ARCHOVER has secured a £3m financing arrangement with Prospect Business Centres (PBC), a serviced office space provider for UK and international corporates.
The peer-to-peer business platform has already raised £692,000 from investors and is currently funding an additional £400,000 as part of a series of loans that will channel £3.1m to the borrower over the next six months.
The funding stream is based on ArchOver’s “secured and assigned” model, which the platform launched in January to target larger business borrowers.
Compared with the “secured and insured” product, where loans to small and medium-sized firms are backed by their account receivables, the ‘assigned’ model secures loans against the borrower’s future contracted revenue.
PBC will use the new P2P loans, secured against contracted revenues of £12.3m, to repay existing credit facilities and open three new London sites over the next 18 months.
It currently services five centres in the capital and two centres in Leeds, with an average 87 per cent occupancy rate in the former. Its largest clients include GE Capital, AXA, NHS, Accenture and Keir Construction.
ArchOver said the firm is the perfect example of how a profitable business can benefit from shifting from traditional finance to the P2P model to fund growth projects quickly.
“We aim to help British businesses and have worked hard to raise awareness about alternatives to traditional lending which also maximise returns for investors,” said the platform’s chief executive Angus Dent.
“Originally founded in Leeds in 1980, PBCs has continued to expand as demand for serviced office space has grown, and it is an excellent example of how we are supporting the growth of companies that have long been ahead of their time.”
PBC’s managing director Charlie Cudworth said alternative finance is now emerging as a more mainstream option for borrowers.
“Just a few years ago, alternative finance providers weren’t as available in the mainstream,” said Cudworth. “Without the likes of ArchOver, the best options available came with high interest rates and requirements for personal guarantees.”
“When we started to consider the next stage of financing to help us achieve our projected growth figures, we were introduced to ArchOver by CreditSquare.
“It was their commitment to working closely with our business to understand our requirements coupled with its ability to package a series of loans together made it an ideal choice.”