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CrowdProperty Summer Update

It is over the summer when we all get a chance to reflect on the progress of what we are working on, although given that the level of applications for property project finance has never been higher, that reflection can only be brief for us at CrowdProperty as we put our foot down on the accelerator. Fortunately we’ve planned ahead and grown a great team to cope with our impressive growth.

CrowdProperty has now funded 44 projects constituting 284 units. In 'Fixing our Broken Housing Market', the main housing white paper published in February 2017, the UK Government specifically identified small and medium sized property businesses as a key part in solving housing under-supply in the UK. We are committed to providing sustainable finance to address the broken and inefficient funding market for small and medium sized property businesses, thereby making our lenders’ funds work harder. It’s our efficiency that means a better deal for all which, when coupled with our exceptional speed and customer service, means that we attract the very best property projects and take market share from banks and not those who cannot source finance from elsewhere.

As we near our 4th birthday, we have built the robust systems, processes and team to scale the business and are now on the brink of £20m total funding to date. However it’s neither total funding nor time to fund that means most to us – it’s our 100% capital and interest payback track record that we work extremely hard every day to protect. We have now paid back 21 projects, totalling £8,242,000 including £776,000 of interest.

As a sector, peer to peer lending is not covered by the Financial Services Compensation Scheme (FSCS) and capital is at risk. Our business is founded on deep expertise that underpins our rigorous due diligence, thereby managing the risk that might be associated with higher returns. We remain surprised by the lack of actual property expertise in traditional and alternative property lenders and are proudly different having the experience to understand property projects better. Of course we also secure all projects by means of a first charge on the property asset, should anything go wrong.

We have always championed the fundamental ethos of peer to peer lending as a transparent way for the supply and demand of capital to be efficiently matched. We are of course fully FCA authorised and regulated and keep at the forefront of their requirements as the sector matures. We very much welcome the recommendations in the latest FCA consultation paper (CP18-20) which focuses on how platforms will continue to protect consumers through increased governance, transparency and improved wind-down procedures. We are committed to implementing measures to ensure that peer to peer lending remains open for all to lend through. We also know that increased transparency and comparability will shine a brighter light on our superior track record, which is one area that we have significant developments coming to put ourselves transparently at the most attractive end of returns and risk management.

Our 2018 Lending Survey gave us valuable insights into what’s most important to our lenders and where we can work harder to serve our customers’ needs better. We also hugely value ad hoc feedback from customers and build that into our proposition development too. Since the survey, we have already delivered a number of further improvements, building on the developments that we had already implemented this year, including:

1) We now release project information earlier. Specifically, we now release information 24 hours before the launch of a project. We see a great deal of website traffic reviewing the projects thoroughly and also greater attendance on project webinars where you can hear from the borrower and ask questions. We are very pleased about this as we want you to fully understand the projects that we offer

2) We are getting your money working quicker. We have worked hard on our processes to ensure that your funds are employed and earning interest quicker. The last 3 projects funded will be completed in under 10 working days on average. This is still work in progress and we see further improvement potential as we tackle the many variables associated with property projects, the majority of which are due to our commitment to best secure your funds

3) We have a far stronger pipeline of projects. Whilst projects throughout 2018 have been funding very quickly (our last 4 projects which were listed over a period of 10 days funded £2,267,000 in just 48 minutes on the platform), which is a testament to the trusted brand we are developing, our aim is to have projects available on our website for longer so that people who aren’t able to be online at 10am or during the working day can also participate. A great deal of hard work behind the scenes has built a very strong pipeline for the remainder of 2018 and beyond, it just takes time for that increase to flow through to fully assessed, fully secured projects listed on our website. Our criteria never change, so therefore our focus is on being better at finding, assessing and competing for the very best projects, which our proposition is attracting. Rest assured, this is a major priority of ours

4) We have grown our team to continue to provide excellent customer service as we scale. We have been investing ahead of demand on our platform to ensure our customer service stays well ahead of the competition - we are not waiting and playing catch up. We now have a passionate and talented team of 23 based in our office in Birmingham

5) We are building a new website. Launching in September after much development work, our new website will have improved usability, more statistics aligned to the very best peer to peer lending practices and more information on projects. We are very excited about this major development and it will be a step change in our journey.

On the borrower side, the results we have achieved from a lot of hard work on our pipeline of projects has surpassed even our high expectations. This will come to fruition on the platform over the coming few months and is driven by our relentless focus on delighting customers with our proposition which has been honed from extensive research on the borrower side too. The premise of being simple, quick and transparent is seen as a powerfully refreshing differentiator in the market and we are getting excellent customer feedback on a very consistent basis. After funding his project on CrowdProperty in a matter of minutes recently, one very experienced property professional gave us a news release quote summarising his first experience with CrowdProperty as “outstanding”, and went on to reinforce that we are delivering on what we set out to do:

“Throughout the whole process, CrowdProperty were incredibly easy to work with and did exactly what they said they would do. The customer service and care was so refreshing after decades of dealing with cumbersome processes at traditional lenders that would take up 90-95% of my time. Working with CrowdProperty means that I can focus on what I’m great at and they can sort the finance, quickly and simply. They’re a game changer.”

Over the next few weeks we have a number of major developments to announce with more to follow on these shortly.

Your capital is at risk. No FSCS protection. Past performance is not an indicator of future results. Tax treatment depends on individual circumstances and may change. Full risk warning.

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