Investment in crowd-funding platform

RNS Number : 9342M

GLI Finance Limited

02 September 2013

 



GLI Finance Limited announces investment in
invoice finance crowd-funding platform, Platform Black

London, 2^nd September 2013 -- GLI Finance Limited ("GLIF" or the "Company"), a specialist lender to small and medium sized businesses, today announces that it has invested £2m in the crowd-funding platform, Platform Black Limited ("Platform Black"). The investment is in the form of equity and preference shares, in return for which GLIF will own at least a 20% stake in the business. Geoff Miller, CEO of GLIF, has also joined the Platform Black Board.

Platform Black is the fastest growing online platform for crowd-funding invoice finance.  The platform enables SMEs to get access to the money tied up in their invoices by auctioning them online to investors seeking attractive short-term returns.

Platform Black delivers cashflow on demand on a pay as you go basis.  SMEs auction their invoices, remaining in control of all of the costs, to investors who compete to deliver the lowest cost of finance.  Platform Black has advanced c. £21m to SMEs to date, and delivered net annualised returns of 12-15% to investors.  Platform Black's service is entirely complementary with that of the banks and asset based lenders.

Geoff Miller, CEO of GLI Finance, said: "This investment is a perfect fit within our strategy of focusing on niche lending to SMEs and enables us to add short-term asset-based debt to our portfolio, while continuing to reinforce the geographical diversification of our business. We are delighted that Colin Levins, Louise Beaumont and their team have chosen to partner with us, and GLIF looks forward to building on this investment by trading on the platform, as well as investing in the business."

Colin Levins and Louise Beaumont, co-founders of Platform Black, commented: "We are excited to have GLI Finance as a significant investor and partner in our business.  In 2012, in the UK alone, the invoice finance market was worth £254bn. This, together with a gap in SME funding estimated to be between £84bn and £191bn by 2018, means that there is significant and growing demand for our services. There are excellent synergies between GLIF's other platforms and our business and we look forward to working with Geoff and his wider team."

- Ends -

Notes to Editors

For further information, please contact:

Rhizome PR                                                                 FTI Consulting

Jonny Stevens                                                              Ed Gascoigne Pees

Jack Izzard                                                                   + 44 207 269 7132

+ 44 207 297 3163                                        

Platform Black Limited                                               GLI Finance Limited

Louise Beaumont                                                        Geoffrey Miller          

+ 44 8434 610200                                                      + 1 203 916 0003

+ 44 7906 245545                                                      + 44 7408 830719

Investec Bank PLC                                                      Panmure Gordon

Tim Mitchell                                                                  Dominic Morley

Jeremy Ellis                                                                  Fred Walsh

+ 44 20 7597 5970                                                     + 44 20 7886 2500

About GLI Finance 

GLIF is a specialist lender to small and medium sized enterprises and is quoted on AIM and the CISX.  GLIF both invests in loans to SMEs and originates loans to SMEs. SME loan investment is currently primarily in US senior secured loans of mid-market size mainly via CLO equity holdings. SME loan origination, primarily in the UK, and was established through the acquisition of BMS Finance in November 2012, and investment in FundingKnight in July 2013.

The strategy for GLI Finance, remains as it has been for the past three years:

§  Focus on secured lending to small and medium sized enterprises

§  Diversify that lending across geographies and types of business

§  Drive down cost/income ratio

§  Optimise capital structure

About Platform Black 

Platform Black is an online platform for crowd-funding invoice finance that enables SMEs to get access to the money tied up in their invoices by auctioning them online to investors seeking attractive short-term returns.

Platform Black has advanced c. £21m to date. Those buying the invoices - banks, asset based lenders, funds, family offices and high net worth individuals - advance the money in return for a fee. Platform Black's reverse auction model allows regular traders to drive down the fee they pay - some companies have secured the finance they need for as little as 0.5% per 30-day period.

In its first month of operation in June 2012, Platform Black advanced just £65,000. In June 2013, businesses used it to access over £3.2 million. And this has increased to £4m+ in August 2013.

Over 550 auctions have been run - all of them successfully. The invoices auctioned have ranged in size from £5,000 to £500,000. The average auction size is £40,000.

Among the c. 450 registered members, businesses selling their invoices come from all sectors, though the construction sector (21%) and manufacturers (20.8%) are particularly well represented. About half (52%) of the investors are high net worth individuals.

The default rate is less than 0.18%, and investors have made net annualised returns of
12-15%.

Platform Black is a member of the Asset Based Finance Association (ABFA) and the National Association of Commercial Finance Brokers (NACFB).

 

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