Crowdlending matches investors with borrowers to provide fast and flexible finance. FundingKnight is one of the UK’s leading crowdlending platforms, having financed over £30m in SME loans, property bridging loans, and finance for small-scale green energy projects. Crowdlending is particularly suitable for small and medium-sized companies. In this presentation we look at some of the reasons for this, with three case studies drawn from our own loan book. First presented at Accountex 2016

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Crowdlending for
growth: 3 borrower
storiesJasper Ehrhardt, Managing Director
First presented at Accountex 2016

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What is crowdlending?
• Direct transactions
between investors
willing to lend
money and
borrowers seeking
loans
• Platform manages
introductions, credit
assessment &
money transfer
• No equity changes
hands

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Not just a flash in the pan
Sources: Liberum AltFi Index
Pushing Boundaries: 2015 UK Alternative Finance Report, Nesta
“Future trends in UK banking: Analysis and projections. A Cebr report
for Fiserv”
Small business
lending 2015
Crowdlending:
13.9%
£6.34b
n
Crowdlending’s continued upward trajectory shows it has a real place in the
market and contradicts suggestions it’s just a gimmick

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What makes crowdlending different?
• Applications assessed on a range
of information, not just credit
checks, including expertise and
competence of key staff
• Not subject to the same
constraints as banks
• Speed and flexibility
• Lending decisions are made “on
the ground” by the credit team
• Willingness to lend

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Case study 1:
LeisureBench
• Garden furniture wholesaler
• Less than 10 staff
• Heavily seasonal sales
• Large stock orders, typically over
winter, tying up funds
• No bricks-and-mortar
In conclusion: Not the sort of profile to
interest a bank

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Case study 1:
LeisureBench
• Garden furniture wholesaler
• Less than 10 staff
• Heavily seasonal sales
• Large stock orders, typically over
winter, tying up funds
• No bricks-and-mortar
In conclusion: Not the sort of profile to
interest a bank
Our perspective:
• Established (since 2004)
• In profit
• Demonstrable ability to manage
cash, even across seasonal
variance
• Well managed
• Good business plan
Overall: credit team had confidence
in the borrower

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Our solution
• Loans are ideal to smooth out
irregular cashflow
• Secured against personal guarantees
from directors
• Payment holiday included at the start
of the term
• Loan was repaid early with no
penalties
• Borrower has recently returned for
their fifth loan from FundingKnight

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Flexibility • SMEs do not suit a
“one size fits all”
approach
• Three product types
• Repayment terms:
amortising, interest-
only, interest roll-up,
repayment holidays
• Secured and
unsecured
• Forward-looking
credit assessment

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Case study 2: Inspire
Insurance
• Insurance brokers established in 2010
• Outgrew their premises
• Keen to make a long term investment by
buying the next property
• Identified ideal property on the market at a
great price & in need of bridging finance to
move quickly
• A previous offer at another P2P platform had
fallen through when the community had failed
to raise sufficient finance to cover the loan
• BUT loan amount above FundingKnight’s
bridging LTV

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• LTV against market value instead of purchase
price
• Multiproduct solution: A combination of property
bridging and business loans enabled us to
finance the total amount
Leigh Mackey, Managing Director at Inspire,
commented,
“The process was simple. Gary was very forward
thinking and commercially minded and could see
what we were trying to achieve from the start. I
would certainly use [FundingKnight] again.”
Case study 2: Inspire
Insurance

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Speed • Speed of delivery is often
critical for businesses
• P2Ps are small companies
themselves – the chain of
decision making and approval is
short
• Assessment and decision
process is clear and transparent
• Direct access to credit analysts,
not just sales people

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Case study 3: Silent Sentinel
• Leading designer, manufacturer and
supplier of advanced surveillance and
security systems
• Evolved from OEM manufacturer into
market-leading developers of
innovative custom solutions
• Ongoing organisation-wide change to
support growth

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• 3 loans provided over 3 years:
• Working capital
• Product development
• Expansion overseas
• Supporting companies throughout their growth
• 8 days from application to auction
• All auctions are filled within 7 days
• Paperwork is completed up front so funds can
be transferred on day of close
Case study 3: Silent Sentinel

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At a glance
FundingKnight
£30m Loans originated
100% Year on year growth
Business loans | Property Bridging | Green
Energy
Product range
Sources:
altfi P2P business lenders index
“Future trends in UK banking: Analysis and projections. A Cebr report for Fiserv”
£100m
2012
£2.2b
n
2015
£20bn?
2020
UK crowdlending to
business

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Green EnergyBusiness loansProperty Bridging
www.fundingknight.com