GLI Finance is led by CEO Geoff Miller, a City investment veteran who's spent the last few years transforming what was once a very specialist investor in US credit markets into a putative Alt Finance heavyweight, with a focus on lending to small and medium sized businesses. Last year Miller signalled the big shift with a takeover of a specialist technology financing house (BMS), based in the Channel Islands.
This week's Platform Black deal clearly demonstrates that GLIF is targeting the AltFinance space. GLI Finance has invested £2m in the Platform Black Limited in the form of equity and preference shares and will own at least a 20% stake in the business -Geoff Miller is also joining the Platform Black Board.
Platform Black is the main competitor to MarketInvoice and uses money from high net worth investors and institutions to fund an auction based model that funds SMEs 30 to 90 day invoices. SMEs auction their invoices, remaining in control of all of the costs, to investors who compete to deliver the lowest cost of finance. Platform Black has advanced c. £21m to SMEs to date, and claims it can deliver net annualised returns of 12-15% to investors.
According to Miller, the deal is "a perfect fit within our strategy of focusing on niche lending to SMEs and enables us to add short-term asset-based debt to our portfolio, while continuing to reinforce the geographical diversification of our business". Crucially the deal involves GLI not only funding Platform Black itself, but also trading activity on the site.
According to Colin Levins and Louise Beaumont, co-founders of Platform Black " In 2012, in the UK alone, the invoice finance market was worth £254bn. This, together with a gap in SME funding estimated to be between £84bn and £191bn by 2018, means that there is significant and growing demand for our services. There are excellent synergies between GLIF’s other platforms and our business and we look forward to working with Geoff and his wider team.”