OFF3R Unveils Index for Alternative Investment Market

Highlights its position as the place to go to make informed alternative investment decisions

OFF3R today launches an independent Index outlining month-on-month performances of equity crowdfunding and peer-to-peer (P2P) lending platforms over the last year.

OFF3R analysed major equity crowdfunding platforms including Seedrs, Crowdcube, Syndicate Room, Angels Den, Envestors and The House Crowd. The P2P lending platforms examined were Zopa, Landbay, RateSetter, ArchOver, Marketinvoice, Lending Works, Funding Circle and Thin Cats.

The Index shows that equity crowdfunding raised a combined total of £216.25 million and P2P facilitated a combined lending of £2.6 billion.

Commenting on the report Lex Deak, CEO and co-founder at OFF3R said: “Our Index is part of our mission to educate and empower investors to make informed decisions and get better returns. We’re excited to be launching this report at such a critical time.”

 “Traditional investors have had a tough year: interest rates hit record lows, inflation rates are set to increase and the economy is suffering from Brexit uncertainty. These events alongside low returns are encouraging investors to consider alternative investment options.

On the crowdfunding side, Deak commented:  “As the market matures investors would like to see larger businesses turning to the crowd which may put pressure on the current £4 million limit. At the same time, we should see more standardisation in the way in which account and finance information is presented. This will make it easier for investors to be able to compare opportunities. 

Onto P2P, Deak commented: “P2P continues to be popular with investors, the market increased amounts lent during the post-Brexit period, with September being the strongest performing month on record with £234 million being lent. The Government has bought into its potential and the market is increasingly robust.”

Key findings

Equity crowdfunding

  • An average amount raised per month of £18 million across the seven platforms
  • 80,000 investments were made, with just fewer than 400 funded deals
  • October 2015 to December 2015 was characterised by a high growth trend, due to investor confidence in the asset class, a selection of large fund raisers and the state of the broader macro-economic environment
  • December 2015 was the best performing month of funding with £26 million raised
  • January 2016 to September 2016, represented an approximate 25 per cent drop off in raised activity between these months and the previous year
  • Two events during 2016 shows crowdfunding is an established player aligned with wider investment sentiment: the FTSE three-year low in January 2016 and the post-Brexit fallout

P2P lending

  • An average amount lent per month of £197 million across the eight platforms
  • April 2016 showed a seven per cent drop due to a number of factors, such as Lord Turner’s negative comments about the P2P market and Lending Club’s loan book discrepancies scandal
  • Slight drop in total lending throughout June and July 2016
  • August 2016 lending increased 20 per cent – the biggest month-on-month increase in their data
  • September 2016 was the strongest performing month with nearly £234 million bring lent

Author: Dylan Jones

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