LendInvest has reported its second profit only two years after launching.
The company recorded a profit of £3.1m and £15m in revenues for the year ending 31 March 2015, according to LendInvest’s latest accounts. In 2014, LendInvest achieved a £1.2m profit and £5m in revenues.
Christian Faes, co-founder and chief executive of LendInvest, said: “LendInvest has shown that the P2P platform model can be made into a real business – one that makes money.
“The world of P2P is a slightly bizarre one in that there’s a lot of talk about how much platforms are lending. But for the industry to mature, investors should start looking at how viable underlying business models are, rather than simply how much a platform has lent.
“Lending money is easy. Lending money well is much harder. At LendInvest we are lending substantial volumes but, more crucially, we are a profitable business without having to rely on external funding to stay alive.
“We are proud to lead the way as the first P2P platform in the world to report two consecutive years of profit and forecast more. LendInvest’s performance to date makes a strong case for P2P as a permanent fixture in the makeup of UK financial services, as well as an attractive and investable asset class.
“Like all fast-growing fintech businesses we have major growth aspirations and serious designs on disrupting the mortgage market with technology. But, it’s always been our game plan to create a business model that makes money too – generating profits that can be reinvested into recruitment and tech development, or deployed to keep our own debt lines short.”
LendInvest launched in 2013 as the world’s first peer-to-peer marketplace for property and has lent over £400m in the UK’s short-term mortgage market. It is the fourth largest UK P2P lender and the biggest P2P platform to focus on property globally.
Through its online platform, LendInvest matches individual and institutional investors with UK property entrepreneurs looking for mortgage finance for up to 36 months.
News of further profitability comes after LendInvest secured the UK’s largest ever Series A round – a £22m investment – in June 2015 and received the P2P industry’s first European credit rating.
LendInvest’s central London team has doubled in size to 60 since the start of 2015 and has attracted senior executives from global brands including Microsoft and IG Group to strengthen its management team.
As well as its online platform through which individuals can invest directly, LendInvest runs two institutional investor funds that manage over £100m which is invested online alongside the individual peers. Since inception investors have funded 700 mortgages on properties worth £0.7bn and enjoy average returns of 7.5% per annum.
LendInvest claims that through its proprietary technology it can reduce the time it takes to decide on a mortgage application from the average three months to just a few hours and that this speed and efficiency is attracting £100m of applications per month, of which a quarter are approved. LendInvest supplies loans to 10% of the £3bn short-term mortgage market.