Crowdlending portfolio updates – February 2020

I love writing here, and it also helps me understand my investing decisions. I’ll compensate for the lack of activity by spending a bit more time now and analyze my crowdlending portfolio.

I’ve neglected my blog in the past few months and I feel a bit guilty for doing so. My new job ate almost all my available time, and so far, it’s been fun, so I can’t complain. Working in a rapidly growing company is interesting, and it gives me the opportunity to wear different hats and shape processes, help others grow, get actively involved in sales, and much more. Most importantly, it gives me the opportunity to make mistakes, from which (hopefully) I’ll learn some lessons.

I love writing here, and it also helps me understand my investing decisions. I’ll compensate for the lack of activity by spending a bit more time now and analyze my crowdlending portfolio.

The current state of my crowdlending portfolio

  • 600 EUR new deposits to Neo Finance, Trine and Lendahand
  • Swapped 1000 EUR from Fast Invest to Mintos
  • Swapped 400 EUR from TFG Crowd to EstateGuru
  • 255 EUR in earnings
  • 25500 EUR portfolio size

Even if my current Neo Finance returns are under 2% (caused by the provision fund fees), the platform is one of the safest in my portfolio, along with Mintos and EstateGuru. I’m willing to give my Neo Finance portfolio more time to grow.

Nothing new happens with Fast Invest regarding transparency, so I’ve continued to lower my investments here, and moved part of the funds to Mintos. The returns are similar, and transparency much better.

Given the current p2p lending market craze, I’ve caved in a bit and instead of investing 400 EUR in a few real-estate investments from TFG Crowd, with 17% interest, I’ve decided to move the free funds to EstateGuru and invest them in similar property-based loans with only 11% interest. It doesn’t hurt to be a bit more defensive with my portfolio and lower a bit my exposure to high-risk investments.

Platform Value (EUR) Profit Annual return
Mintos 3794 (+1081) 700 (+31) 12.56%
Fast Invest 2722 (-1017) 762 (+33) 13.96%
EstateGuru 2659 (+423) 228 (+23) 10.52%
Grupeer 2118 (+23) 238 (+23) 13.54%
TFG Crowd 1713 (-421) 184 (+24) 19.27%
Monethera 1606 (+25) 106 (+25) 17.69%
Viventor 1564 (+22) 161 (+21) 13.52%
Wisefund 1611 (+22) 111 (+22) 22.7%
Neo Finance 1392 (+409) 22 (+9) 1.97%
Crowdestor 1085 (+10) 119 (+10) 15.28%
Crowdestate 1058 (+5) 104 (+5) 9.73%
Flender 915 (+78) 38 (+5) 8.34%
PeerBerry 609 (-27) 191 (+6) 12.36%
Debitum Network 527 (+4) 27 (+4) 10.03%
Investly 618 (+104) 18 (+4) 10.66%
Bondster 418 (+5) 18 (+5) 12.4%
Bulkestate 302 (-101) 15 (+2) 8%
Impact Investments Fund 906 (+200) 34 (+3) ??
Exited 0 -1224
Total 25517(+844) 1852(+255) 8.77%

Mintos

New loan originators joined Mintos in February: Julo, DanaRupiah and Pinjam Yuk from Indonesia, GFM from Kazakhstan, and a few others. The links point to their company presentation and financials, and they’re interesting to read if you decide to invest in loans from them. Even with the high-interest rates they charge borrowers, they still only manage to get around 20% in profits.

I won’t invest in them, especially since all 4 are rated B-. After Rapido Finance downgraded from B- to D (default) in just a few weeks, I made it a rule of thumb just to stay away from lower-rated originators.

I’ve installed the newly created Mintos mobile app, and all I can say is that I find no use for it. It’s new, shiny, and useless. Besides checking my balance and see if my auto-invest worked or not, there’s nothing I can do in the app yet. And I already get that data from a daily mail from Mintos.

One cool thing Mintos decided to share this month was that they organized a technical meetup, called TechStash. Tech meetups are usually soft ways to promote your company at the local community level. You attract new talent from outside your company, talk about some cool stuff you’ve built, make them feel better with beer, pizza, and (hopefully) next time your recruiter calls them they’ll remember the meetup and think you’re a cool company and agree to meet for an interview. Besides the self-promotion aspect, I like that Mintos sees itself as a tech company and sees innovation as a priority.


Fast Invest

Each month I look at Fast Invest’s blog for something interesting to read, and each month I get more disappointed. This month’s about plagiarized articles.

While Mintos is a fine example of how to run a company blog and how to be transparent on what happens at the company level, Fast Invest is at the opposite side.

Instead of writing about things that happen inside Fast Invest, things I’d be interested in reading, the run a pseudo fintech news section, posting half-baked articles about innovation and fintech industry updates. Fast Invest, nobody reads that!

There are a few reasons why I wouldn’t get my fintech news from Fast Invest:

  • The articles are just not enough and present a very incomplete picture
  • There are many available sources offering a lot better content
  • The Fast Invest content is not even original

For example, their latest article, FinTech Innovation: China Lab, is a rephrased copy from Fintech Takes, written by some Alex Johnson a month before. What’s even worse, the copied Fast Invest article is worse than the original and harder to follow. Fast Invest, why would you even bother posting that? You could just make an RSS feed news section, with interesting things to read on fintech, and that would be a million times more useful.

I see Fast Invest currently has 6 open positions on LinkedIn, and I think a good idea for them would be to also open a position for a marketing person.


EstateGuru

EstateGuru is another very good example of how to run a company blog. Their articles are genuine, address their real problems, and in all of them, they emphasize they want to be transparent. I always love reading their articles.

A very good article was published at the beginning of February, talking about EstateGuru’s defaulted loans. It’s a sensitive topic, and I like that they’re open about it. The optimist takeaway from the article is that even though their outstanding loan portfolio has a 6.9% default rate, the average time for loan recovery is only 5 months and investors return on defaulted loans are still 10.9%. The pessimist takeaway is that the current default rate is high, at 6.9%. Read the article and decide for yourself.

Another big news from EstateGuru is that they decided to add dedicated virtual IBANs for each investors account, using Lemon Way wallets, their payment provider. The below picture shows the flow of money between borrowers and investors, and how EstateGuru’s company account won’t be involved in the transactions anymore.

estateguru and lemonway investor accounts money flow

Another interesting news from EstateGuru is the introduction of their referral rewards. For each friend you invite on the platform, you get different rewards. You get investment credits, hoodies or get invited to the EstateGuru Premium club, which I didn’t even know it existed. The only thing that bothers me is one reward named “Unlock advanced Auto Invest settings at €50”. I’m a bit disappointed that something that should be a default feature is only offered to a select group of investors.


Grupeer

Grupeer continues their aggressive marketing campaign, offering incentives for new investors and cashback for loans from most of their loan originators. It would be interesting to see Grupeer’s financials, and whether they managed to make a profit yet, given how much they spend on attracting new investors.

An interesting bit of news is that Grupeer will finally add 2-factor authentication to their site in a few weeks. It’s an easy to add and very important step in securing investors accounts, and I don’t see why any platform handling investor money doesn’t have that.


TFG Crowd

24 EUR in income this month and an annual return of 19.17%, not bad for TFG Crowd. However, I still withdrew 450 EUR from here and moved the funds to EstateGuru, so I lower a bit my portfolio risk. The risk of investing in smaller p2p lending platforms is currently heightened by the recent panic caused by Envestio/Kuetzal, so I try to limit my exposure to panic risk.

The biggest news from TFG Crowd is they made public their platform roadmap, and where they want to be in the next 3 years.

tfg crowd roadmap 2020

Their plans include obtaining an FCA authorization, IBAN accounts for investors and Visa cards, business accounts and more. I’m not sure if it’s just wishful thinking, but I’m looking forward to that Visa card. It’s supposed to be available by the end of 2020, not too far away. Mintos also promised a card a long time ago and put that promise into practice seems to be more complicated than expected.


Monethera

I’ve earned 25 EUR this month from my Monethera investments, making my annual return here 17.69%. While returns are good, Monethera news is so-so.

Monethera decided to postpone indefinitely the reactivation of their early buyback. Given the current market panic, it was the sensible thing to do, since it affects their platform stability. I understand their point of view, but it’s also interesting to see the level of power a platform has over the features and promises it makes. The early buyback was one feature that attracted many investors and one of its effects was that in case things go south, investors can get out quick.

The panic level is still at high levels in the p2p lending community, and this can also be seen in Monethera’s numbers. Since 2020 started, only 300 new investors joined the platform, and loans worth only 700.000 EUR were funded. I assume most of these come from the beginning of January before the big Baltics scare began. It’s not easy to be a high-risk crowdlending platform in the Baltics right now, and it’s interesting to watch how Monethera is handling the situation.

To make matters even worse for Monethera, their Paysera account (where they keep investors funds) was closed and they’re looking now for a new provider. This means for a short time no investor will be able to withdraw their funds, adding to the existing panic.

Given the current state, their launching of the auto-invest feature went mostly unnoticed, or it was met with acid comments like “an auto-withdraw would be more popular”. I did have a look at it, and one thing that I don’t like about it is that I can’t set a maximum EUR amount to invest in a single loan, but instead, I have to select a percentage amount of my balance. I have no direct control over how much I invest in a single loan through auto-invest.

One very good thing that happened on Monethera this month was that the available projects have all the documents needed to actually understand what you’re investing in.

For example on the Old Apartment Renovation project:

I really like this, and I hope Monethera continues to do so on every new project. I’ve reinvested all my available funds into the apartment renovation project so far this month.


Wisefund

Wisefund also seems to suffer from a slowdown in the number of new investors. Their early buyback reinstatement is also postponed until further notice. As with Monethera, just waiting for the storm to pass doesn’t seem to have the expected effects, so Wisefund team needs to step up their game.

I have 22 EUR available in my account, but the only available project right now is for an Estonian company that wants to buy overpriced face masks from China and sell them at an even higher price to panicked Europeans. If coronavirus proves seasonal and by the end of March it stops, they’ll just sit with their overpriced stock and bankrupt, because nobody would buy their supply anymore. I can’t really invest in that, so I’ll wait for the next project.


Viventor

I’ve earned 21 EUR from my Viventor account in February, raising my annual return here to 13.52%. Not bad for an ugly p2p platform I didn’t put much hope into. I still have 150 EUR tied up in Aforti Finance loans, which didn’t pay interest since October 2019, so there are still issues with Viventor.

If there’s one good thing that came out of the January p2p lending debacle, was that more and more platforms feel compelled to talk about their operations and be more transparent with their investors. Viventor issued a statement talking about their business model, shareholders, investors return and current loan book.


Neo Finance

I’ve finally had time to read Neo Finance’s report and financial statements for 2019. Everything seems to be growing: income by 70%, investor registrations by 157%, losses by 60%. It’s no wonder that 6 months later their stock still sits at last year’s IPO levels. While they do grow, they’re still far from being a profitable company.

I’ve added 400 EUR to my account and let the auto-invest tool do its thing. It took around a week for the funds to be invested, since I’m only investing in A-rated loans with 11%+ interest rates and some additional criteria. Overall, I’m happy with the process.

My annual return increased a bit from 1.77% to 1.97% this month, and I’m expecting it to slowly increase in the following months since I’m not investing with the provision fund anymore. The returns are not stellar yet, but I still have high hopes for Neo Finance.


Crowdestor

I wanted to withdraw around 30 EUR free funds from my Crowdestor account and realized I need to redo my identity verification in order to withdraw my funds. Being a good procrastinator, I’ve decided to postpone withdrawing them until I have enough time, energy, to reupload my documents, smile to the camera and whatever process Crowdestor has.

Crowdestor can still brag about zero defaults, although they’ve been on the market for less than 2 years. Their buyback fund in case of defaults reached 300.000 EUR in February. In light of recent events in the Baltics market, Crowdestor’s buyback fund doesn’t seem too reassuring, without a comprehensive description of their debt recovery process. In a way, I’m waiting for the first default to happen, so I see how things actually happen, and how investors react when they receive only 2% of their invested amount from the buyback fund.


Crowdestate

Crowdestate expanded its loan portfolio to the Czech Republic in February, adding the 5th market to the current ones from Estonia, Latvia, Italy and Romania. Some interesting projects could come from here.

This is where the good news ends for my Crowdestate portfolio. My annual return is just 9.73%, on a platform boasting on their home page 17% returns. 4 of my investments are late with their payments (1 of them in default). Recovery is very slow and gets delayed every month. Secondary market transactions on troubled projects don’t get suspended as soon as Crowdestate knows about the problems, and some investors with insider knowledge do profit from this and sell their investments on the secondary market at small discounts.

Even though I like Crowdestate, their debt recovery procedures and shady secondary market practices don’t really make me invest more with the platform. That wouldn’t stop me, though, to invest in the next real-estate project coming from Romania.


Flender

My Flender portfolio is slowly reaching 1000 EUR. Each month I add just enough that my free funds can get invested in new loans, which usually sums up to less than 100 EUR per month. For the past few months, I’ve only relied on the auto-invest feature, as the loans get funded so fast, they don’t even reach the marketplace to manually invest in them.

My annual return is decent enough for me to continue investing here, at 8.34%.


Peerberry

Peerberry also decided to be more transparent regarding their operations. Starting January, they started publishing articles on their partners’ business models, plans and some financials:

While my returns are decent, at 12.34%, I’m still slowly withdrawing from PeerBerry, due to their main focus on payday loans.


Debitum Network

Debitum Network added an interesting feature in February, called “loyalty services”. You get rewarded DEB tokens (some internal currency based on Ethereum blockchain) based on how much you’ve invested on the platform. For less than 500 EUR invested, you receive zero DEB. For more than 5000 EUR invested, you receive 180 DEB each day. You can’t withdraw them or sell them, but you can use them to by these “loyalty services”, which for now are just 2: liquidate an investment early and follow an investor.

The “follow an investor” feature seems like an interesting one, mimicking social investing platforms, where you can copy somebody you like, and they receive rewards. On Debitum, however, the investor you copy doesn’t receive any rewards. For the current number of existing investments, this feature doesn’t make too much sense, but it could be an interesting one in the future.

I receive 20 DEB each day into my account, and I tried to see what I can buy with my tokens: absolutely nothing. To liquidate an investment, I need 12.500 DEB tokens. I would need 2 years in order to have enough tokens before I can sell early just one investment from my portfolio. Even with a maximum of 180 DEB tokens per day, I would still need more than 2 months before I had enough for the early selloff. To follow another investor, I need 2500 DEB tokens per week. That means no investor can use their rewards in order to finance this “follow an investor” service, as with 180 DEB tokens per day, at the end of the week you’d only have half of the funds needed.

But, if you already have DEB tokens in an outside wallet, you can transfer them to your Debitum account and use them. Very convenient. 1 DEB token is worth right now 0.0385 USD. Buying 2500 DEB tokens, to finance the “follow an investor” feature would cost me 100 USD per week, or 400 USD per month. Financing the “liquidate an investment” feature would cost me 500 USD. In no possible universe I’d be willing to pay for any of these 2 services this amount of money.

I can understand that these “loyalty services” are Debitum’s way to compensate early investors in their ICO from 2 years ago when Debitum raised 17 million USD and investors gained nothing. But the current program’s mathematics don’t work for anybody, except for early investors in the DEB token that had (and still have) no better use for their money.


Investly

It’s hard to get excited by a platform that doesn’t offer big returns, I’m not invested too much in it and the only thing that offers me is a different risk profile. However, I find entertaining watching my Investly portfolio.

Out of the 30 invoices I’m invested in:

  • 25 are in current status, amounting to 575 EUR
  • 1 is late by up to 15 days, owing 10 EUR in principal, 0.27 EUR in interest and 0.01 EUR in penalty payments
  • 2 are late by more than 15 days, owing just 0.08 EUR in penalty payments
  • 1 is late by more than 30 days, owing 24 EUR in principal and 1.16 EUR in interest and penalty payments
  • 1 is late by more than 60 days, owing just 0.05 EUR in penalty payments

The amounts owed don’t amount to much, but I like the current numbers and ratios between current and late invoices. Even with the slightly lower returns, I’m willing to invest a bit more on the platform.


Bondster

I don’t feel any love for Bondster. The returns are good, the platform looks decent and it’s growing at a steady pace. In 2019, they more than doubled their investment volume. However, it doesn’t bring my portfolio any additional diversification, so I’ve decided to pull out of the platform in the next few months.

It’s been fun for a while to track my portfolio on 20+ platforms, but I think it’s time to leave testing platforms behind and move to different interests.


Bulkestate

After waiting for more than a month to get 100 EUR invested into a new property, I’ve decided to withdraw the free funds and invest them somewhere else (Investly). I’ll also move out of Bulkestate when my investments mature, even though Bulkestate is still an interesting platform. The low number of investments due to Bulkestate’s focus mainly on properties in Riga make it a tough platform to follow and invest in. This month though they also added their first property from Finland, so I believe I was not the only investor losing interest in Bulkestate because of their lack of diversity.


My impact investments fund

I’ve received my first 3 EUR in interest from Trine in February. I’ve also added 100 EUR in a new solar project from Trine and another 100 EUR in 2 Lendahand projects.

The Lendahand investment dashboard is really interesting. Besides the typical financials, I also get an interesting view of the impact of my investments:

lendahand dashboard

Trine has a similar dashboard, focusing on its sustainable development goals:

trine dashboard

I don’t know how these metrics are built, and I’m sure all of them measure the maximum potential positive impact, and the numbers are shown just to make investors feel better about themselves and invest more funds. However, they do make me feel somewhat good about myself, so I’ll keep diverting a small part of my funds each month to these types of investments.

I’ve also invested last month in a Seedrs crowdfunding campaign from Gone West, a UK company that replants trees on commercial forestry plots and has some small partnerships in Romania too.


Retired platforms

I’ve added a new page where I keep track of crowdlending platforms I’ve retired from. I’ve included here past experiments, along with the biggest fails so far, Kuetzal and Envestio. For optimists like me, it’s easy to forget bad events, so I need to keep them as a separate row in my portfolio tracker, so I don’t forget about them.


Other investments

My vacation fund

The vacation fund I keep on Iban Wallet reached 1000 EUR last month. It’s a good round sum to spend during the summer, so I think I’ll stop adding funds in the next few months. I’ve earned so far around 8 EUR in interest and 10 EUR in registration bonus. For another month or so I’ll get paid 3.5% interest rate, and then the interest will go back to 2.5%.

There are many other things I could do with these funds instead of keeping them in a 2.5% interest account, but it’s an interesting experiment for me. I’ve never put money aside in a special vacation fund. In most of the vacations I’ve been I’ve spent less than my monthly paycheck, so I never had to save in advance. The only time I needed more money than I earned was during my 6-month vacation last year, and then I just liquidated some of my low-return investments in order to finance my expenses. I want to see what happens if I put money aside ahead of time and then just forget about them. And Iban Wallet is not the worst place where I could keep my funds.


Corporate bonds

I’ve added around 1000 EUR to my WiseAlpha account in the past 2 months:

  • my GBP account reached 2700 GBP
  • my EUR account reached 850 EUR

I like that in the past few months WiseAlpha increased the offer on EUR bonds, adding more companies to their marketplace.

My current annual return is at 14.7% on my GBP account and 23.9% on my EUR account. Although I’m playing a bit with fire, selling bonds every time they receive good news and their prices grows and buying higher-risk ones when the bad news hit the market. On the other side, prices for corporate bonds sometimes look a bit too volatile for bonds. For example, in the span of less than 1 year, I’ve bought Travelex 8% bonds at 92 EUR in February last year and sold them in July at 102 EUR. Then bought them again this February at 97 EUR, as their bond prices dropped after their site was offline for almost a month due to a cyber-attack.


Equity crowdfunding

My plan for 2020 was to invest around 2000 EUR more in startup companies. At the end of February, this was the actual status:

  • I’ve already managed to use up half of my budget, investing in craft beer, payment providers and green energy companies.
  • Most of the funds went to Seedrs, with a smaller part to Crowdcube and Funderbeam
  • I didn’t have enough funds to invest in my stock portfolio, which in light of recent events, might have been a good thing

Stocks

The stock market had a few weird days last week due to coronavirus panic, so being a complete idiot, I’ve managed to do 3 things:

  • All my 2019 gains were wiped out
  • Seeing stocks are on discount, I bought more
  • Now I have 6000 EUR in debt on Degiro, which I’ll need to pay in the following months

How’s your portfolio doing? Better? Worse? Drop me a message