Rhydian Lewis, founder and CEO of RateSetter
Peer-to-peer lending platform RateSetter has been valued at £200m after its latest funding round saw the company raise £13m.
RateSetter has raised £13m in equity capital from a combination of the company’s existing shareholders and well-known fund managers Woodford Investment Management and Artemis.
The London-based peer-to-peer lender will use the investment to scale up the business ahead of the anticipated launch of its Innovative Finance ISA.
The fundraising takes the total amount of capital raised by RateSetter since its launch in 2010 to over £40m and values the business at over £200m.
The business has always raised ordinary equity, choosing not to use the preference share structures typically favoured by venture capital-backed firms.
The announcement follows the recent announcement that Paul Manduca, the chairman of FTSE 100 global insurer Prudential, will become RateSetter’s chairman in July 2017.
Mandunca’s distinguished career in asset management saw him found Threadneedle Asset Management and serve as CEO at both Rothschild Asset Management and Deutsche Asset Management.
As a non-executive, Manduca has held senior positions in both financial services and other sectors, including at Wm Morrison. He also chairs the advisory council of TheCityUK.
Rhydian Lewis, founder and CEO of RateSetter, said: “RateSetter is giving ordinary investors the opportunity to access better returns and borrowers the opportunity to look beyond their bank.”
Before launching RateSetter, Lewis spent six years at Lazard where he saw an opportunity to narrow the spread between what investors earn and what creditworthy borrowers pay, and allow everyday investors to access the risk and reward of lending. He is also passionate about markets and hopes that the rates set by investors on RateSetter will one day come to be seen as reference rates.
He said: “The most satisfying part of the growth is seeing everyday investors and borrowers adopting our product: I see them benefitting and it makes me enormously proud that we have managed to build something useful to people.
“It is important to keep up the momentum of investing in our platform and this further injection of capital, coupled with the appointment of Paul Manduca as chairman, lays the ground for an important new phase of development for our business.
“I am delighted that a figure with Paul’s stature has agreed to become chairman of RateSetter at this important new phase in our development.
“Paul’s experience in asset management, his reputation as a business builder and his authority in good governance can help us enormously in our aspiration to make RateSetter a benchmark brand in lending and borrowing.
“There has never been more confidence in RateSetter’s future – we have already delivered more than £70m in interest to our lenders and, as we continue to scale up, we look forward to delivering even more impressive results.”
RateSetter has grown significantly since its launch in 2010. On the borrowing side, it has diversified across multiple channels and across both consumer and business loans, and is investing to build up its capability to originate loans at scale across these channels.
On the investing side, RateSetter pioneered many firsts in the sector, including the Provision Fund model which has made it popular with retail investors.
RateSetter currently has over 300,000 active investors and borrowers on its platform, making it one of the largest FinTech businesses in the UK.