Tag Archives: Funding Circle

funding4business – real estate crowdfunding

Real estate Crowdfunding set to top US$2.5 Billion this year

Entrepreneur Magazine
Catherine Clifford – 4th March, 2015

Real-estate crowdfunding was a $1 billion industry in the USA in 2014 and is expected to grow to more than $2.5 billion this year, according to a report released today from USA industry research firm Massolution.

Across the globe, investors and homebuyers are using crowdfunding as a way to own and profit off of commercial real estate or to finance the purchase of their own homes. In 2014, USA crowdfunding campaigns ranged in size from less than $100,000 to over $25 million.

When most people think about crowdfunding, they’re likely to think of a group of friends pulling their finances together to back the launch of a new indie film or a wallet made out of duct tape.

While still emerging, the real-estate crowdfunding industry is growing quickly. To date, there are 85 real-estate crowdfunding platforms currently in operation, according to Massolution.

“Residential crowdfunding has the breakout potential, as mortgage loan origination, a trillion dollar market, is opening up to distributed platform financing,” the report says. One example of residential real estate crowdfunding is LendInvest, a platform out of the U.K. that did $240 million worth of residential mortgage loan initiations last year.
Property investors are using real-estate crowdfunding as an alternative way to invest money they are looking to make money with. For example, on USA platforms such as Realty Mogul, many investors pool their money to buy a commercial real-estate investment with the expectation that the rate of return on their investment will be higher, with less risk, than other typical investment alternatives.

The benefit of real-estate equity crowdfunding over real estate investment trusts, or REITs, which have already been around for two decades now, is speed and diversity. “Technology allows this activity to be conducted more swiftly and more efficiently, availing the investment opportunity to more participants,” the report says.

Crowdfunding for commercial and industrial investments is growing faster than it is for residential or multi-family real estate investments, according to the report. Still, crowdfunding is being used as an alternative finance method to a mortgage from a bank for individuals looking to move into their first home. And there is significant potential in this sliver of the real-estate crowdfunding market.

funding4business recognised this emerging trend into on-line and Internet based financial services and was specifically established to facilitate peer-to-peer start-up funding and business loans to Aussie businesses.

funding4business enables crowdfunded property investments – today

We are an Aussie company, with an Aussie team, applying Aussie developed technology and know-how, to an emerging P2P alternative investment and financial marketplace for the benefit of Aussie business borrowers and Aussie investors.

We connect business borrowers with investors such as SMSFs, HNWIs, SIVs and PIVs holders for their mutual benefit.

Peer-to-peer (P2P) lending acts as a flexible investment alternative where established businesses can borrow funds and negotiate business loans directly with willing investors at mutually acceptable investment rates, terms and conditions.

The funding4business marketplace is open and transparent, offers a broad range of investment options, provides flexibility, offers potentially better investment returns, faster and simple settlement, online registration and algorithmic loan matching to your investment criteria.

funding4business was launched in Australia on 1st August 2014.

funding4business – digital disruption a major threat to the established banks

Digital disruption a major threat to the established banks

In a recent discussion between Richard Gluyas of The Australian and Paul Bassat one of the founders of Seek, the subject of changing technology and the threat this poses to the major banks in Australia was explored.

Basset claimed that the scale of the potential rewards in successfully carving out a niche in the Australian banking sector through the introduction of disruptive technology, were huge. Bassat suggested that the early technology movers seem to be focused on the mobile payments sector with PayPal, Amazon, Western Union, Visa and a raft of smaller players carving out handy niches in this space globally. But mobile payments is the first of many inroads being made into the cloistered realms of banking and finance. For example:-

The San Francisco based LendingClub Corp, one of the USA’s largest players in the online peer-to-peer marketplace, recently filed for an initial public offering (IPO). LendingClub has facilitated more than US$5 billion in peer-to-peer loans since its launch in 2007 and revenue has more than doubled to US$87.3 million in the six months ended June 30 2014 from a year earlier.

“LendingClub has an interesting business model and has carved out a market niche in the peer-to-peer marketplace as bigger banks are scaling back riskier lending” claims Joseph Schuster founder of IPO research firm IPOX Schuster LLC.

Since the Global Financial Crisis in 2008, the traditional banking system has been hurt by the high underwriting and servicing costs associated with lending to small businesses. Consequently it has created an opportunity for non-traditional lenders through P2P platforms to cater to the growing demand for alternative business financing options and directly connecting borrowers and investors

Peer-to-peer (P2P) lending lets investors lend directly to individuals or businesses and uses low-cost online platforms to cut out the banks and other financial institutions. The P2P lending industry rose to prominence during the global financial crisis, plugging a hole left by the reluctance of cash-strapped banks to lend to small businesses.

This shift to peer-to-peer (P2P) lending is not unique to the USA. In Britain for example, some peer-to-peer (P2P) networks are offering “mini-bonds” by lumping together lots of small, unsecured loans from retail investors such as superannuation funds, and lending them to established businesses in the form of debt funding. The major UK P2P networks providing these investment options include, Funding Circle, Zopa and RebuildingSociety.

Peer-to-peer (P2P) lending acts as a flexible investment alternative where established businesses can borrow funds and negotiate business loans directly with willing investors such as super funds, at mutually acceptable investment rates, terms and conditions.

funding4business has recognised this technological and cultural shift and is the first and only peer-to-peer (P2P) marketplace in Australia, specifically established to facilitate business loans, by connecting Aussie business borrowers together with Aussie investors such as SMSFs, and HNWIs for their mutual benefit.

The funding4business marketplace is open and transparent, offers a broad range of investment options, provides flexibility, offers potentially better investment returns, faster and simple settlement, online registration and algorithmic loan matching to your investment criteria. P2P investing is a win/win situation for Aussie borrowers and Aussie investors.

We are an Aussie company, with an Aussie team, applying Aussie know-how, to an emerging P2P alternative investment marketplace for Aussie business borrowers and Aussie investors.

funding4business was launched in Australia on 1st August 2014.