The ability to assess credit risk is fundamental for all lenders. It is an intricate mix of art and science, whereby each lender has its own view when determining their appetite to lend and at what price. While there are some commonalities between each lender’s credit risk models, what is deemed a great business by one may appear less attractive to another.
A “secured loan” has historically required that a borrowing company post an asset as collateral, such as equipment or property, to “secure” the capital that a bank loans to them. Given that this is the predominant type of secured loan, SMEs understandably equate the term with a need to own property or specific types of asset. However, there is another important type of secured loan that does not require collateral in the form of physical assets: the cashflow loan.
As a leading alternative finance lender in the fintech space ThinCats has built a regional network of experts based across the UK. Why? Isn’t the whole point about fintech to digitise and automate?
Once upon a time, Britain was a great manufacturing nation. That’s the perception – was. While it’s true that manufacturing makes up a smaller proportion of GDP – 11%, down from about a quarter in the 1970s – what it does, it’s still world class at.
Building long-term relationships with the regional communities of corporate finance advisers, private equity houses, accountants and commercial finance brokers is a critical part of our mission to deliver better funding solutions for UK businesses.
As a relationship driven organisation, working closely with business advisers through our regional development and credit teams helps us get close to the SMEs that we support and deliver funding solutions that are bespoke for their specific need. In the last year we have worked with a variety of different business advisers, helping numerous businesses secure the funding they need.
ThinCats recently conducted a survey with corporate financial advisers on the current drivers, restrictions and trends in SME financing in the UK. Join us in this brief article as we collate the survey’s results on the funding market for SMEs, including the notable rise of alternative finance as a means to support SME growth.
Technology companies are the UK’s economic powerhouse, growing 2.6-times faster than the rest of the UK economy. Indeed, the 50 fastest-growing UK tech companies claim an eye-watering 2,176% average growth rate and a combined revenue of £1.2bn, according to Deloitte.
How Derbyshire-based sports marketing agency, The Events House, successfully raised £500,000 to grow their business.
Eating out is a British small business success story. Consumer spending in restaurants has risen over the past five years, reaching £22.5bn in the last quarter of 2018. The number of restaurants and mobile food operators has tracked this upwards, reaching nearly 87,000 in 2017.
Small business growth opportunities are being stymied through lack of capital, research has found . This is exacerbated because many businesses feel they are unlikely to get a loan to fund their growth plans.
In 2012, John Northcott, Paul Segal and their team saw the potential of a pioneering design that would change the manufacturing industry and break the timber monopoly. What was once a research project has now become a pioneering brand synonymous with innovation and sustainability
Today we have launched a new £100 million funding programme for private equity backed UK businesses.
We are very pleased to announce that we have provided funding worth more than £400m to over 500 UK businesses since our launch.
We are very pleased to announce a new £20 million funding commitment from British Business Investments, a commercial subsidiary of the British Business Bank.
The high street bank continues its move from community cornerstone to museum piece – to the detriment of Britain’s small businesses.
Staying connected to the regional business communities we operate in is vital. This is why we have teams of boots-on-the-ground funding experts and why we have set up a new base in the heart of Sheffield.
2018 was a breakthrough year for ThinCats. Read more about how our investments in people, technology and data helped us fund more UK businesses than ever before and why business advisers are increasingly turning to ThinCats to create the bespoke funding solutions that their clients demand.
In 2018, we launched PRISM Prospect, our predictive data model based on analysis of hundreds of thousands of businesses over 25 years. PRISM Prospect identifies businesses likely o have a funding need over the next 12 months. The model segments UK SMEs into five propensity categories from very likely to unlikely.
We are pleased to announce that we had a record year for lending in 2018, more than doubling our 2017 figures to £112 million. In total we have lent more than £350 million to UK SMEs.
We are delighted to announce a new programme for £200 million with BAE Systems Pensions, to provide UK SMEs with commercial loans.
Data science and analytics is embedded deep within ThinCats’ business principles. It is the company’s aim, to develop some of the industry's most predictive models; to identify and fund the underserved companies that ultimately drive our economy.
Employee ownership is becoming an ever-more popular way for owners to sell their business. In recent months, firms as varied as book producers, landscape gardeners and a niche operation doing luxury conversions of VW campervans have taken the decision to go down the route pioneered by John Lewis. Even shadow chancellor John McDonnell seems to want to get in on the act
When you take out car insurance do you just opt for the first quote you get, very unlikely. The same goes for a mortgage, an investment fund or a pension plan. You shop around via the internet, a broker or an aggregation service
Employee-owned businesses saw a major boost to their popularity once their advantages were enshrined in legislation through the Employee Ownership Trust in 2014. The EOT is a form of employee benefit trust, but with distinctive features and tax advantages.
We are delighted to announce that ThinCats is now a supporting member of the Employee Ownership Association (EOA) joining a network of over 330 businesses supporting an organisation which puts employees first.
Thank you to those lenders who were able to attend the Investor Conference in London on 11 October. The purpose of the conference was to update investors on the large number of changes that have been taking place at ThinCats over the last 18 months.
What entrepreneurs need to take their business to the next level and what traditional lenders are prepared to finance can be very different things.
We are delighted to announce a new programme for up to £300 million with global asset manager Insight Investment to fund UK SMEs with commercial loans.
How the collapse of global finance a decade ago decimated SME lending and catalysed an alternative
The UK’s rapidly expanding small business sector is something of a sleeping giant, with young companies in need of better access to finance to kick-start their growth. In the transition from start-up to scale-up, a critical factor for a growing business is the quality and flexibility of available funds.
Our Investor Conference is now confirmed for Thursday, 11th October at the Building Centre in London’s Fitzrovia. All investors should have received a copy of the email invitation – if you have not had yours, please email email@example.com with your name and BLN number, and we will be very happy to forward you the full details.
At ThinCats, we have a policy of targeting our lending to growing companies. In doing this, we strongly believe that alternative finance is playing a positive role in increasing the productivity of British industry
SME event-driven finance is fast becoming the natural terrain of the alternative finance industry. Before the financial crisis, banks dominated all areas of business lending. Alternative finance meant getting some money from your mum. But things have changed. Regulation over the past decade has forced banks to retrench. In the years immediately after the crisis, net lending to SMEs fell heavily into negative territory.
British industry is caught in a paradox. There has been a severe slowdown in productivity since the financial crisis, despite the world going through what’s been described as the fourth industrial revolution. It’s as if Watt develops the steam engine, Stevenson builds his rocket, Cartwright unveils the mechanical loom and Britain’s rate of growth somehow still slows.
By opening up new flows of capital to UK SMEs, alternative finance is playing an important part in helping UK talent drive improved economic growth. Read our paper on why the UK should care about finding alternatives to traditional bank funding, the benefits to businesses and the future of funding
The banking network is shrinking, and it is bad news for businesses. The good thing is, there’s now an alternative.
The ThinCats team headed down to the incredible Bristol Planetarium, for a night of networking with local finance professionals, and the opportunity to present ThinCats’ plans and aspirations against the backdrop of the awe-inspiring summer night sky.
A 19th-century icon of the Welsh coast is being developed for the 21st century, thanks to funding from alternative finance provider ThinCats.
The National Football Museum was alive last Thursday with the ThinCats in the North West reception; a band of local finance professionals came down to find out about the latest developments in ThinCats SME funding revolution.
Ninety industry professionals joined the ThinCats team last week to unveil the next developments in the SME finance revolution. The backdrop was the underground bunker where, on becoming Prime Minister in May 1940, Winston Churchill said, 'This is a room from which I will direct the war'.
Firtitudo Ltd has secured a £1m funding facility from alternative finance provider, ThinCats.
Stewart Cazier, our head of retail, was interviewed by Simon Lambert of This is Money on what investors need to know about alternative finance, crowdfunding and the IFISA for the Investing Show.
ThinCats is pleased to have provided Calnex Solutions with growth capital financing, both to enable the acquisition of Belfast-headquartered JAR Technologies and the continued expansion of the combined entity.
WG Carter Ltd specialises in the renovation and construction of high quality residential homes across Oxfordshire and the Cotswolds. In addition to luxury new build projects, the team carefully renovates beautiful country houses and restores them to glory, bringing them up to date with the latest services and decoration, whilst preserving their history and features for future generations.
Just when we had settled into the ‘new normal’ of bargain-basement rates, the Bank of England starts raising them, with a 0.25% rise in November and more could be on the way.
ThinCats is helping shake up a Derby-based linear vibratory systems and parts handling business with a £1m loan to fund an MBO.
ThinCats has delivered a £1,200,000 loan facility to DHR Business Solutions Limited to help fund the company's ambitious expansion plans.
However strong your business proposition, realising it through a cashflow-based loan can be nigh-on impossible through traditional channels. Banks these days are reluctant to lend on anything other than bricks and mortar.
Banking has changed beyond all recognition over the last decade. Many high streets are now with-out a traditional bank as, according to The Times, some 802 branches closed in 2017 alone – a figure that seems certain to accelerate this year.
Our team continues to expand as we appoint Rob Thompson to the newly-created role of regional head of credit for the North.
For our longstanding investors, the name 3DD Productions will be quite recognisable. Over the years they have successfully raised 15 loans through ThinCats, with continuing plans for growth.
Amid current fascination with driverless cars, it’s worth considering how far we are from a driverless credit process, as it were – what do algorithms and AI have to offer, and what still requires human consideration?
Management buy-outs are a staple of the alternative lending industry, and ThinCats has been happy to help a large number of management teams make this happen. Employee buy-outs are somewhat rarer, but this is what has been successfully accomplished.
Submit your best photo encapsulating the new ThinCats style of imagery for a chance to win £500 for charity. T&Cs apply. Find out more
At ThinCats, we listed our biggest ever loan, had our most successful month, achieved full FCA regulation, trebled the Credit, Securities and Origination teams, and completed a full rebranding programme, ending with our new website which launched on the 14th December – a fitting end to a great year.
You will see that the ThinCats website has been given a make-over – a look that is being reflected throughout our materials. Our new look has come about after a huge amount of development and growth within ThinCats. Therefore, we are proud to unveil the new ThinCats and are very excited about the year ahead.
The £100m of funding will see our UK-wide network of Origination Managers supporting those companies in the manufacturing sector that require a level of capital to take their businesses forward, and prepare for 4IR.
Articles include: Loan origination boosted with five hires | IFISA Progress | Lender fee to be introduced for new investors | ThinCats’ largest loan sets sail | Rewarding sustainable manufacturing
ESF/ThinCats announces £200 million funding programme to support lending to UK SMEs ESF Capital, together with its operating subsidiary, ThinCats, has concluded a funding programme for loans of up to £5m for growing UK small- and medium-sized enterprises (SMEs).
Articles include: Institutional funding programme launched today | Matters of risk | Keeping the shine on a vintage local business
W. Bruford is a chain of retail jewellery shops operating on the south coast, which was looking to refinance after their long-term bank changed their lending criteria. Business owner Ashley Pugh joined as general manager in 2001 and then led an MBO in 2003.
There have been a number of developments at ThinCats recently, such as our full authorisation by the FCA, and improved arrangements for back up service provision to protect our investors, which impact our Terms and Conditions; we have therefore updated and reissued them to investors today.
Articles include: Capital erosion: dangerous descents | Looking out for the UK’s overlooked SMEs | If you want to avoid breaking your IT systems, break your IT systems
ThinCats is thrilled to announce that the company has been granted full authorisation by the Financial Conduct Authority. The approval highlights the company’s commitment to protecting consumers and developing the alternative finance industry as a vital source of capital for businesses, and income for investors.
It’s possible that Edmund Hilary and Tenzing Norgay weren’t the first people to make it to the top of Everest. When George Mallory’s body was discovered on the slopes of the mountain 75 years after he disappeared in 1924, it was apparent he was descending, having been last seen 800 vertical feet from the summit
There used to be a rule of thumb in pension planning, that the percentage of bonds or other income-bearing securities, in one’s pension portfolio should equal one’s age. Things are somewhat more complicated and that, hopefully, has been replaced by more grounded and detailed analyses.
P2P investments can play a vital role in retirement planning. Over the coming months, we will be taking a look at key issues around P2P loans and retirement planning.
We outline below the ThinCats policy for loans listed on the platform which are underwritten by ESF. Where a loan is underwritten by ESF, they may also choose to take a minimum investment in the loan. Details of this will be set out in the information pack which is available to lenders.
We are delighted to announce that ThinCats has been ‘Highly Commended’ at the Business Moneyfacts Awards in the “Innovation in the SME Finance sector” category, for the ThinCats loan grading system.
From our analysis of the market we anticipate lower average loan rates, along with an increase in loan quality. These linked trends are a confluence of events in the wider alternative finance SME loan market – indeed, debt markets generally – and ThinCats’ own due diligence.
Diamonds are a peer-to-peer lenders’ best friend, as Shirley Bassey sang. Or meant to, we’re sure. Cardiff’s finest export will doubtless have had many a diamond stocking filler at this time of year.
2016: the year we built on the foundations It’s that time of the year, where tradition expects we review the previous 12 months, typing out our thoughts as mince pie crumbs scatter the keyboard. It was ever thus, with annual reviews probably going back to cuneiform script on clay tablets.
ThinCats is pleased to announce its patronage of NACFB. The National Association of Commercial Finance Brokers is a trade body for business finance mediators, founded in 1992 in response to the growing incidence of fraud in the commercial finance arena.
You want to go to cinema, but what to see? Easy – just pick the film with the highest rating. Five stars and you’re front and centre, with super large bucket of popcorn. Western, scifi, romcom, action – doesn’t matter, just so long as it’s got the most stars.
A core goal for ThinCats is to increase the volume and range of deals available to lenders on the platform. As all our loans are introduced through Sponsors and other business professionals, it’s vital that we develop our relationships with those best able to provide the lifeblood for SME P2P lending.
Introducing new introducers A core goal for ThinCats is to increase the volume and range of deals available to lenders on the platform.
Using the new loan gradings: Balancing risk and reward Should you invest in a loan that isn’t four or five star? Five star loans aren’t ‘good’ and one stars ‘bad’, any more than AAA-rated corporate bonds (of which there are vanishingly few these days) are good, and high-yield bonds bad.
We are pleased to introduce a new specialist Sponsor, Community Chest Business Loans Ltd, offering peer to peer loans for Social Enterprises that attract tax relief.
The update issue Times past, ThinCats had neither the resources to carry out extensive development of the platform, or to keep our lenders adequately informed. But that is changing. We have been putting considerable capital towards supporting lenders, and are allocating more.
As you know all of the major peer to peer platforms are in the process of applying for full authorisation by the FCA. As part of this process we have been reviewing our client money procedures and we need to introduce a few changes immediately that might affect you.
The last 24 hours have been interesting. The Brexit decision will undoubtedly have an impact on the British, European and World economies. Some of these impacts will have been foreseen and some will not.
Gin loan raises spirits Gin has come a long way from Mother’s Ruin. However, access to finance can be a ruinous experience for a young gin distilling company trying to make its way in the world. Founded in 2013 by Mark Hensby and John O’Dowd, Liverpool Gin set out to provide “super premium organic gin”
Europe’s biggest platform for secured P2P business loans has auctioned Europe’s – and possibly the world’s – largest non-property peer-to-peer (P2P) loan. Insurance group LAMP has listed a £3.5m loan on UK-based lending platform ThinCats.
Towards the Innovative Finance Isa The birth of the Innovative Finance Isa (Ifisa), set for April, looks likely to be met with enthusiasm by investors.
The Innovative Finance Individual Savings Account (or “IFISA”) is due to be launched on 6th April but they can only be offered by peer to peer platforms that have achieved full FCA regulation and so far none have achieved that status.
Welcome to the first edition of the ThinCats newsletter. We open with a look back and forward at the start of the year, with major developments taking place with the business and the peer to peer market.