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Post by Financial Thing on Nov 25, 2015 14:53:51 GMT
When Fruitful opened its doors in Feb 2015, I decided to take a gamble and invested a four figure sum as I liked the staff communication, simplicity, liquidity, goats and the business model.
Several weeks ago I received an email stating Fruitful would be closing its doors to the P2P lending model of its business for several reasons. The email explained that a portion of invested returns would be credited immediately (75%) while the remaining 25% would be credited within 12 months.
I sent an email to Fruitful asking for more details but didn't receive one back. A little concerning to say the least.
As promised the 75% was received four weeks after the closing email.
Overall Fruitful was a good experience and I'm sure I will receive the remaining 25% (with interest) at some point but needless to say this is an email you don't want to see in your inbox and is a reminder of the risk that is P2P lending and how if a platform closes its doors, how little recourse there is for the average investor without paying hefty lawyer fees.
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pom
Member of DD Central
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Post by pom on Nov 25, 2015 16:33:55 GMT
.. I liked the staff communication, simplicity, liquidity, goats ... Well that was definitely a USP 
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Post by p2plender on Nov 25, 2015 16:39:15 GMT
Introduce a friend and receive a free goat.
What's not to like?
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Post by Financial Thing on Nov 25, 2015 17:17:48 GMT
Fruitful's service was "bahhh" none
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Steerpike
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Post by Steerpike on Nov 25, 2015 17:36:24 GMT
The system seemed to be designed to nanny the users
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Post by ablrateandy on Nov 25, 2015 17:44:28 GMT
Are they bearing the wind-up costs or are lenders dividing the bill-y?
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Post by Financial Thing on Nov 25, 2015 17:48:02 GMT
and let the puns begin...  |
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adrianc
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Post by adrianc on Nov 25, 2015 17:50:05 GMT
I hope they were kidding.
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Steerpike
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Post by Steerpike on Nov 25, 2015 18:13:44 GMT
The innovative approach was designed to buck the trend but trying to ram through a new idea resulted in a herd of silly billies.
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james
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Post by james on Nov 25, 2015 18:23:28 GMT
It looks as though Fruitful was funded in part via a £140k for 8% equity Crowdcube crowdfunding. Company value thus £1.75 million based on that value for 8%. I don't know why the news story has different values from the Crowdcube site. Anyone know what's happening to the money of the equity crowdfunding investors? I assume that they are facing a 100% loss of their money. Optionstrader isn't so badly off from getting 75% back early but the equity funders may not be and I'm not sure it's really very polite to have most of the initial replies to a possible serious loss of money be jokes. |
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Post by trentenders on Nov 25, 2015 19:00:26 GMT
Optionstrader isn't so badly off from getting 75% back early but the equity funders may not be and I'm not sure it's really very polite to have most of the initial replies to a possible serious loss of money be jokes. Ignore the trolls (under their bridge)
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kermie
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Post by kermie on Nov 25, 2015 19:05:35 GMT
Financial Thing, what was the security model with Fruitful? Who are you lending to - Fruitful or the end-borrower? What about security - were the loans backed by assets? And finally is there a separate Trust of some kind to ensure sensible wind-down? I am surprised you've got so much back so soon - I guess this implies the loans have been sold on to some third party?
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Post by westonkevRS on Nov 25, 2015 19:06:10 GMT
I think if Financial Thing can joke, after possibly losing 25% then fair enough with the puns. I was a small equity investor via crowdcube. To be honest this was just as a fan of P2P, It was always a stretch. Secured short term professional property borrowing can be profitable within the P2P market, but low cost residential long dated lending was always going to be a stretch. I must admit the bigger concern is the valuations and expected returns (that I don't think will ever materialise) with crowd equity. It's pie in the sky stuff and should only be for fun, anyone expecting to get a return or back the next Google is dreaming. I think this type of investment will shortly go out of fashion, unless the valuations and businesses become more later stage and reasonable. Kevin. |
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Post by Financial Thing on Nov 25, 2015 19:07:07 GMT
It looks as though Fruitful was funded in part via a £140k for 8% equity Crowdcube crowdfunding. Company value thus £1.75 million based on that value for 8%. I don't know why the news story has different values from the Crowdcube site. Anyone know what's happening to the money of the equity crowdfunding investors? I assume that they are facing a 100% loss of their money. Optionstrader isn't so badly off from getting 75% back early but the equity funders may not be and I'm not sure it's really very polite to have most of the initial replies to a possible serious loss of money be jokes. To be clear, Frutiful isn't closing their doors, just refocusing on mortgage lending. So I presume equity investors aren't losing anything.
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Post by Financial Thing on Nov 25, 2015 19:10:26 GMT
Financial Thing , what was the security model with Fruitful? Who are you lending to - Fruitful or the end-borrower? What about security - were the loans backed by assets? And finally is there a separate Trust of some kind to ensure sensible wind-down? I am surprised you've got so much back so soon - I guess this implies the loans have been sold on to some third party? Loans were ring fenced and between investor and end borrower, backed by property that the loans were made against. You can read about the wind down here
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