Everyone’s happy to lend money to them, and if they’re in the fortunate position of wanting to invest what they’ve already got, there are new lenders who’d like to bring them on board as investors.
Two of the smaller new peer-to-peer funders independently asked us last year whether we could help bring them to the attention of wealthy new contacts. Ambition can quickly suck dry a flow of money and it’s easier to get excited about the potential in online funding platforms than it is to raise inexhaustible capital. So the new wave of online lenders, in particular, will sometimes answer our questions about funding lines with a question of their own: “You’re at the coal face – what’s your advice?”
It’s widely accepted that the mighty high street gastropod banks have pulled in their horns somewhat since 2008 and are rejecting the highest-risk categories of borrower, which means absolutely everybody wants to shake your hand if you don’t need anything from them (this applies as much on the commercial lending market). Even challenger banks go out of their way; one I just looked at has an “offering [which] is designed for those earning £300k+ per annum and with net assets in excess of £3m.” This is for individuals, but quite often these individuals are setting up companies and seeking commercial loans. They compete for these loans against small business owners at the other end of the scale who are, to take some real examples, sleeping in sheds and living on bread and tuna for 50p a day – sacrifices sometimes worn as badges of honour, but born from the belief that they couldn’t get funding from any commercial lender.
We know there is more than one lender, names such as Funding 365, who will take a watch, fine wine or a “Birdcage” Maserati as security, as they all fulfil the three vital criteria of being easy to value, easy to move and easy to sell – relative, especially, to intellectual property or a salmon farm. While the high street banks might throw open their doors very wide to the high net worth client, there are some imaginative alternatives out there doing things in a way that is quicker and simpler for the borrower.
Faced with the luxury of choice, our hypothetical Leica collector might simply find one lender “feels” right, because even when everyone offers similar products, this is still an industry of nuances and handshakes.
