littonowl
Member of DD Central
Posts: 398 
Likes: 355
|
Post by littonowl on Jan 21, 2017 17:32:31 GMT
Welendus were on these boards towards the end of last year, suggesting they're looking to disrupt the short term consumer loans market via P2P.
I see they're now looking to raise cash ahead of a soft launch of their platform this quarter. Apparently there will be an early lenders bonus available and Seedrs investors will be the first in. Lenders will be able to choose their own return between 5-15%.
I like the concept here, and think it could be an interesting one...both as a lender and a small investor.
Never invested via seedrs before, but wondering if you are ever likely to see a return? If so, how? Doesn't seem to be any SM on seedrs, so presumably its only if the Company decides to pay dividends (unlikely in early stage) or if they eventually float as a PLC?
|
|
|
|
Post by mrclondon on Jan 21, 2017 18:12:07 GMT
littonowl - correct there is no SM on seedrs (or similiar crowd funding sites). Speaking in general terms and not specifically about Welendus, you should not normally expect any dividends from such investments for many years, and you should expect, over time, probably a majority of such investments will become worthless. If the investment is offering EIS/SEIS tax relief the shares MUST be held for 3 years otherwise you have to refund HMRC the tax relief obtained so consequently companies do not tend to plan an exit strategy in the short term. For those few companies that are successful, the exit strategy will normally be by trade sale to either a competitor company or private equity investment fund. In a few rare cases the exit will be by IPO (initial public offering) on AIM for example. I'm utterly bemused how a company that hasn't even started trading can attract equity support with a c. £4m valuation. (Take a moment to think about the long stop valuation of AC of £25m which may be foisted on the AC convertible notes holders in a few months. There is some concern that may be hopelessly overstated, despite their 3.5 years of trading and obvious success in the market place. See this analysis from samford71 for thoughts on how to attempt to value a p2p platform).
|
|
ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
Posts: 11,315
Likes: 11,523
|
Post by ilmoro on Jan 21, 2017 18:39:45 GMT
Welendus were on these boards towards the end of last year, suggesting they're looking to disrupt the short term consumer loans market via P2P. I see they're now looking to raise cash ahead of a soft launch of their platform this quarter. Apparently there will be an early lenders bonus available and Seedrs investors will be the first in. Lenders will be able to choose their own return between 5-15%. I like the concept here, and think it could be an interesting one...both as a lender and a small investor. Never invested via seedrs before, but wondering if you are ever likely to see a return? If so, how? Doesn't seem to be any SM on seedrs, so presumably its only if the Company decides to pay dividends (unlikely in early stage) or if they eventually float as a PLC? Correct. The exit plan is in the docs. Takeover by larger player or IPO. Most Seedrs/Crowdcube etc investments need to be considered as long term investments. A couple have had quick exits Camden Brewery for example and some do allow some trading of shares eg Chapel Down/Curious Brew is NEX listed, Brewdog has trading periods on PrimaryBid (still both fairly illiquid). Otherwise you are pretty well locked in unless you can arrange a private trade through the platform (Seedrs will facilitate this) I think the lastest exit (first by IPO here ) was actually at a discount to the Seedrs valuation so any investors looking to exit would have lost money. For small scale investors there is also the danger of dilution with further raises as the share class offered doesnt usually include pre-emption rights, Not relevant in this case I think. The valuation looks a little toppy in this case and I think share price is at a premium to that valuation. They also dont have first mover as TMP have already launched. Their USP seems to be their guarentee fund and expect that wont survive FCA authorisation in its current form as the regulator doesnt like anything that smacks of an insurance scheme. 15% on unsecured, high risk lending isnt particularly good when you can get 12-13%. No estimates for bad debt provision I can see. Not sure about it, might make a small contribution (Biggest downside, no free beer for investors, big fan of that sort of perk  ) Edit crossed with MrLondon as typing very slowly whilst watching football - now laughing too much at LLoris
|
|
littonowl
Member of DD Central
Posts: 398
Likes: 355
|
Post by littonowl on Jan 21, 2017 23:31:18 GMT
Many thanks to mrclondon and ilmoro for your detailed responses. All things considered I don't think unlisted equity investment's for me. The very fact that the majority of small businesses fail within 5 years, means the odds are stacked against you seeing much (if any) of a return in these start ups and you'd probably need to cast your net far and wide to hit a winner to compensate losses elsewhere, and I simply don't have the capital. That said, I will be watching the launch of their platform with interest, as a potential 15% return is certainly enticing, though I expect the level of defaults may have a say in the real return...? |
|
Neil_P2PBlog
P2P Blogger
Use @p2pblog to tag me :-)
Posts: 355
Likes: 209
|
Post by Neil_P2PBlog on Jan 22, 2017 15:38:35 GMT
I'm utterly bemused how a company that hasn't even started trading can attract equity support with a c. £4m valuation. (Take a moment to think about the long stop valuation of AC of £25m which may be foisted on the AC convertible notes holders in a few months. There is some concern that may be hopelessly overstated, despite their 3.5 years of trading and obvious success in the market place. See this analysis from samford71 for thoughts on how to attempt to value a p2p platform). Flender recently raised £500k for 10% on seedrs www.seedrs.com/flender so Welendus must be hoping for something similar.
|
|
dandy
Posts: 427
Likes: 341
|
Post by dandy on Jan 23, 2017 10:08:52 GMT
if the investment is EIS (which it is) the valuation is effectively much less as you get 30% of your investment back through tax relief - for a start this reduces the implied valuation by 30%
you then get further tax relief if you "lose" the other 70% (company folds etc) of up to 45%.
so if you invest via EIS in a company that ends up failing you get back ~ 65% back in total
so if welendus has a valuation of £4m under EIS then you are effectively buying in at at £2.8m and possibly less (depending how the company fares) and PROVIDED you have sufficient tax bill to fully cover any relief - you also pay no CGT on any gains
|
|
|
|
Post by sayyestocress on Feb 2, 2017 17:15:15 GMT
Right now it's 28% funded with 47 days to go. How does that fair for a typical Seedrs campaign? I've not really paid Seedrs much attention till now so have no idea, curious if anyone out there knows.
|
|
|
|
Post by buttchopf23 on Feb 3, 2017 14:15:00 GMT
Maybe worth mentioning that one user bid 16.1%. Half what was bid so far.
Btw: I joined myself with some gambling money.
|
|
|
|
Post by sayyestocress on Feb 27, 2017 16:28:01 GMT
If anyone who hadn't invested is interested; the 300k fundraise was cancelled and replaced with a 100k target fundraise. The company valuation remains the same, there's just less of it up for grabs.
|
|
TitoPuente
Member of DD Central
Posts: 624
Likes: 655
|
Post by TitoPuente on May 8, 2017 20:26:02 GMT
Couriously this never took off. I have been following this as an option to diversify my lending. Can anyone with an equity position shed some light on launching plans?
|
|
|
|
Post by buttchopf23 on May 8, 2017 21:11:13 GMT
I don't know more... I had invested gbp 100. Before closing the round they were expecting FCA authorisation shortly. As far as I know, this has not materialized to date.
|
|
|
|
Post by buttchopf23 on May 11, 2017 14:10:29 GMT
They will give shareholders an update this week. As of no, they are not fca authorised.
|
|
kermie
Member of DD Central
Posts: 691
Likes: 462
|
Post by kermie on Nov 24, 2017 13:14:50 GMT
They are back on Seedrs today - looks like pre-emption has been running for a few days already.
I'd not read much about them, but the name rang a bell, so I thought, OK, let's go look at their website and see what loans are on offer....I mean, after all, the valuation is £4.6M, so I'd expect a bright welcoming home page offering lenders a bunch of loans at juicey rates, and borrowers the opportunity to get a quote.
Nope: "Coming soon....register your interest here...."
Then a bit more digging suggests they tried to raise 300k in Jan 2017 - and then what?! Still not trading since then? Back in January they claimed to be aiming to soft-launch in 2017Q1....they claim their credit model has been verified by over 500k of loans - but there's precious little indications of that on their website - perhaps all the origination had been via brokers - but even so I'd expect their website to be bragging about something....anything! What has been going on for the past 10 months?
Bit disappointed really.
Any existing shareholders have any insights?
|
|
|
|
Post by buttchopf23 on Nov 24, 2017 13:49:52 GMT
Yes, I invested in the last round. This round opened yesterday or the day before with one investor who put in 100k.
Platform should go live in November, so any day now. It took them longer then anticipated to get fca approval.
|
|
|
|
Post by buttchopf23 on Dec 2, 2017 22:05:07 GMT
Platform is live (beta), no loans, just funding until there is enough cash to give loans (if I understood that correctly).
|
|
)
