shuff27
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Post by shuff27 on Mar 22, 2017 13:15:37 GMT
As a modest investor in BM (c.£9k) I'm following this topic with interest as it seems to be morphing into what kind of investor should consider BM, and vice versa.
I originally chose to invest in BM as I thought I'd like at least one platform (out of the 6 I currently use) to be an 'invest & forget' type. However, and I suspect this applies to many of us who use this forum, I'm beginning to realise that my 'investing temperament' is to be very hands-on and that therefore BM doesn't suit me - which doesn't imply any criticism of BM or Steve Findlay.
Would be interested to hear others' thoughts on this.
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oldgrumpy
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Post by oldgrumpy on Mar 22, 2017 13:30:22 GMT
"However, we get a disproportionate number of queries from clients with smaller balances (£1,000-2,000)..."
I've had £1000+ waiting in my "bank account" for most of March so far (out of a total of £10,000+ which I have built up but struggled to keep lent out since last August). How can I be expected to invest more? BM struggle to maintain even 90% deployment (mine is 88.7% this morning). Any "full deployment" emails last only for a day or so. My current calculations on the last seven months show an expected return around 6.5% and currently less than 6.6% with no leeway for defaults. I think 7% over the full year to August 2017 is going to be dreamland. Then the defaults .... (loans 1596/1597). Not crystallised losses yet, but if they do, that will be £160 out of net interest earned so far of £279 including accrued. That would bring achieved interest after fees and losses of about 2.8%, so I (and many others who have given BM a chance) will be watching VERY carefully.
I also do not think the fund deployment situation of c90% for "mature" accounts is going to improve while lots of new funds flow in. BM can't keep up.
I look forward to BM placing actual ongoing performance figures for each persons account on the site so we don't need to do our own (possibly errant) rough calculations.
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Post by Deleted on Mar 22, 2017 14:16:03 GMT
Although, like I said, I'd be happy for BM to take a few months to deploy capital if the underlying due diligence was solid, I would also agree that stating things such as "Effortlessly earn 7.0% p.a" and "It can take 7-28 days for your funds to be fully deployed" should rightly be questioned if not delivered.
Also, "wire funds and relax (using our autobid function) or stay on top of your individual selections - keeping you in control of your funds on a day to day basis".
How do we control individual selections? How would I for example sell a single receivable?
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Post by khampson on Mar 22, 2017 14:40:04 GMT
I am a small investor at the minute with £2500, I liquidated my account 5 weeks ago as I needed the the funds short term, I replaced the money (£2500) just over 4 weeks ago, my settings are 1% investment and currently I half of my funds deployed 49% with 45 loans, I joined BM because I liked the deposit and forget idea, I do not have time or knowledge to pick out the better looking loans and was increasingly worried about my investment with FC, since I joined I have been logging in several times a day to see how things are going, sadly I expected more and still do but I want to give it time, since joining last July I have been lucky that I've had no defaults.
I am concerned that as I am only invest a small amount that BM do not value me as a client as if fully deployed I would only add £25 but I think my £25 is as important as someone else's £10 and regardless of having 1k or 100k we are all treated the same, I have asked many questions to Stephen on this forum and via email and to be fair he has always come back, to be honest I would accept a lower rate say 6% just to be fully deployed, I would rather lend 98%+ of my account at 6% than 50% at 7%, I know that you communicated leading up to Christmas that loan volume dropped across the peer to peer sector but that was 3 months ago.
I really do like BM and I really want to stay, I have 25k coming shortly and want to put it here but I cant justify it at the moment knowing that I cant get my funds out, I don't have many questions left to ask but I have 1 that I asked last week that still hasn't been answered so I will ask again.
When can I expect to be 98%+ invested, is there a times scale? do you have information about this that you can share, that is all I need to know, at the minute I need to decide where I go from here. If its never or if its 6 months at least I know.
I appreciate that least the communication we get from BM is good but please do not let the wheels fall off and be as open and honest you can be with us, if not I can see a lot of unhappy people walking away with a negative opinion.
I will hang around a little longer as I understand that a platform needs time to find its way and things don't happen overnight so I will wait as other have said to see what happens over the coming weeks.
regards
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Post by eascogo on Mar 22, 2017 19:00:41 GMT
As a modest investor in BM (c.£9k) I'm following this topic with interest as it seems to be morphing into what kind of investor should consider BM, and vice versa. I originally chose to invest in BM as I thought I'd like at least one platform (out of the 6 I currently use) to be an 'invest & forget' type. However, and I suspect this applies to many of us who use this forum, I'm beginning to realise that my 'investing temperament' is to be very hands-on and that therefore BM doesn't suit me - which doesn't imply any criticism of BM or Steve Findlay. Would be interested to hear others' thoughts on this. As far as spreading risk BM is difficult to beat. A 1% spread takes a lot of time to achieve elsewhere. It can also be assumed that BM careful vetting procedure minimises potential losses. In terms of returns BM notional 7% is some 3% below what can/should be achieved given the same spread on platforms such as eg FS, MT, or SS. Even higher returns of 14% to 16% are on offer if concentrating instead of diversifying investments. For example FS adds bonuses on investments of 5k or 10k in a single loan, and higher bonuses are available for larger sums. To the middle-of-the-road investor such high concentration may not be acceptable but a few may take the jump. For those in a position to absorb a big loss a 'risky' 15% may win over a 'safe' 7%. Fingers crossed!
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Post by stevefindlay on Mar 22, 2017 20:18:27 GMT
To be fair it's not really poor performance just poorer then expected.keystone - I am sorry that you are disappointed. Sincerely. We work very hard to try and deliver a great experience for all clients, and don't like to learn that clients are unhappy. Also, I think you make a good point - we've tried very hard to make our product suitable for retail clients of all sizes - from £1,000 to £1.0M. However, we get a disproportionate number of queries from clients with smaller balances (£1,000-2,000) asking questions which appear to confuse us with a bank current account / guaranteed returns / easy-access etc - seemingly new(er) to investing. (To be clear - I'm not saying that you are necessarily in this camp) How do you distinguish between a smaller investor and an investor who maybe spreading their investments over a number of platforms
SF - We would look at each investor based on their holdings with us.
and if you present the information then you should be prepared for questioning of that information regardless of the amount invested.
SF - we are happy to do this, and we do do this
Either way it's better to present the information rather then not present it to smaller investors.SF - It's the servicing of questions that follows from that information that makes the smaller investors unprofitable. Its not that the questions aren't fair - its just that it doesn't make business sense to operate a model where we make £10 a year from a client who contacts Customer Services 3-5x per year. Investing isn't easy and achieving good returns over the long run is difficult. It requires careful judgement and patience. True, but then if you raise expectations by highlighting expected returns over 1 year when you really mean over the longer term,
SF - we've always said 6-12 months+ We have lots of investors who seem to expect the return to be instantaneous (less than 1 month).
and fail to meet your again expected deployment time frame you should be prepared for having to explain why.
SF - fair enough on deployment time. I'm pretty confident that we've always been open about the challenges here though. I think our product may need tweaking: we probably share too much information with smaller investors, and try to enable them to get as good a return as possible (but this introduces uncertainty). I suspect we would be better off either (i) shooting for lower returns for smaller investors and do this in a simpler way (including introducing a tie-in period) or (ii) restricting our service to just High Net Worth Individuals and/or Sophisticated Investors. I think that approach is wrong, information is the key, you can never have too much information, trying to limit information and returns to smaller investors rather than providing an explanation of defaults for example smacks of an admission of failure, and a bunker mentality, retreating to HNW investors who don't question. Again I'm amazed that anyone would invest £25K and not want to question the defaults.
SF - if we have £10k in a loan that goes into default which is spread across 1,000 clients at £10 each; we have to enter into (quite rightly) many more conversations than if it spread across 100 clients at £100 each - on average we would have 10x fewer conversations. We're not trying to avoid the difficult conversations (we never have), it just that its proving uneconomic to service so many smaller clients who are equally vociferous.
SF - I have a lot sympathy for not showing a different information set to smaller investors - that does feel unfair. So it may be that we just have to cut out smaller investors altogether.
I think option (ii) would be a shame, as we want everyone to be able to access the returns available in this sector in a better way. However, for our business to succeed we can't spend all day holding the hands of many clients that only yield £10 of revenue per annum (i.e. 1% from a £1,000 account). I really do think that's a bit naive, surely you expected more questions from newer investors
SF - agree - we do expect more questions from investors early on.
or those with smaller holdings,
SF - what we've seen is that the number of questions is similar for each client - regardless of holding size. But the cost to service those questions is the same regardless of whether it is a £1,000 client; £10,000 client or £100,000 client.
maybe you could be cutting off investors who maybe testing the water before committing further funds or who may like your model and increase holdings later.
SF - maybe.
But if you say changes to allocations will be coming soon 0.5%, rounding down, etc then implement them
SF - we are, but these all take time.
rather than getting rid of these pesky smaller investors who are too much bother. I've withdrawn some funds, but I'm still invested with BM, but won't be adding further until you add smaller allocation features and better able to communicate defaults. Your a good communicator stevefindlay but I think BM have been raising expectations too much
SF - really? I admit that deployment has been slower than we like, but I'm not sure we've inflated expectations anywhere else. I'm sorry if you feel that we have.
and failing to communicate the platform model and the risks!
SF - I think that is a little unfair. We are clear that capital is at risk etc.
Wait for the questions to really start coming in when the defaults start to rise.
Food for thought...
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Post by stevefindlay on Mar 22, 2017 20:20:53 GMT
As a modest investor in BM (c.£9k) I'm following this topic with interest as it seems to be morphing into what kind of investor should consider BM, and vice versa. I originally chose to invest in BM as I thought I'd like at least one platform (out of the 6 I currently use) to be an 'invest & forget' type. However, and I suspect this applies to many of us who use this forum, I'm beginning to realise that my 'investing temperament' is to be very hands-on and that therefore BM doesn't suit me - which doesn't imply any criticism of BM or Steve Findlay. Would be interested to hear others' thoughts on this. - I fully agree with this assessment. Many people want a hands-on approach, and BM doesn't really do it for them - which I fully respect and understand. For those wanting more a fire-and-forget type approach, with a team of people working on their behalf, then BM should fit the bill nicely.
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Post by stevefindlay on Mar 22, 2017 20:23:32 GMT
Although, like I said, I'd be happy for BM to take a few months to deploy capital if the underlying due diligence was solid, I would also agree that stating things such as "Effortlessly earn 7.0% p.a" and "It can take 7-28 days for your funds to be fully deployed" should rightly be questioned if not delivered. Also, "wire funds and relax (using our autobid function) or stay on top of your individual selections - keeping you in control of your funds on a day to day basis". How do we control individual selections? How would I for example sell a single receivable? You can choose to partially liquidate at any time - enabling you to scale back or remove certain positions.
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Post by stevefindlay on Mar 22, 2017 20:31:26 GMT
I am a small investor at the minute with £2500, I liquidated my account 5 weeks ago as I needed the the funds short term, I replaced the money (£2500) just over 4 weeks ago, my settings are 1% investment and currently I half of my funds deployed 49% with 45 loans, I joined BM because I liked the deposit and forget idea, I do not have time or knowledge to pick out the better looking loans and was increasingly worried about my investment with FC, since I joined I have been logging in several times a day to see how things are going, sadly I expected more and still do but I want to give it time, since joining last July I have been lucky that I've had no defaults. I am concerned that as I am only invest a small amount that BM do not value me as a client as if fully deployed I would only add £25 but I think my £25 is as important as someone else's £10 and regardless of having 1k or 100k we are all treated the same, I have asked many questions to Stephen on this forum and via email and to be fair he has always come back, to be honest I would accept a lower rate say 6% just to be fully deployed, I would rather lend 98%+ of my account at 6% than 50% at 7%, I know that you communicated leading up to Christmas that loan volume dropped across the peer to peer sector but that was 3 months ago. I really do like BM and I really want to stay, I have 25k coming shortly and want to put it here but I cant justify it at the moment knowing that I cant get my funds out, I don't have many questions left to ask but I have 1 that I asked last week that still hasn't been answered so I will ask again. When can I expect to be 98%+ invested, is there a times scale? do you have information about this that you can share, that is all I need to know, at the minute I need to decide where I go from here. If its never or if its 6 months at least I know. I appreciate that least the communication we get from BM is good but please do not let the wheels fall off and be as open and honest you can be with us, if not I can see a lot of unhappy people walking away with a negative opinion. I will hang around a little longer as I understand that a platform needs time to find its way and things don't happen overnight so I will wait as other have said to see what happens over the coming weeks. regards "Timescale": for fresh funds being deployed today, we are now expecting deployment within our 28 day target for 2% settings. We've completed the long-awaited sign up of some key lending partners in the last couple of weeks and these are already beginning to come through and are beginning to clear the back log. "A lot of unhappy people": genuinely, this isn't the experience we are seeing across our client base. The vast majority of clients 75%+ by number (90%+ by value of funds) appear very happy with the service. I do recognise that some clients have been disappointed (quite rightly) with deployment rates (as have we) - but this is just one aspect of the service.
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adrianc
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Post by adrianc on Mar 22, 2017 21:52:55 GMT
...I replaced the money (£2500) just over 4 weeks ago, my settings are 1% investment and currently I half of my funds deployed 49% If you'd left it on the default 2%, you'd probably be fully deployed now...
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Post by khampson on Mar 22, 2017 22:28:10 GMT
Thank you for your reply, I like the concept of BM on paper, hopefully things will start to pick up and I can start to deploy more money, the unhappy was purely based on comments filtering through on this forum and I fully understand that this is a tiny proportion of your clients and most people who are happy probably don't comment at all.
It's great to see that we can start to see the new platforms loans start to come through.
I chose the 1% settings purely to give me better diversification having a relative small portfolio.
I have waited around since July last year so I am not going anywhere just yet, BM deserves a good 18 months before I can be sure, I think it's unfair that people only try a platform for 2 or 3 months and then go saying it's not what they expected.
Anyway I am getting good vibes and hoping I have many more happy years here.
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adrianc
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Post by adrianc on Mar 23, 2017 9:01:18 GMT
I chose the 1% settings purely to give me better diversification having a relative small portfolio. The trade-off to which, of course, is slower deployment. My own account is set to 1% - but I waited until I was fully deployed at 2% before changing it. A small account is actually less important to be widely diversified. 2% is £50. 1% is £25. So the increased risk between the two settings is just £25. Sure, as a percentage of your investment, that's the same as on a larger account - but it's still not a massively significant amount in the grand scheme of things, in terms of actual £ notes. On a bigger account, it may be £250, or £500. There's two thresholds to cross. Firstly, there's the "I really do not like this" threshold - and that's very easy to cross quickly. Then there's the "I really DO like this" threshold - and that's the one that takes a lot longer.
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arbster
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Post by arbster on Mar 23, 2017 9:11:33 GMT
I chose the 1% settings purely to give me better diversification having a relative small portfolio. The trade-off to which, of course, is slower deployment. My own account is set to 1% - but I waited until I was fully deployed at 2% before changing it. I invested in this way too, and started with BM with my eyes open, expecting there to be uninvested periods. This is exactly how it is with my self-managed investments - occasionally I find myself with funds uninvested because of slower deal flow (MT) or poor deals (SS). I'm definitely now favouring the hands-off approach that BM allows, and I will simply drip-feed cash in as and when I become fully invested. If it takes on average a week to invest 4% of my portfolio then I won't deposit more than 4% per week. Simple.
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oldgrumpy
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Post by oldgrumpy on Mar 23, 2017 9:29:23 GMT
Although, like I said, I'd be happy for BM to take a few months to deploy capital if the underlying due diligence was solid, I would also agree that stating things such as "Effortlessly earn 7.0% p.a" and "It can take 7-28 days for your funds to be fully deployed" should rightly be questioned if not delivered. Also, "wire funds and relax (using our autobid function) or stay on top of your individual selections - keeping you in control of your funds on a day to day basis". How do we control individual selections? How would I for example sell a single receivable?Stephen side-stepped in his answer to that one.  You can't. We'd all sell (or try to sell) our 6% bits and keep our 12% bits! 
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brad
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Post by brad on Mar 23, 2017 14:12:07 GMT
...I replaced the money (£2500) just over 4 weeks ago, my settings are 1% investment and currently I half of my funds deployed 49% If you'd left it on the default 2%, you'd probably be fully deployed now... 3 weeks since adding 2K to existing 1K, which was fully deployed in a matter of hours, and it's gradually getting there - 87% deployed on 76 loans. Settings left at 2% and will probably be always left at this due to the fact i do not always get the max £70 per loan. Sometimes £10, £20, £30 etc up to £70, which suits me fine.
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