Money&Co’s new loan for music publishing company Bsides Music, has proved popular with investors subscribing to 47 per cent of it in just two days.
The five-year loan, which is at eight per cent yield with A+ security, is to acquire a catalogue of music rights from a songwriter who specialises in Christian music.
The cost of the acquisition is £538,000 (including deal costs) and the company is contributing cash of £138,000 with a loan from Money&Co of £400,000 making up the balance.
The loan was added onto the platform on Saturday 28 March and the auction will close at 5pm on Tuesday 31 March.
“In a stay-at-home world where streaming music is more popular than ever, owning music rights has great attractions,” Money&Co said on a blog post on its website.
“We’ve opted for a slower rate of growth than many in the platform lending sector (facilitating some £20m in the past five years) – but our track record on security is consequently exceptional, with an annualised default rate of just 0.03 per cent, far below the industry average.
“The overwhelming priority in today’s troubled world is clear: stay safe, and respect the rules on social distancing.
“If you’ve dealt with these massively important imperatives and have the time and inclination to look at your finances, we have a really interesting new loan with an excellent rating from our credit committee, and a business model that has a very low correlation with wildly oscillating global hare markets.”
Instead of its usual seven per cent annual gross rate of interest for an A plus rated deal, Money&Co has agreed to pay eight per cent because of the ongoing turmoil caused by the Covid-19 pandemic.
Investors will receive some of their capital and interest back each quarter and the Bsides Music loan is eligible for inclusion in Money&Co’s Innovative Finance ISA.
This loan follows the platform announcing in December that it plans to launch an investment product that will provide loans to songwriters and artists secured on their music right