Simple Crowdfunding has seen more demand for its peer-to-peer offering than its equity crowdfunding arm of the business, amidst the coronavirus pandemic.
Atuksha Poonwassie (pictured), co-founder and managing director of the platform, said that investors are currently saying they would prefer to invest in P2P projects.
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“We are working on some projects at the moment which we are going to launch on P2P and we are speaking to investors who say they are waiting for the right projects to come through,” she said.
“There is still a lot of interest for the P2P.
“Equity has been popular for us but that’s because that’s been the focus for us for a while and more effort has gone into it.
“But in light of the bond restrictions put in place, we’ve seen P2P lending becoming much more popular and is also where people are putting their efforts in the moment.
“So, in this environment it does make sense to focus our energies onto P2P lending although we have to maintain that balance because ultimately we offer both equity and P2P.”
Poonwassie said the equity part of the business is most at risk in the current economic environment because if there’s movement in price that’s the part that’s going to be most affected.
“Equity will be the one that’s most affected more in this market, but we’ve been inundated with projects across the board,” she said.
Poonwassie also predicted that there will be a recession, but said that P2P will survive it.
“I think there will be a recession, but I think it will be controlled rather than freefall because of some of the measures the government has put in place,” she said.
“But that’s a really difficult one because we just don’t know. It’s not something we have experience of in any shape or form in the past 100 years at least.
“I think there will be casualties in the P2P market, and it will be tightening up processes. I think once it does pass the market will just fly.
“There are things we’re looking to put in place but at the moment we need to see what the market does first. At this point the market is a bit too unstable to bring in anything.”
Poonwassie said to mitigate risks from Covid-19 the Simple Crowdfunding team is working from home, face to face meetings have moved to electronic, training has been postponed in the short-term until it can be moved to online and site visits are postponed or cancelled.
“It’ll be interesting to see what happens to existing projects and if they will take longer to complete,” she said.
“At the moment people still are on the sites working but it’s whether or not that changes soon.
“It’s not knowing. We’re keeping our options open and are just monitoring the situation.”