Capital Match : P2P lender Capital Match raises Series B from B Capital Group

SINGAPORE (Jan 25): Debt and invoice crowdfunding platform Capital Match has raised an undisclosed sum in Series B funding. The round was led by B Capital Group, a venture capital firm backed by Facebook co-founder Eduardo Saverin. The peer-to-peer lender said the round was oversubscribed. Existing investor Dymon Asia Venture Capital Fund also joined the latest fund raising. "Capital Match is well positioned to transform lending to SMEs with its strong credit processes, operations and technology," says Kabir Narang, partner at B Capital. "SME lending is a massive market that is only starting to get impacted by technology and online lending platforms in Southeast Asia." The proceeds will help Capital Match break into the Hong Kong market and grow its financing products portfolio. Today, the four-year-old start-up runs an invoice financing and business loan crowdfunding platform that allows ordinary investors to fund businesses directly. It has funded over $66.6 million in loans and invoices. The platform has 6,000 registered users. About 600 of them are active participants. CEO Pawel Kuznicki says the projected default rate for 2017 is 0.5% - at the lower end among crowdfunders in the region. The platform hosts more than a hundred loans and invoices a month, which Kuznicki says get funded almost immediately upon being made available. Average interest return on the platform is around 20% to 22% per annum. Capital Match's plan to expand into a new market comes as the industry is drawing greater interest from institutional and professional investors. Record low interest rates and sky-high equity valuations have led investors to seek new avenues to deploy their funds. Kuznicki says his platform signed on two large institutional investors last year. The number of accredited investors on its site is also increasing. About 15% of its investors today are professionals. "[Debt crowdfunding] offers short-term liquidity and have low-correlation to other asset classes," says Crescap's investment manager Katalin Windisch. "We also believe in the growth of the [the SME market] and we would like to increase our exposure to the entire Singapore market from €2 million to €3 million within the next 12 to 24 months." Why are professional investors getting into the world of peer-to-peer investing? Are the higher returns sustainable? What are the latent risks that investors should be aware of? Find out more in the upcoming Issue 815 of The Edge Singapore, out tomorrow (Jan 26).