Post by andrewholgate on Jan 6, 2014 16:37:21 GMT
Welcome to 2014!
You may have noticed I took a break over Christmas and New Year, which was the first real holiday (ie not actually doing much work) for almost 18 months and I was sorely in need of it. After a week of mountain air in France (and no, I didn't trip up Schumacher in Meribel), I'm feeling very refreshed and ready for the year ahead. On the plus side, my little girl can now ski which is a joy to watch but gut wrenching on a slightly steeper incline.
I said my thanks before Christmas and I'm not going to be disingenuous about them, your support from launch has been amazing.
We have a lot of plans for 2014 and I have been listening to and studying your feedback over the last few weeks. I'm going to address a few points in this post but there are somethings I can't cover yet but I will allude to them if I can.
Aftermarket - As chris mentioned, we have dropped the fees. This is a permanent move and makes us the first and only fee free P2P site for lenders/investors. There was a lot of debate on this internally but we felt that it was the right decision especially given our commitment to be fair to our lenders. It's a small gift to you but I do believe an important one.
Drawdowns - Ah, the bane of my life! I fully recognise that drawdowns take far too long and that loses investors money during the dead time. As we are not a bank, we can not offer a deposit rate on those funds while they are tied up, which leaves us in a difficult position. One of the biggest problems is that when we take tangible security, as in real assets such as property, we have to deal with third parties and the information flow from them is out of our control. As you will have seen with B***s, we delayed the auction until we had the information we needed, which should improve the dead time. I think there are other changes we can make to speed up the process, especially in the legal due diligence we do, and I will be looking to implement these during Q1 of this year.
W***w*** H*! - I was wanting to close that off before 31/12 as we had the underwriting in place, but with the next loan a few days from being ready we have kept it open. Had I closed it off (wiseclerk take note!) we would have closed off £5m of funding and caught our nearest rival in monthly lending terms, and taken AC to 5th in the world. Not bad for 9 months of hard work! It will stay open for a few more days, just so we can throw off the dust covers from the holiday and get rolling again.
Profitability - AC was in profit for Q4 of 2013. Our year end is 31/3/14 and I hope to be able to post figures showing profits before exceptionals (mainly our set up costs) for that year end. I know TC has made profits, but I think we are only the second platform to do so, and certainly the fastest to profits. This comes on top of some hefty set up costs and also recruitment of key people in the year (Mark Wardrop being one, and our Head of Compliance Andy Sheppard being another). Q4 was a turning point for AC and I look forward to 2014 with real relish having established the stability we need from profitability.
The future - The industry is evolving. Regulation from April is the first big change. Others have stated they have interim permissions, but nobody does until April. I can say AC does not see any problem in getting interim permission from the FCA, nor full permission. Personally, I think the FCA will request certain firms to become regulated soon after April as they see them as high risk. Ironically, we could be one of the last to become fully regulated as we are a safe option. That is a personal opinion, and a lot will come from how the FCA will play things.
The next big change is institutional money. The Government started the process with £20m going to FC last year and Ratesetter have just taken a large slug this year. The British Business Bank have £300m available to the industry, but personally I think that is a drop in the ocean. The real cash comes from institutional lenders such as hedge funds and banks. We saw a glimpse of this with FC allegedly speaking to Santander and Google, Eaglewood Capital and others invest through Lending Club in the US. The risk is the big force out the small and thus losing the principle force for P2P, especially our fairer world. Personally, I feel there is a place for both but only if the large funds are used to help the smaller investor, such as we have done with underwriting a loan. If AC do ever have institutional money invested through the platform, I will still be looking to ensure our smaller investors get the opportunity to invest or to be able to buy loan units on the aftermarket. P2P has been driven by the crowd and should remain available to the crowd. AC states it offers a fairer world, my personally integrity tells me I need to keep it that way.
Discourse over.
A
You may have noticed I took a break over Christmas and New Year, which was the first real holiday (ie not actually doing much work) for almost 18 months and I was sorely in need of it. After a week of mountain air in France (and no, I didn't trip up Schumacher in Meribel), I'm feeling very refreshed and ready for the year ahead. On the plus side, my little girl can now ski which is a joy to watch but gut wrenching on a slightly steeper incline.
I said my thanks before Christmas and I'm not going to be disingenuous about them, your support from launch has been amazing.
We have a lot of plans for 2014 and I have been listening to and studying your feedback over the last few weeks. I'm going to address a few points in this post but there are somethings I can't cover yet but I will allude to them if I can.
Aftermarket - As chris mentioned, we have dropped the fees. This is a permanent move and makes us the first and only fee free P2P site for lenders/investors. There was a lot of debate on this internally but we felt that it was the right decision especially given our commitment to be fair to our lenders. It's a small gift to you but I do believe an important one.
Drawdowns - Ah, the bane of my life! I fully recognise that drawdowns take far too long and that loses investors money during the dead time. As we are not a bank, we can not offer a deposit rate on those funds while they are tied up, which leaves us in a difficult position. One of the biggest problems is that when we take tangible security, as in real assets such as property, we have to deal with third parties and the information flow from them is out of our control. As you will have seen with B***s, we delayed the auction until we had the information we needed, which should improve the dead time. I think there are other changes we can make to speed up the process, especially in the legal due diligence we do, and I will be looking to implement these during Q1 of this year.
W***w*** H*! - I was wanting to close that off before 31/12 as we had the underwriting in place, but with the next loan a few days from being ready we have kept it open. Had I closed it off (wiseclerk take note!) we would have closed off £5m of funding and caught our nearest rival in monthly lending terms, and taken AC to 5th in the world. Not bad for 9 months of hard work! It will stay open for a few more days, just so we can throw off the dust covers from the holiday and get rolling again.
Profitability - AC was in profit for Q4 of 2013. Our year end is 31/3/14 and I hope to be able to post figures showing profits before exceptionals (mainly our set up costs) for that year end. I know TC has made profits, but I think we are only the second platform to do so, and certainly the fastest to profits. This comes on top of some hefty set up costs and also recruitment of key people in the year (Mark Wardrop being one, and our Head of Compliance Andy Sheppard being another). Q4 was a turning point for AC and I look forward to 2014 with real relish having established the stability we need from profitability.
The future - The industry is evolving. Regulation from April is the first big change. Others have stated they have interim permissions, but nobody does until April. I can say AC does not see any problem in getting interim permission from the FCA, nor full permission. Personally, I think the FCA will request certain firms to become regulated soon after April as they see them as high risk. Ironically, we could be one of the last to become fully regulated as we are a safe option. That is a personal opinion, and a lot will come from how the FCA will play things.
The next big change is institutional money. The Government started the process with £20m going to FC last year and Ratesetter have just taken a large slug this year. The British Business Bank have £300m available to the industry, but personally I think that is a drop in the ocean. The real cash comes from institutional lenders such as hedge funds and banks. We saw a glimpse of this with FC allegedly speaking to Santander and Google, Eaglewood Capital and others invest through Lending Club in the US. The risk is the big force out the small and thus losing the principle force for P2P, especially our fairer world. Personally, I feel there is a place for both but only if the large funds are used to help the smaller investor, such as we have done with underwriting a loan. If AC do ever have institutional money invested through the platform, I will still be looking to ensure our smaller investors get the opportunity to invest or to be able to buy loan units on the aftermarket. P2P has been driven by the crowd and should remain available to the crowd. AC states it offers a fairer world, my personally integrity tells me I need to keep it that way.
Discourse over.
A
