ashtondav
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Post by ashtondav on Dec 1, 2019 14:12:33 GMT
14 years old, still not profitable and today's Times says the funding required by the company to become a bank will be at a far lower level of valuation than the last fund raising.
So, is p2p a scalable long term business?
FC for example has declined in value by over 80% in a year. As Adair Turner said a few years ago peer-to-peer lenders could be the source of losses that would “make the worst bankers look like absolute lending geniuses”. Now, he was biased but nevertheless there is very little good news in the sector.
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benaj
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Post by benaj on Dec 1, 2019 15:59:52 GMT
Good question. Looking at Honeycomb IT factsheet, it seems the IT does make profit from p2p without running the platform and business. www.honeycombplc.com/media/3828/2019_10_31-honeycomb-monthly-factsheet-october-2019.pdfLet's say Zopa limited (p2p) is not loss-making, but VC backers want more for their bucks. May be it's not easy to make profit while keeping the loanbook and number of investor growing. Looking at the Mintos model, they look for loan originators and match money from investor, a complete different approach but it seems to work so far before ”defaults” happen. |
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ashtondav
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Post by ashtondav on Dec 2, 2019 9:27:02 GMT
What concerns me is that there is an implication, and possibly more, that the business is not viable UNLESS it gets a banking licence.
If that is so, it casts doubts over the viability of other p2p platforms with a similar business model. 14 years should be sufficient to prove a new business, but in reality it has not delivered.
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wapping35
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Post by wapping35 on Dec 2, 2019 10:08:13 GMT
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Post by fuzzyiceberg on Dec 2, 2019 11:00:05 GMT
Clearly P2P is not profitable enough on its own. In the low interest rate environment there is not enough headroom to undercut banks, give Zopa P2P lenders a decent return, and make enough to keep their shareholders happy. What will be interesting to see is how they think they can offer traditional banking products without competing against their P2P operation.
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