Add George Luckraft of Axa Framlington to the growing list of fund managers who are moving in the P2P space.
Unlike the managers that have gone before him, Luckcraft’s approach has not been to buy loans directly from the alternative lenders themselves. FT Adviser reports that Luckcraft now holds various stakes in the existing investment vehicles that are dedicated to the alternative finance sector. Axa has backed GLI Finance and Victory Park Capital (VPC Specialty Lending) via the Axa Framlington Managed Income fund. Stakes in each of these quoted companies are also held in Axa’s Monthly Income vehicle.
For those that aren’t aware, Victory Park staged a successful float on the London Stock Exchange in early March – raising proceeds of £200m. The vehicle purchases loans from a broad range of originators on both sides of the pond, including Assetz Capital, Avant Credit, Borro, Elevate Credit, Fast Legal Funding, Kreditech, LendUp Global, Funding Circle and Funding Circle US, OnDeck Capital, Prosper Marketplace, Square and Upstart.
GLI Finance is a publicly traded company that holds equity stakes in a large variety of alternative finance companies. The company has taken various steps to raise money for the purpose of ramping up funding activity on its portfolio platforms. GLIF also announced in February that it would soon launch a closed end fund in order to purchase loans from amongst these platforms.
Mr. Luckcraft also has Axa’s Monthly Income fund invested in this sub-sector’s first mover: P2P Global Investments – the Marshall Wace backed vehicle that raised £200m via IPO in May 2014, and a further £250m this January through a C Share Issue.
Bradley Gerrard of FT Adviser also named Neil Woodford of Woodford Investment Management and F&C Investment multi-managers Rob Burdett and Gary Potter as prominent managers that bought into the P2P GI trust. It also seems that those managers that get a taste for the P2P space soon come back for more. Woodford Investment Management recently led a £20m equity round in high growth UK consumer lender RateSetter with an £8m investment. The round valued RateSetter at £150m.
Mr. Luckraft briefly summarised his position on the sector:
“It is a young industry and there will naturally be concerns. However, some of these platforms have access to better information than banks do.”
AltFi is returning to Amsterdam for its second annual Summit in the city. The inaugural event last year was a roaring success, with key figures from across Continental Europe's alternative finance and digital banking sectors highlighted. These included Jeroen Broekema, managing director of Funding Circle Netherlands, and Mieke van Engelen, head of innovative partnerships at ABN AMRO's standalone lending platform, New10.