Maven funds expansion of peer-to-peer lending firm

● Private equity house to invest £2m in P2P lender ● Forecasts predict global P2P market will reach £110bn

Glasgow-headquartered private equity house Maven Capital Partners has spearheaded a £2.8 million investment in a peer-to-peer lending platform.

Maven, which describes itself as one of the most active firms of its kind in UK, led from the front by completing a £2m investment in London-based Lending Works.

The peer-to-peer (P2P) lending platform also received a combined total of £800,000 in funding from NVM Private Equity, Pollen Street Capital, and a small number of business angels.

Lending Works said it will use the funds to strengthen its operational team and sales and marketing functions, with a view to expanding the business further and capitalising on the “significant growth” forecast in the P2P market.

P2P and crowdfunding platforms are an increasingly common presence in the alternative finance market. Their popularity started to grow following the economic crisis, as they facilitate borrowing and lending without using an official financial institution as an intermediary.

Globally, the market is growing rapidly, and a 2016 report from PWC estimated the P2P sector could be worth as much as £110 billion by the year 2025.

Nicholas Harding, CEO at Lending Works, said: “We are very pleased to have secured this investment from Maven, NVM and Pollen Capital.

“We have very ambitious plans to both dramatically improve the consumer credit market for customers and build a business that funds billions of pounds of loans per year. This investment will enable us to continue on that journey.

“The team at Maven immediately understood our business model and is hugely supportive of our growth strategy. We look forward to working with them to take the business from strength to strength.”

Founded in 2014, Lending Works was the first major P2P platform to receive full authorisation from the Financial Conduct Authority.

After rapid growth in recent years, its lending total has now reached £115m, 27 per cent of which (£32m) was distributed to customers in the first half of this year.

Melanie Goward, investment director at Maven, said: “We are delighted to lead the investment in Lending Works, which has grown to become one of the leading P2P lenders in the UK.

“The firm has developed a reputation in the market of being a responsible and ethical P2P market leader, which is evidenced by it being the first major platform to have been fully authorised by the FCA and the first to have negotiated insurance cover which provides lenders with protection against borrower defaults.”

Since 2009, Maven has invested more than £347m in small and medium-sized enterprises across the UK.