Assetz Capital

Idea

Introduction

The financial system is broken. Businesses can’t get the funding they need and investors can’t get a fair return on capital. We’re providing a solution to those problems.

Our vision is to be the most trusted financial services business, where investors intuitively come for an impactful and fairer return on their capital and businesses come for fairer, real-world lending. We’ve provided c£1.5bn of loans to SME businesses and developers, financed by retail & institutional investors.

With our brand, scale and 130 staff, we’ve achieved critical mass and proven our model - having been profitable in the 17/18 & 20/21 financial years, and with EBITDA, minus exceptional funding costs, positive in 18/19 & 19/20.

We’re at a pivotal moment with the potential to become one of the dominant few in the multi million business lending market.

Our first Impact Report, published at www.assetz.com, shows the positive change that our investors have achieved to address challenges in society.

Substantial accomplishments to date

Since commencing lending in April 2013, Assetz Capital has proven its position as a leading brand in the multi-billion business lending sector, and a leading online marketplace for secured business loan investments:

• We are the leading property-secured business marketplace lender in the UK, and the second largest in the UK & Europe.

• Loans arranged of c£1.5bn so far

• Acheived both CBILS and RLS accreditation to lend under the government loan guarantee scheme

• Working towards target of £1bn of lending a year and a £5-10bn loan book in coming years

• £1bn+ of institutional investment confirmed alongside an existing £300m of retail funding on the platform, with further funders in progress

• Ranked 53 out of the UK top 100 fastest-growing tech companies in two consecutive years in the Sunday Times Tech Track 100, with 78% average revenue growth per annum, and featured in the FT1000, Europe’s fastest growing companies

• Investors have earned around £140m gross interest before tax

• Well diversified funding with numbers of globally recognised institutions such as banks, government, credit funds and investment managers accelerating strongly

• Revenues of £15m in the last audited financial year and targeting further growth

• IFISA now has 6,000+ investors and £85m+ invested

• Funded the equivalent of 1 in 100 English homes in the last two years (inc. the national house builders) and 1 in 12 of all new homes by SME builders according to House Building Federation statistics.

Monetisation strategy

We charge our business borrowers an arrangement fee of typically 2-3% of the loan inclusive of any introducer commission that we pay out and we also charge the borrower a loan monitoring and servicing fee (typically 0.5-4% pa on the loan balance). Direct business that does not come via a broker means we have higher earnings and we are growing that part of the business actively.

As we attract more and more capital from investors and build our track record and loan book performance data we expect our cost of capital continue to lower, potentially both improving our margins and also tightening the rates at which we can potentially fund, making us both more competitive and profitable.

Our product offering has become considerably more attractive since before the pandemic with our broadening marketplace of funders meaning we can now offer loan sizes of £250k to £50m, well above our previous £10m maximum. We also have interest rates starting from just 5.5%, well below prior rates.

Use of proceeds

We are in the process of converting our 2020 Seedrs Equity round, in conjunction with the Future Fund, and are opening up this campaign to allow investors to join the investment in this round. The capital will be invested to grow the business further including the following projects:

• Investing in new technology initiatives to grow the sales pipeline of the business, increase margins and increase productivity

• Helping fund the increasing ‘skin in the game’ where we provide a small percentage of each loan alongside our institutional funding partners

• Working capital to support the enlarged company scale

• Continuing to substantially grow the team from our current 130 staff

An IPO continues to be evaluated as a future step and advisors are now engaged to help us prepare for that process.