Temasek eyes £30m stake in Funding Circle

Δημοσιεύθηκε: 2 Απριλίου 2015 - 16:01

Temasek, Singapore's state investment company, is planning to buy a stake in peer-to-peer lending platform Funding Circle, in another example of how fast-growing European companies are increasingly opting to raise money privately rather than floating on the public markets.

London-based Funding Circle is planning to raise more than £50m in new capital and Temasek is intending to invest about £30m as part of the deal, which would value Funding Circle at more than $1bn, according to people familiar with the situation.

BlackRock, the world's largest asset manager, and Edinburgh-based asset manager Baillie Gifford are also in discussions to participate in the fundraising, according to a person familiar with the situation.

Temasek, Funding Circle, Baillie Gifford and BlackRock declined to comment. Temasek's planned investment was first reported by Sky News.

P2P lending platforms use online technology to connect borrowers with lenders, often providing cheaper finance than high street banks without assuming the credit risk of holding loans on their balance sheets.

European companies are increasingly raising late-stage rounds of private financing, mirroring a trend in the US where unlisted technology companies such as Dropbox and Uber have raised money privately at blockbuster valuations.

Funding Circle would become the latest $1bn European start-up, following luxury online fashion retailer Farfetch, money transfer group TransferWise and music discovery app Shazam, which have all been given $1bn valuations from private fundraising rounds.

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Traditional and alternative financing providers are starting to work together. In June Santandersigned a pact with Funding Circle and became the first high-street bank to refer its customers to an online P2P lender. At the time Santander chairman Ana Botin said that peer-to-peer financing is also a "useful way to introduce people to the concept of investing in entrepreneurs; an important element in a healthy enterprise economy."

Vince Cable, the UK business secretary, said of the partnership between Santander and Funding Circle: "I want to see others follow suit and make this standard practice for all large banks."

The UK coalition government has lent its support to alternative lending platforms by agreeing to use Funding Circle to lend £40m of the money earmarked for the new Business Bank.

Funding Circle is backed by Index Ventures, Union Square Ventures, Accel Partners and Ribbit Capital. The company's private backers include Charles Dunstone, co-founder of The Carphone Warehouse, Ed Wray, co-founder of Betfair and Jon Moulton, founder of private equity firm Better Capital.

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