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Crowdfunding
Lender
Posted: 31 January 2013 16:17:02(UTC)
#1

Joined: 31/01/2013(UTC)
Posts: 6

Thanks: 9 times
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Hi All,

I'm new to this site / forum, whilst I have made a post in the 'Alternative Finance' topic I thought perhaps it may be better to create a seperate topic for crowdfunding/ p2p/ p2b. Apologies for the doubling up of posts.

Anyway.

I've recently heard alot in the press about crowdfunding/ p2p/p2b and have seen that there are a number of players in the market, I've learned that the main players are Zopa, Funding Circle and Rate Setter, with there being a number of New comers too such as Funding Knight (http://tinyurl.com/avg499s) and rebuildingsociety.com ( http://tinyurl.com/rebuildings ) .

So to cut a long story short, I'm interested to hear from an experienced savvy investor perspective, what everyone's thoughts are on this new alternative finance market . Has anyone had any experience in it ( either as a lender or borrower)? I've noticed that there are various different forms of crowdfunding too, such as equity, debt ect, does anyone have any opinion on which is better in the short/ long/ medium term ?
Any tips on how to approach lending to businesses on these sites?

I look forward to hearing from you, and learning from your experiences.

Thanks
Clive B
Posted: 31 January 2013 17:18:17(UTC)
#2

Joined: 25/11/2010(UTC)
Posts: 446

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Was thanked: 98 time(s) in 62 post(s)
I've used Funding Circle - lending money for interest. You can decide the lending rate and who you wish to lend to and in what amount. I've now pulled most of my money out. The returns after bad debts weren't enough to make it worthwhile. Money made is subject to Income tax rather than CGT and there's no allowance for bad debt. I found that my low volatility corporate bonds were making me more money and I don't have to pay Tax on my corp bonds.
jeffian
Posted: 31 January 2013 17:21:21(UTC)
#3

Joined: 09/03/2011(UTC)
Posts: 181

Thanks: 26 times
Was thanked: 139 time(s) in 71 post(s)
Lender,

There was a thread on this subject a few months ago. Maybe worth looking at the responses there.

http://moneyforums.cityw...-TO-PEER-INVESTING.aspx

1 user thanked jeffian for this post.
Peer2businessLender on 18/03/2013(UTC)
arthur death
Posted: 03 February 2013 15:17:04(UTC)
#4

Joined: 03/01/2012(UTC)
Posts: 1

my experience shoud be a warning,to date accountreads:
earnings £1150
loses£1111
gross yield 8.4%!!!
lending appears to be casually easy and chasing late payments so slow that they turn in to bad debts.

including my experience above,two other investments i know of would not invest again
the old mantra is true again:if it appears too good to be true,it probably is
Happyp2b
Posted: 19 March 2013 10:20:37(UTC)
#5

Joined: 18/03/2013(UTC)
Posts: 5

Was thanked: 1 time(s) in 1 post(s)
arthur death;17843 wrote:
my experience shoud be a warning,to date accountreads:
earnings £1150
loses£1111
gross yield 8.4%!!!
lending appears to be casually easy and chasing late payments so slow that they turn in to bad debts.

including my experience above,two other investments i know of would not invest again
the old mantra is true again:if it appears too good to be true,it probably is



just out of curiosity Arthur, which lending platform were you using, and how did you go about bidding? Did you have autobid ( or similar apps) set ? Similarly did you do any of your own research or did you rely on the platform ratings?

I've been using FC as well but have recently switched to using new comers due to the better rates of return available at present. I have not enabled any autobid functions and enjoy doing my own research into the financial state of the businesses I'm going to lend to, and take note of the security on offer as well. I've found the platforms really helpful and open and have often asked them questions directly about the businesses listed.

So from my experience alone I'd say that crowdfunding has the potential to make good very good returns for lenders, and this can only be increased through lenders doing their own amount of due dillegence and through not investing large chunks of cash in to a single business.
stephens1
Posted: 29 March 2013 12:41:38(UTC)
#6

Joined: 29/03/2013(UTC)
Posts: 1

Hi CW Members

I am new to the forum and are using a crowd funding platform to raise finances for my company which is a startup which will be offering shares under the SEIS (seed enterprise investment scheme)

Although I do not have vast experience with investing/investments after working on my plans and aims believe that the SEIS is a great opportunity for investors into early stage companies if the said company qualifies to offer shares under the SEIS - as the tax relief removes the potential risk of a major loss

Investing £10,000 In A SEIS Risks Just £200 Of Your Cash

http://www.iexpats.com/i...-just-200-of-your-cash/

Former Dragon * Entrepreneur, Doug Richard, who says the SEIS is "One of the most extraordinary incentives ever created"

Over the last few weeks , I have come to the conclusion that this would be a outstanding for an investor who was considering moving abroad as an expat - I say this for the following reasons (and please feel free to correct me if I am wrong as only my thoughts)

If the person considering moving abroad and they owned a second home the CGT could be invested into shares under the SEIS scheme - the CGT which otherwise would be paid to HMRC

50% OF THE SAID INVESTMENT COULD BE APPLIED TO ANOTHER PROFIT MAKING INVESTMENT

The original investment would receive an equity share, and dividends paid to support the expat living expenses while domicile

Dividends paid year upon year whilst original investment grows - which if help in the qualifying company for 3 years would be CGT Free when the shares are sold on in the future or bought back from the company in question

I see this as a win win win situation and one of the great aspects of the SEIS tax relief scheme's

Please leave your thoughts on this , as like I say I am new to the world of investment but eagar to learn as I think investment is a two way thing and each should be working to capitalise on the rewards
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