have gravitated to the ping-pong table that co-founder Samir Desai set up in its lobby, next to a cabinet that has steadily filled up with trophies. Funding Circle is one of four companies Bloomberg is following through the Brexit process.

The two companies compete at more than table tennis. In August, Funding Circle received 160 million pounds ($213 million) from Dutch insurer Aegon NV to fund loans to small- and medium-sized businesses via its website. Two months later, LendInvest topped that by raising more than 200 million pounds from Citigroup Inc. to fund mortgages on its site.

The deals showed that even as Brexit dents the U.K. economy, the fledgling online-lending industry continues to grow. In the third quarter, Funding Circle arranged 114 million pounds in net lending to its borrowers. That surpassed comparable loans by U.K. banks, on a combined basis, for the first time. “We have an opportunity to take market share from the big banks,” Meekings said.”

2. UK – AltFi

Bridging & Commercial reports:

“Growth Street has announced that it is collaborating with University College London (UCL) school of management to give students experience of using business analytics.

Over the last six months, the alternative finance company has hosted multiple students from UCL’s masters in business analytics programme.

During this time, the students have worked on predicting a business’s likelihood to borrow money over a given period of time.

They used data science techniques to interrogate anonymised sets of customer information, such as sales and purchase histories, as well as their usage of Growth Street’s financing product GrowthLine.

Greg Hinch, head of product at Growth Street, said: “Hosting bright minds from the world’s top universities is a mutually beneficial way to explore product development.”


3. US – SMEs/AltFi reports SMEs are branching out from banks in the search for funding.

“The latest data on small business finance suggests entrepreneurs luckily have a range of options when it comes to seeking working capital as large institutional lenders continue to increase their SMB loan application approval rates. Other data suggests speed of accessing financing is critical to small business owners, and a major factor behind their decision to seek working capital via alternative lenders or credit cards.

New reports from Biz2Credit, Reliant Funding and Mercator take a look at how small businesses are accessing external financing towards the end of the year as the holiday rush descends. PYMNTS has all the key data from the research below.

25 percent of SMB loan applications at large banks were approved in October, according to the latest research from Biz2Credit. That means large banks (with $10 billion-plus in assets) have boosted their SMB loan approval rates to a new post-recession high, researchers said. According to Biz2Credit CEO Rohit Arora, the statistic shows how far bank lending to small businesses has come since the depths of the recession, during which large banks only approved about one-tenth of SMB loan applications.

56.8 percent of SMB loan applications were approved by alternative lenders, according to Biz2Credit. While this category of lender still approves the most small business loan applications, the October data shows continual declines in alternative lender approval rates. Similarly, small banks saw their SMB loan application approval rates drop in October to 48.9 percent — again, still high, but continually decreasing.

12 percent of SMB owners told Reliant Funding they are aware of alternative lending and have used it.”


4. US – FinTech


Finance Magnates on more crypto-currency developments.

“ETHLend, one of the first fully functioning decentralized lending platforms, has successfully raised $10 million USD in the first half an hour of its public token sale. The token sale enticed a wide range of investers and early adopters of the decentralized lending application build on top of Ethereum network.

ETHLend represents a decentralized lending platform with an extensive roadmap that is going to see the ETHLend team to implement various crypto financial products such as token lending, crowdlending, collateral management and a protocol for AI lending bots. More information on ETHLend’s road map can be found by accessing the following link.”


5. International – AltFi


The Drum reports:

Amazon India has forged an alliance with hardware accelerator, HAX, and crowdfunding platform, Kickstarter, to help Indian startups reach a global audience and attain funding.

As part of the partnership, the companies will organise a Startup C-Cube challenge, where the winning startup will be supported through the entire “concept-to-customer” journey. The joint program will also provide resources to the winner for its launch - both in India and in Europe/US, depending on the scalability of the idea.

The alliance is a boost to the Government’s ‘Startup India’ initiative and will help empower Indian startup communities to connect with others to showcase their ideas to help create real business opportunities.

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The Daily News Briefing is sponsored by Money&Co. and edited by Martin Baker, Director of Content and Communications at Money&Co and Editorial Director of Another Crowd.

It is provided as a free information service, based upon fair use. Nothing in the Daily Briefing is privileged, confidential or investment advice.

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