An Edinburgh fintech firm that enables users to spread their investment across several peer-to-peer (P2P) lenders including LendingCrowd has today announced a £500,000 crowdfunding bid.
Orca is raising the sum via Seedrs, whose backers have included tennis champion Sir Andy Murray, to fuel its “ambitious” growth plans as it aims to become the “hub” for alternative lending.
“This is us set to really realise the next big phase of Orca,” said Jordan Stodart, who founded the firm with his cousin Iain Niblock.
The firm had focused on areas such as providing research on the P2P lending sector, supporting retail investors in their due diligence of the market, and in March this year took the “natural step” of launching its Orca Investment Platform.
The aggregator enables users to invest across multiple P2P platforms, lending sectors and a large number of borrowers, and came about after the co-founders spotted an opportunity to build a balanced portfolio.
The fintech – financial technology firm – integrates with five major P2P lending platforms – namely Lending Works, Landbay, Assetz Capital, Octopus Choice as well as Edinburgh’s LendingCrowd, with a further 11 to come on board in the next year.
Stodart said the key aims of the crowdfunding bid include growing its number of lenders, extending outside the P2P sector, and expanding its customer base. It comes after the firm in 2016 raised £280,000 in seed funding.
The Seedrs venture will also help Orca provide investors with more control over their portfolio and potentially see the firm expand into European geographies such as Estonia, Latvia, Germany and France. “We expect to hit our [crowdfunding] target very quickly,” said Stodart, noting that likely investors include its 2,000-plus subscriber base.
Orca said more than £12 billion was cumulatively lent across P2P platforms since the asset class was created in 2005, a third of which was last year.
One of the biggest players is Funding Circle, which recently announced plans to raise £300 million via a stock market flotation.
Orca also said there are now more than 30 P2P lending platforms in the UK, “all vying for the attention of retail investors, with specific, often niche investment products”.
Stodart expects to see a rise in the next couple of years in aggregation products such as Orca, which he said are valuable both to existing investors in the asset class, helping streamline their portfolios, and also for mainstream investors who are familiar with P2P lending but lack, say the time, knowledge and confidence to invest.
The P2P sector is under scrutiny by the likes of the Financial Conduct Authority over its risk. Stodart said Orca sees investors diversify their risk invest across multiple P2P platforms. “We believe we’re just at the next chapter of P2P lending,” he said.