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Funding Circle’s Record-Breaking Move


Alternative lending firm Funding Circle has successfully debuted its first fund structure on the London Stock Exchange and has raised a pretty penny for it, too. Wednesday (Nov. 25) reports said Funding Circle’s SME Income Fund raised more than $227 million through its initial public offering, just weeks after the lender confirmed earlier reports that it planned to float the fund.

[bctt tweet=”Funding Circle’s SME Income Fund raised more than $227 million through its initial public offering.”]

Reports said the majority of the fund’s investors are institutional and incorporate loans in the U.K., U.S. and Europe.

“We are delighted with the very positive response to the issue,” said Funding Circle SME Income Fund Limited Chairman Richard Boléat following the IPO. “The success of the issue is a strong endorsement of Funding Circle’s marketplaces and their focus on small business lending in the U.K. and U.S.”

Fellow alternative lending platform LendInvest is reportedly planning to follow Funding Circle’s lead and debut its own fund on the stock exchange in the near future, a move that some reports said could signal a new trend among small business investors.

The successful float of the fund marks the first time an alternative lender has made such a move, according to reports released in July, when rumors of the IPO first surfaced.

Already, rumors of Funding Circle’s next move have surfaced. Reports said the company is in talks with the European Investment Bank to secure a financing facility.

Earlier this year Funding Circle switched up its entire business model when it decided to no longer put small business loans up for auction for potential investors on its site. Instead, the company ditched the auction model and introduced fixed interest rates for SME borrowers using the platform.


New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.