Nicola Horlick’s new platform has opened with a bang – completing a £1 million peer-to-business loan.
The platform – Money & Co. – enters a similar space to Funding Circle – offering loans financed by the crowd to SMEs. But as this initial loan reflects, Money & Co. appears to be targeting businesses seeking larger loans than would typically be found on the Funding Circle platform. The £1 million lent to manufacturing business Mecmesin is thought to be the largest peer-to-peer loan ever made – excluding those made within the property lending sector, where Wellesley & Co. hold the record at £8.3 million.
Robert Oakley, Chairman of Mecmesin, had become deeply frustrated by the banks:
"They want to charge lots of fees. It has been difficult. We have great pedigree and blue-chip customers and the banks want personal guarantees and security. That was the final straw. There is not enough respect for firms like us."
Ms. Horlick claims that Mecmesin’s asset base and strong record of profits made for a very safe investment opportunity. The family-owned business – founded back in 1977 – has an annual turnover upwards of £10 million, makes £1 million in annual profit and employs 160 people. It will pay a 7.3% interest rate on the record £1 million loan, with Money & Co extracting a 1% fee.
It is a credit to the model that Money & Co. has already seized so coveted a record within the peer-to-business space. Of the 5 businesses currently listed on the platform, none is seeking less than £100,000 in funding. Money & Co. appears to be honing in early on larger scale loans.