And here we go with another one. The platform has its domicile in Estonia, but the team is located in Latvia. On first sight it looks familiar with Envestio, Monethera or Kuetzal. Even the cashback scheme is familiar, you will find it at the end of this post.
On the second sight there are key differences, though. As the other marketplaces do their credit and risk analysis in house, Wisefund buys it from an expert company called Nord Capital Markets.. I like the approach to delegate to an expert instead of trying to reinvent the wheel. Sadly there is not that much I could find about Nord Capital. I believe it is this company. Should be accurate as it is operating since 2009, but it seems there is only one shareholder. I do not find any reference to credit analysis on their page. If I have a look at the Homepage, it looks more like a company for trading strategies. It is a pitty, that I am not able to verify given information on Wisefunds website easily.
Registration and Deposit
Investors residing in the European Union (+ Switzerland) or having a bank account in this are can sign up with Wisefund. Creating an account is easy, you need a valid email adress and an identification document. After verifying your email you can log in and upload your ID, plus you need to take selfie holding the document as well. It takes two business days tops to get the verification done. After this you can top up your investor account. I was surprised to see that the marketplace has its bank account with a Hungarian Bank, OTP (largest Hungarian Bank) to be precise. In my opinion this is a weird setup. They say they had problems opening an account in the Baltics as a new crowdfunding player. Seeing how Envestio struggled with its bank account the past weeks, I find this explanation reasonable.
Currently there are 3 projects listed, of which one seems to be already funded. Yields vary from 17.3 to 19.7 percent and have durations of 4 to 8 months. The railway loan is from Switzerland and I can see in the business registry that it is active. I try to get to know more about this one through Wisefund.
Minimal ticket and buyback
According to FAQs the minimum investment per loan is set at 10 Euro and capped at 10 percent of the total loan volume per project. Also per FAQs overdue loans of 60 days plus are bought back directly without any fees, but accrued interest is not covered. So they provide a full capital protection. Interestingly they have an agreement with a mysterious investor who buys all overdue loans from them.
Conclusion and Cashback
As you can see some questions remain open, but this is usual for new marketplaces. I hope I can get some answers in due time and will update once I have something. If you want to try the platform, use this link for registration and get 0.5% cashback for the first 270 days of your investor journey. Please be cautious as this is a brandnew marketplace and high risk. There is no free lunch, and for sure not 20 percent yields without risk.
Within Fintech (of which p2p is a subcategory) we can observe new alternatives for overnight accounts lately. We have the well know Bondora Go & Grow, the somehow different approach from Bondster as well as p2p giant Mintos’ Invest & Access (which I did not check out to date). And now there is Ibanwallet.
Ibanwallet , an old acquantaince
During 2017 I had my first contact with Ibanwallet, as they have been fundraising on Seedrs, where they sold some equity in their company to get funding for their venture. I was in contact with the the founders ( Daniel Suero Alonso und Marc-Anthony Hurr ), but did not invest in the end. I really cannot remeber why I did not invest, but it for sure it was a red flag, otherwise I would have remembered.
Two years later and we went from the idea to a rolled out and functional product (not many start-ups even get to this stage). I have a feeling this product is just the first in a series…. Now the serious question: what service or product do they provide (it is available as an app or via website)? …..
So what is this ibanwallet?
There are two words in the name: IBAN, a number of a bank account like we are used to it and wallet. It is a newly developped bank account, with quick acces to the money, like the cash in our wallet (for those who still have a wallet and use cash of course ;)) Wow, a bank account (which we can only use through our reference account where we deposit from and withdraw to), not that game changer on the first thought 😉 BUT, there are certainly features which are very interesting: There are 4 versions of “accounts” available: 1) a call money account with an interest rate of 2.5% per year with daily interest payments, plus three more as term deposits with daily termination option. You see them below and they pay from 3 to 6% annually with durations of up to 5 years.
The investments are terminateable on a daily basis, but there occurs a fee. All accrued interest up to 2.5% will be lost if the account is terminated early. But never more then really accrued, so no capital loss. So, i.e. only 0.1% accrued, only 0.1% is lost. aufgelaufen, werden auch nur 0.1% storniert, man verliert also kein Kapital. If you, for example, terminate a 1 year investment after 11 months, you still get 0.25% (2.75% accrued interest minus 2.5%). On first sight not that attractive for p2p guys, but in comparison to bank accounts it is really good. Never forget the rule that liquidity has its price. If you want maximum flexibility, you get less return. Mid July I deposited 550 Euro on my ibanwallet and got like 3 to 4 cents interest daily (depends on the roundings ;)). After 10 days it looked like below (and now of course even better).
Sign up and get a Bonus
Sign up as an easy and straight forwar process which can be done within some minutes. You need a document for identification and a mobile phone number. After that you see your personal IBAN number with Ibanwallet and can fund your account from your personal bank account. I sent the money on its way in the morning and it was credited in the evening. Everything went smooth and fast. To unlock the withdrawal, you need to upload a statement of your bank account containing your name and adress. As well this step took only minutes. Use this link to register (the field promo code should be filled out directly during registry, if not let me know.) and you will be awarded 25 Euro sign up bonus, as soon as you have depositet at least 1’000 Euro (I get the bonus as well). You can do with your bonus what you like and with it you net at least 5% yield during the first year with your call money account (2.5% on 1000 Euro = 25 Euro plus 25 Euro bonus).
How does Ibanwallet earn money to pay interest?
Ibanwallet understands itself as something new and basically does the same thing as a traditional bank. But what does a bank do? Basically, a bank takes deposits from clients (= money on bank accounts) and lends it out as mortages or loans for example. The difference between what they receive from the borrowers and what they pay the depositors is called the interest difference. And this is the money the bank earned by its activities. This is just a very basic explanation, but in general very true and stands for what a bank should do.
Ibanwallet does the exact same thing. They take deposits and lend them out. But iin what do they invest in? And now it gets interesting. Ibanwallet invests the money in p2p loans. Sadly I was not able to find out in which platforms or loans. Though I know that they only invest in loans with buyback guarantee or loans which are asset backed, like property. I try to find out more about this topic and others (like controlling of liquidity etc).
I like the easy handling of the website and its lean design (alternatively you can use the app, which I have not until now). Everything works smoothly and as expected. If you compare interest rates with other Euro bank accounts, the return is great. But of course there are risks which you should think of (so never park your total liquidity on one account only). Ibanwallet operates in a fairly new market (p2p) and is operational for just some time as well. There can be risks (operational, market etc). It is possible as well that your money is invested with the same platforms or loans you already invested in (if you do p2p yourself). None the less I think ibanwallet is worth checking out. The team is not on the website at this stage, but above you see the links to the founders linked in pages. Daniel is a banker and entrepreneur and Marc-Anthony the Math and IT-Guy, a good combo it seems. Here you get to the sign up and the 25 Euro bonus (for at least 1’000 Euro Investment)
Dear Readers, I am honored to present you the first guest post on my blog, by a frequent reader, who visited DoFinance and might start his own project one day. Everything below is from the feather of diversified bull, and he has a special offer for you at the end of the post. Enjoy.
This is a review of DoFinance that I visited at the end of May 2019. I have been an active p2p investor for the past 8 years and this review is based on my experience of the platform: I currently have €35k invested with them and discussed with the management team when I visited their Riga office.
I would like to start by thanking p2phero: I discovered early a few platforms thanks to his valuable posts and his opinion is always relevant. We exchange on investment ideas from time to time and he kindly offered me to post on his blog the feedback of my visits to a few Latvian platforms earlier this year. I will start today with DoFinance, which have just answered my follow-up questions after my visit in May.
DoFinance has been at the top of what I would call my “third tier” platform list for a while. Third tier in terms of size, less than 5,000 investors, and transparency, no financial statement and limited statistics.
However, we know that diversity is essential in the p2p landscape and it is always worth identifying a promising loan provider. The interview that the two DoFinance co-founders gave a while ago to the well-known blogger Lars Wrobbel aroused my interest. I decided to investigate further and, although the financials of Alfa Finance, the group behind the platform, are not public, the resumes of the founders can be found on LinkedIn and give some insight. Two brothers Janis and Viesturs Kulikovski funded the group together with Ingars Zagorskis. Viesturs Kulikovski spent 8 years at Swedbank Latvia where he was a member of their management board before his departure in 2001. He also has extensive experience in real estate investment. We can expect he has gone through some market downturns in his career and is more risk-aware than some 25-years old startupper sometimes running these companies nowadays. His brother Janis has an international business background, including running operations in Indonesia, which gives some credibility to their loan origination business in the country. They claim on their site nearly 700,000 registered customers in total as of May 2019 and 182 employees worldwide. This should give some depth to their loan offering and I was curious to learn more about them.
They were very quick to respond to my request for an appointment and I could meet them in person two weeks later. Their office is situated in a charming district of Riga, next to parks and museums, in a typical historic building of the city. Luckily, it was just one block away from the apartment I was staying in. When I arrived, I was greeted by the platform lead Henrijs Jansons who showed me their premises and then introduced me to Viesturs and Janis. We had a one-hour meeting and they openly answered all my questions. They gave me the impression of trying to grow their business in a controlled manner. They have a complete vision of the process: from the loan origination to the issuance and the distribution on the platform and up to the recovery of delinquent loans. Development in Indonesia seems to be an important step for them with hundreds of thousands of customers and a large locally based team in charge of the origination and the debt collection processes.
I provide here a summary of the main topics we discussed during the meeting, my questions and their answers that they fine-tuned in the follow up emails we exchanged:
The site provides not much recent information about Alfa Finance Group, statistics are from 2016 – 2017 in the About Us section. In the blog you recently mentioned an NPL rate of 6.18% but with little information about what it means, the perimeter and the cohort of loans measured. Would it be possible to provide more up to date and detailed information of the loan performances by region. Also any financial statement of Alfa Finance or its subsidiaries would be useful to assess the buyback guarantee (BBG).
DoF: We get this question quite often. We plan to publish shareholder report once every 6 months. And also we have renewed our website with the latest statistics and some other information.
Autoinvest does not reinvest interests which creates a cash drag if funds are not withdrawn or reinvested immediately. Investing the paid interests requires a manual intervention, do you think you can provide a simple solution to this in the future?
DoF: Yes, we are currently developing updated auto-autoinvest functionality with possibility to choose if funds are reinvested, collected to investors DoFinance profile or withdrawn to bank account (there will be minimal automatic payment limit of 25 Eur).
The Indonesian p2p market is still at an early stage of development. According to their financial authority OJK, non-performing loans and defaults in Indonesia’s P2P industry were 6.3 per cent of all loans in February, up from 2.4 per cent a year earlier. Are you facing the same deterioration in your portfolio?
DoF: Fortunately, we have quite the opposite case – the NPL’s have decreased since December and we see positive trend. We have managed this by integrating with automatic ID and docs verification + introduction of employer calls (that is a common practice in the banking sector in Indonesia) to verify the customer. Such verification later helps to collect overdue loans as well.
In addition to the specific nature of the Indonesian p2p market, we have to remember that loans are originally denominated in INR (Rupiah) while us, end investors, receive euros. In the extreme scenario of a depreciation of let’s say 30% of the Rupiah, are the positions hedged or are you confident the originator will be able to absorb the losses?
DoF: We use the services of remittance companies (Ebury.co.uk and Monex.com) to reduce currency risk. Additionally, this year there was an election of president and parliament (they held them at the same time for cost efficiency) and same president and leading parties won, thus the country should remain stable and no controversial laws or regulations are expected to be passed.
Are there some situations (like the one described above) where the Indonesian loans would suffer a loss and the BBG fail, while the Polish loans would continue to be protected? Are they both guaranteed under the same umbrella or are they independently protected i.e. can Credo data Indonesia default on the BBG while it is still maintained for Polish loans?
DoF: Since our group is only in 30 day loans and all Risk department is centralized here in HQ, we can monitor and adjust risks, scoring cards etc monthly and do not suffer unforeseen increase in NPL. Moreover, at the moment ~80% is shareholder capital and only 20% are available for investment in platform. Additionally, all our loan originators are licensed and closing one would not affect the other.
In summary, DoFinance is, in my opinion, a solid choice in the p2p space and should be on the list of any investor looking for diversification across multiple platforms and originators: from invoice financing to personal loans in Poland or Indonesia. The team is competent and committed to the long-term development of the platform.
Then, they clearly have room for improvement as far as transparency and disclosure are concerned. At this stage of their development though, I don’t have an issue with it, especially after meeting them. I invest mainly into their indonesian loans offering the highest rates. I am not yet convinced by the lower yielding alternatives but it is always nice to have the choice. I personally intend to grow my investments with them.If you are interested in investing with DoFinance, this is a good time to do so as they are just starting a new 1% cashback offer from 08/07 to 31/07/2019. This will apply to all your investments in the 9% and 11% programs for a term of 6 months or more. In addition, I can sponsor you for a VIP account and you will get an extra 1% yield on some of the auto-invest strategies. To enjoy the VIP status, follow the usual registration process with DoFinance and also submit your email to http://copula.atspace.eu/dofinance/. After a few days, you will receive confirmation that your DoFinance account has been upgraded.
Tezlombard offers a kind of pawn shop loans on Bondster. Most of the loans are backed by physical gold or jewellery, but the ltv is quite high. The loans are perpetual, theoretically can run for years and only serve interest. As an investor you get a cancellation window of 3 to 4 days per every 30 days, in which you can get out of the loan. Without any costs incurring, you just need to know when to do it. If you miss the opportunity, the next window will be there in 30 days latest. So not a real overnight money account like with Bondora, but for this you get the doubled yield. On the negative side you are less liquide and the risks are higher. As I already said the loans yield 13 percent and can get bought backed after 60 days in delay for not serving interest installements. In this case you get your capital plus all accrued interest.
Autoinvest got updated and enhanced
The autoinvest feature was enhanced with some more settings. I, for my part, run with the old settings. But a very cool feature added are the Diversification settings. Once activated these try to balance the investments with all selected loan originators. This is really helpful in my opinion. I am testing this feature currently, as I want to know what happens if there are no loans of one originator. Stays this share in cash? Hopefully, and for sure not. There are some questions popping up 😉
At the end / Cashback
Bondster really gets better and better. My delayed loans quota is in line with other marketplaces and is different depending on the originator. Of course my observation period is a bit too short to draw conclusions, but this is about to change. Curently I am really happy with the platform. It seems the marketplace is an insider’s tip, but also this is about to change, I am sure. Bondster can be easily compared with the Baltics peers.
New investors still get 1% Cashback for the first 3 months. If you want to participate in it, you need to put 4985 in to the promocode field at registration. Here you go to the registry. You will get the cashback directly credited on to your Bondster account on every fith of the month. But this happens only after you already are invested for at least 30 days. So the first credit might take a bit longer
Some days ago a reader asked me where at the moment he could get the highest interest rates. But with moderate risk, of course. So what is moderate risk? I don’t really know, I guess this is something depending on the indivual assesing risk. If I look at 10 year German Government Bonds, I see a return of minus 0.2% annually. So if you invest 1000 Euro now, you get 980 Euros back in 10 years, nice deal 😉 This is the price for absolute security. Well theoretically, even Government can default. But why did I use the 10 year yield to maturity as a gauge? In finance, these returns are used in most financial models and are referred to as the risk free rate.
Ok, that was just introductional, but I think we needed this. If I compare this minus 0.2 percent to the highest yielders of 22 percent, it is no rocket science to see that this is absolute high risk territory. An absurd credit spread of 22.2 percent. If I use this comparison, I would say moderate risk is at the lower band of this bandwith, so around 2 percent or so, but for sure not in the p2p sector. As I said before, moderate risk is different to any investor and derives from two main factors: 1) risk capacity, this is the answer to the question if you get in trouble if your invested money is lost. 2) Risk tolerance is the question after point 1 is ok. In this case you might have the capacity to absorb the loss financially, but psychologically. What is it worth if such investments keeps you awake at night because you fear to lose it? No point in investing, if you cannot handle it. But no, off to the overview.
Crowdestor leads the pack currently
There already were some projects on Crowdestor which yielded 21 percent with a duration of plus minus one year. Currently there is a project, see bottom, in funding and at the time of writing 82 percent filled. I am sure there will come some more projects the next few days. With Crowdestor you better have cash ready at the marketplace to be able to hit the invest button before the projects are already filled.
Kuetzal – the youngest
Kuetzal as well has its share of projects yielding 21 percent. These are filled slowly, but it does not matter to investors, as the interest calculation starts immediately after investing. Here you can read up on Kuetzal.
Envestio – the quickest
With Envestio the projects are filled up within minutes or up to 3 hours, if it is a bigger amount funding. Even if Envestio currently pays only around 17 to 18 percent, the projects are funded within no time. Before you invest, you might want to read my older posts (here, here and here). You need to have funds on the marketplace before a new projects turns up, otherwise you will be late.
And there is Bulkestate
At first I did not want to include Bulkestate in this list, but with 17 percent interest rates it somehow matches. Smaller projects are filled within minutes. Bigger projects can take 3 weeks, but will get financed in the end by some big hitters or so. I really like their projects and approach to not add too many projects, but quality. They are building a solid track record currently of repaid projects.
And we are at the end….
I really have no clue why projects at Envestio are filled quickest (is it the cashback?). I doubt it is because of the minimal investment ticket of 1 Euro. Does it really matter if the minimal investment is 1, 10, 50 or 100 Euro? I doubt that. To summarise, the most trustworthy platform of these 4 are Bulkestate and Crowdestor. This does not mean that they are less risky, also they will face delays and defaults, that is sure.
Currently there is no project in delay according to the marketplaces. Or do you have different information?
Well, nearly a half year went by since my last post about Envestio . Who has read my previous posts (here and here), might remember that I am a bit critical towards the marketplace. The performance of the platform although left a positive impression. Installements were on time, so I should not lament. Exactly this is a point, which I still find weird: no lates (or did you have some?) or something, only business as usual? This just leads me to believe that not every installement is paid directly from the borrower. I can imagine a scenario where the borrowers have allowances (and for some projects you see them in the description), and the repayment is taken from the allowance. Important for me is, that we see new projects on the marketplace, not more tiers of existing projects (which is okay to have, but not exclusively). Most projects on the platform are not rateable for me as I have no clue about wooden pellets or fish 😉 But recently there were projects I could proxy a bit.
Crypto Mining Projects
Firstly I try to explain for what crypto mining is needed, I am no expert in this field, so forgive me my superficial approach. Mining basically approves transaction within its network, at least with Ethereum. So if A send 1 ETH to B, this must be confirmed by the network, and this is what miners do. Some transactions together go into one block, and who finds the block, gets a reward in Ethereum. But this network can do more, there are apps on it (dapps = decentralized applications etc). So there really needs to be miners 😉
During the past weeks there were two such projects added on the marketplace, with a volume well over 1 Million Euro. In the project description we can see that the borrower got an order to build a mining rig containing of GPU’s. At first I thought now way there are GPU’s costing 900 USD per piece, but GTX 1080ti GPU’s are that expensive, and there are others which cost double. Money for which you get a good laptop, but this may be comparing apples and oranges. The nice thing about mining is, that it is calculatable and therefor we know the profitability. I used whattomine.com to calculate the profit. I was very fair and assumed electricity costs of 0.05 USD per kilowatthour(KWh). If you mine Ethereum, then you make 61 cent net per day, so amortising one card has a duration of 1475 days. Not the best point to start I think. Surely there are more profitable tokens to mine, but with less market cap and less volume to trade, so price swings are normal. Furthermore these results are from one point in time. Usually the mining gets more difficult when more people start mining, which happens when prices are increasing. As long as the difficulty increases less then the price, everything is okay and profitability is better.
At the moment everything is fine in Envestioland, but I think one should really think twice before investing in mining. It really was glad to see that these projects filled in more time then others. So people are actually watching in where they invest in. Don’t get me wrong, basically I really like Envestio’s idea: Support companies and help the economy grow. This safes jobs and creates more. For investors it is great as well, fund a great cause and get high yields. But with high yields, normally comes high risk 😉
New Investors get 0.5% Cashback (for the first 270 days) plus 5 Euro starting bonus, if you register through this link. There are not always projects available, so best strategy is to deposit some money and act quickly once you get a notification about a newly added project.
Currently there are lots of special deals for new investors from various marketplaces. Others have no incentive, but offer lucrative projects to invest in and have announced a full pipeline
Kuetzal offers sign up bonus plus cashback to new investors
Some weeks ago I published my first post about Kuetzal . In the meantime I have received my interest payments on time. Of course it is too early to tell if Kuetzal is worth the risk, but at the moment it seems to be a promising platform. New investors get 10 Euro sign up Bonus plus 0.5% cashback on your invested capital during the first six months. You need to sign up with this link and press register. In the field promo code, enter P2PHERO . After you have invested at least 100 Euro, 15 Euro will be automatically deposited to your account, plus 0.5% on your investment. On top of this promotion there is a special Cashback promotion which started in June. To me the cashback looks like being calculated as per investment, not summed up.
Lenndy offers starting bonus
I really liked Lenndy in the past, but the further development lagged, so I did not spend much time on it. Recently they picked up and got rid of paysera and have their own bank account integrated. For sure a plus is the constant deal flow. Remember: Only loans with the shield icon are buyback protected. If you want to start with Lendy now, you can get 10 Euro as sign up bonus (if you use this link to register). By the way, they offer an autoinvest feature, but the autoinvest only grabs newly published loans after you set it up and activated. It does not invest in loans already available. I will update my review about Lenndy during the next weeks.
Bulkestate announced lots of new projects
Bulkestate recently announced by email that they will have a lot of investment projects in the coming months. Three of my projects have matured and were paid back on time . There is no cashback currently, but the yields of the projects are great. I am satisfied with the platform, but I really hope the deal flow increases as expected. Follow me to Bulkestate.
Crowdestor lowers minimum ticket
No cashback, but good news. The minimal investment amount has been lowered to 50 Euro per loan. This means you can diversify more with the same amount of money. There are plenty of offers at the moment. Currently a 21 percent project. Crowdestor really kicked it during the last weeks. Better deposit some money on the marketplace, as the great loans fill quickly. Follow me to the marketplace.
Start with Neofinance and get 25 Euro
Lithunian marketplace Neofinance, which operates very profesional in my opinion, offers 25 Euro Bonus to new EU investors. Register through this link.
As you might know I joined Bondster during Q4 2018, actually a bit early for an update. The recent changes made me do one. There are lots of good news for investors which I want to share. Furthermore some Investors seem to have problems configuring the autoinvest. I had that trouble as well when I began using the marketplace. Let us start with the good news for investors:
No more fees on Euro Investments
Until Wednesday investments in Euro have been charged by an annual fee of one percent, so lowered the interest received. This fee began charging once the first three months were over. Since Thursday this fee is gone (but new investors still get 1% cashback, details at the end of this post), which already impacts our yields in a positive way. The fee is still applied on the Czech Krona investments. The second nice point for us is:
Loans with up to 13.5% interest rate and buyback
Bondster has proven themselves by adding new loan originators, matching their risk criteria. This must be a very tough due dilligence review, as Bondster promises to step in, should a loan originator default. This week Lime from Poland was added and already offers a huge number of loans. Furthermore Bulgarias Stikcredit offered 13.5% on a smaller lot of loans. If you like the ore conservative approach, there are more loans from originators which haven been in business for years now. Oh, by the way, Stik and Lime offer short term loans of up to one month.
Late and Penalty fees
A recently changed fact is, that if a loan is past due date, investors still get compensated for the overdue period. There is just a little difference with how much. If in the loan details there is written “no penalty fee” it means, that the loan interest just runs at the same rate. If a loan is yielding at 13.5 percent, this rate is appied until buyback kicks in. If in the details there is written “penalty fees yes”, the interest accrues until the due date as it is written and then afterwards the penalty fee applies. I guess it is at least the same as the interest or more, otherwise this distinction would not make any sense. I hope this explanation was clear.
Autoinvest feature – sometimes less is better
Yes, the autoinvestor played games with me as well, lol. I had several people reaching out to me about it. Therefor I decided to share some info about it. First, I really think Bondster wanted to create a sophisticated autoinvest tool for us, hence we got a lot of parameters to set. And there seems to be the problem, some settings might not work together or we simply do not understand how to set it right. In experience it is enough to select the originator (or leave it empty to select all), the minimal interest rate, maximal duration and include buyback (currently obsolete, but I want it future proof). Below you can see my settings:
Once you clicked save, you see the overview of your autoinvestor, and there is a really helpful detail: Foundloans shows you how many loans match your criteria. My settings result in 292 loans. With this number, you can see if your settings are ok or not.
Beforementionned changes really make Bondster more attractive in my opinion. Short term loans with 13.5 percent yield, plus overdue covered, this is really competitive. Further I like the regional diversification with a platform outside the Baltics.
New investors get 1% Cashback on their investments, if you register (follow link) and put this number, 4985, in the promo code field. This is valid for the first three months after registry. Cashback is directly credited on your investment account on the 5th of every month, for the investments of the past month.
A little more then one year ago Crowdestor has started its services and begins to thrive right now. The first ever financed project was paid back some days ago (others already repaid before) and there are three investible loans on the platform right now. Afourth will be online for funding on Wednesday morning, more on that at the end. First i was a bit sceptical about the marketplace or to put it better, the first project. With some time past now, I am more confident about them then a year ago. For sure the projects are of higher risk, but you get compensated by very attractive interest payments (like Kuetzal or Envestio . Interest starts to accrue from day one, which of course an advantage. I am convinced that at some point at least one loan gets delayed or worse. To counter that a bit, I guess the buyback guarantee fund was founded.
Buyback Guarantee Fund
On March 1st Crowdestor announced that they had launched their buyback guarantee fund and initially funded it with 50k Euro. Further there will go one to two percent of each projects fee into the fund. Such a mechanism we already know from Lendy, formerly Saving Stream. They believe the fund will be worth about 100k by years end. Achievable if the funding of loans reaches 2.5 to 5 Millions of Euro. Seems to be quiet a bit, but given the rate at which new projects are going live and funded, I believe it is doable. I just question how much 100k will help when compared to a 500k project. It might be enough, as mostly loans default down the road not at the beginning and if there are securities in place. Let us hope we won’t have to find out ;). Last but not least the funds rules are not clear to me. I hope the marketplace will soon define them clearly. n
New Project on Wednesday at 19 percent
Wednesday morning a new project will go live for 520k Euro at 19 percent yield and very short duration of 9 months only.. My gut tells me this one will be funded quickly. I do not have more information on this project currently. It looks like a real estate project in Riga. Follow me to Crowdestor.
Kuetzal, what a weird name I first thought. So I asked them why they branded them like this. See the answer from Alberts, CEO and Cofounder:
“Initially we wanted to name the platform Quetzal. It is a rare bird which Aztec and Maya tribes considered as sacred. The bird is associated with trust, magnificence, brilliance and we decided to use this name. Another reason is we wanted to differ from competitors which have a lot of invest, lend, crowd in their names. The market is overloaded with such names so we decided to bring freshness. We just made a change from Quetzal to Kuetzal as we believe it will be more Europe-oriented name.“
Well, I guess the differentiation was successful 😉 The platform’s headquarters is in Talinn, Estonia and was founded by three young entrepreneurs. Interest rates vary from project to project and top at 22 percent. Kuetzal offers some special features, which I would like to discuss a bit further.
Kuetzal Care and the Buyback
Most new platforms have a hard time getting their first loans funded, which is in turn a pain for new investors, as their money is on the platform not earning interest. This is different with Kuetzal, as interest accrues from the moment the investment is made into a project (minimal investment 100 Euro per loan, monthly interest payments). This is part one of Kuetzal Care. Second part makes sure that every project will be funded completely. Creditline with banks and money from Angel Investors makes this possible. The buyback feature is not included in every project, it is mentionned in the summary table of each project. If buyback is available on a loan, you can instantly sell your loan part to the platform directly, but they only refund 90 percent. So you basically lose 10 percent of your initial investment as a penalty. This means that you can sell a 20 percent yielding project after 6 months and make no loss (as the monthly interest payments covered it), should you need money before maturity. We know this functionality already from Envestio.
Brand new: Cashback and Sign up Bonus
At the moment you can get 0.5% Cashback on your investments during the first six months after registration. Use any Kuetzal link (like this one) and click on register on the site (right top corner). This offer has no expiration currently. Plus, there is a sign up Bonus of 10 Euro. To get it, insert SPRING2019 in the promo code field during sign up. On top of that there is a Cashback for investments from 1k Euro (see picture below) All Bonuses will be directly credited to your investment account.
You see, this marketplace has its own and very different approach. This should not be seen as bad news. What I don’t like is their lack of focus. They focus on ideas and not sectors or segments. Comforting on the other hand is, that they got funding approved from banks and angel investors. Something which you don’t secure without a deep due dilligence by them. These institutions do not throw their money at a project easily. As per today no project has matured, so no assessment can really be done at the moment. Take for granted that these are risky investments (like Envestio or Crowdestor). As expected I got all my due interest payments on time and I am hopeing this will continue. Follow me to Kuetzal.