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Squirrel investors get offer docs today

Squirrel’s founder has revealed an ambitious plan for growth ahead of a share market listing within the next 18 months.

Friday, March 4th 2016, 6:00AM

by Susan Edmunds

Interested investors will today be sent an offer document for the company’s equity crowdfunding round via the Snowball Effect platform.

The company wants to raise $2 million via crowdfunding.

Squirrel founder John Bolton said it would then look for another $3 million in institutional funding before planning a NZX listing within 18 months.

Squirrel operates peer-to-peer lender Squirrel Money and Squirrel Mortgages.

The money raised from the crowd will cover restructuring and offer costs, the development of a new online mortgage application process, a Squirrel Money app, and seeding the Squirrel Money reserve fund, which protects investors from defaults.

Squirrel also plans to put $2 million into its Squirrel Money underwriting facility to enable it to process loans more quickly.

Bolton said: “That allows us to settle loans immediately with borrowers before passing them back to investors. We think that’s really important to grow that business a lot faster.

The business has a pre-offer value of $23 million. Squirrel wrote $800 million in mortgages in the last year and is on track for $1 billion this year.

The mortgage business represents the bulk of the value of the group, at $20 million. It has a $1.6 million operating profit before tax.

Bolton said the re-emergence of trail commission from the banks meant 50% of Squirrel’s deals now came with ongoing income attached. That would build to $1.5 million over three years, he said.

The peer-to-peer business is still in the initial launch phase and has written $1.7 million in lending so far but has a $15 billion market opportunity ahead of it, Bolton said. It is not expected to break even for another couple of years.

But Bolton said the $3 million valuation was conservative. “We’ve been on a strong trajectory and we fully expect that growth to continue.”

Bolton said the crowdfunding offer was only being made to people who were already connected with Squirrel, such as existing clients. “It’s exciting for us to have our clients involved and engaged in the business, becoming investors. It feels good to know we can share our success with our clients.”

Tags: Peer to Peer Lending Squirrel

« Peer-to-peer a growing option, broker says$4m may be coming from Squirrel investors »

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Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.14 6.75 6.39
ANZ 8.64 7.74 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.14 6.79 6.65
ASB Bank 8.64 7.14 6.75 6.39
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - 7.14 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 7.74 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 6.79 - -
Co-operative Bank - Owner Occ 8.40 6.99 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.49 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.89 6.55 6.35
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.69 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.74 7.35 6.99
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 7.99 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 6.99 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.65 7.25 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 8.09 7.59 7.29
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.09 8.59 8.29
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.74 ▼7.09 ▲6.95
SBS Bank Special - 7.14 ▼6.49 ▲6.35
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.14 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 7.79 7.55 7.45
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 6.99 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - 6.55 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Westpac 8.64 7.84 7.35 6.99
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.24 6.75 6.39
Median 8.64 7.19 7.17 6.65

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