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Borro Private Finance Featured in Antiques & The Arts Weekly

Our Chief Commercial Officer, Claire Hillier, joined Antiques & The Arts Weekly for their featured story to discuss what the first 10 years of Borro Private Finance have been like and what the future holds.

Borro Private Finance Antiques & The Arts Weekly

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Borro Private Finance is a relatively new player in the luxury asset market, but instead of buying and selling, they provide loans secured against such assets, tapping into a large network of appraisers and auctioneers and providing non-bank financing options for immediate access to capital. With a few different options for clients, Borro Private Finance has funded more than $400 million since 2008. As the company marks its 10th anniversary, Antiques and The Arts Weekly caught up with Claire Hillier, Borro Private Finance’s Chief Commercial Officer, for additional insights into Borro Private Finance’s success.

In a nutshell, how does the process work? What are the differences and benefits of each of them?

We offer three types of loans. In a “sale advance loan,” Borro Private Finance advances a client money and manages the sale of their asset through a global network of auction houses. This is ideal for clients who have made up their mind to sell, who do not have an emotional attachment to the value of an item, and who are willing to wait for the best and most appropriate auction. With a “bridge loan,” the client uses their asset as collateral without having to sell the asset. The asset is returned to the client at the end of a loan period once the client has paid the loan amount and accrued interest. That option is great for clients who need money quickly and can repay Borro Private Finance within six months. A “term loan” is like a bridge loan but differs in that the length of the loan is longer.

Are there minimum / maximums for these loans? Is there a typical loan amount?

In general, we do not loan against very many items valued below $50,000. At the moment, we will loan as much as $30 million against an item. Our average loan is currently $150,000 but we are on track for that to rise to $500,000. We find that our sweet spot is for items valued between $500,000 and $5 million.

Is Borro Private Finance unique in the industry? What sets Borro Private Finance apart?

Borro Private Finance is not completely unique, but we were the first game in the industry, the first to leverage high-end assets. We occupy a space with fewer competitors, and because we lend against a relatively broad spectrum of assets, not just art, we can represent a higher volume of assets. We use our extensive network of contacts of appraisers and experts to identify the best venue for a specific item, even if that means a collection is sold across multiple venues. Clients come to Borro Private Finance because they want our expertise to guide them.

What is the advantage of working with Borro Private Finance over, say, a fine art dealer or other agent to negotiate the sale?

Borro Private Finance provides a very independent, unconflicted role in the market. We do not make money selling assets, we are only interested in making money through lending.

When looking for an auction house to consider selling an asset, what factors do you consider? Which auction houses does Borro Private Finance work with? Do you ever work with a private gallery?

Borro Private Finance looks at the track record of an auction house with that asset. We gauge their excitement in an item, the strategy they propose for selling it, if there is anything comparable in the sale. Another influencing factor is the timing of the sale and how that fits into our client’s needs. Borro Private Finance has a great track record and strong relationships with all of the houses: Christie’s, Sotheby’s, Bonhams, Phillips, Heritage. Approximately 95 percent of the items we sell go through auction, though there are some instances where we will work with a gallery.

Does Borro Private Finance transact Private Sales? Do you do guarantees?

Borro Private Finance will work with auction houses that do private sales, but in general, we do not partner with houses to secure guarantees.

Auction estimates are not guarantees of sale results. What if an item goes to sale at auction but the sale result falls short of the estimate? What if the sale result exceeds expectations?

In the case of the former, Borro Private Finance assumes that risk and the client would not be obligated to pay the difference. In the case of the latter, the client would benefit from any upside achieved at sale after repaying the loan amount, which frequently happens.

What are some of the more unusual or unique items Borro Private Finance has loaned against?

Borro Private Finance has lent against an Olympic gold medal, an Oscar, a Super Bowl ring, some costumes and some sports memorabilia.

Is Borro Private Finance looking to expand into other asset categories in the near future? Conversely, are there asset categories Borro Private Finance is likely to stop loaning against?

Borro Private Finance is not likely to expand our asset categories. Right now, musical instruments and items with restricted materials, such as ivory or rosewood, can be very challenging. Borro Private Finance has to be sensitive of downward trends that might cause many items in a specific asset class — such as furniture or other decorative arts — to become limited in terms of what we would loan against.

Borro Private Finance is celebrating a ten-year anniversary this year — what do the next ten years look like?

We are in the middle of a rebrand. We are planning to expand our presence in Los Angeles, to join our existing offices in London and New York City. Other areas we might expand into include Miami, Dallas, possibly Denver. There is less focus on expanding on the Continent because there is so much opportunity for growth in the United States.

Borro Private Finance is a relatively new player in the luxury asset market, but instead of buying and selling, they provide loans secured against such assets, tapping into a large network of appraisers and auctioneers and providing non-bank financing options for immediate access to capital. With a few different options for clients, Borro Private Finance has funded more than $400 million since 2008. As the company marks its 10th anniversary, Antiques and The Arts Weekly caught up with Claire Hillier, Borro Private Finance’s Chief Commercial Officer, for additional insights into Borro Private Finance’s success.

In a nutshell, how does the process work? What are the differences and benefits of each of them?

We offer three types of loans. In a “sale advance loan,” Borro Private Finance advances a client money and manages the sale of their asset through a global network of auction houses. This is ideal for clients who have made up their mind to sell, who do not have an emotional attachment to the value of an item, and who are willing to wait for the best and most appropriate auction. With a “bridge loan,” the client uses their asset as collateral without having to sell the asset. The asset is returned to the client at the end of a loan period once the client has paid the loan amount and accrued interest. That option is great for clients who need money quickly and can repay Borro Private Finance within six months. A “term loan” is like a bridge loan but differs in that the length of the loan is longer.

Are there minimum / maximums for these loans? Is there a typical loan amount?

In general, we do not loan against very many items valued below $50,000. At the moment, we will loan as much as $30 million against an item. Our average loan is currently $150,000 but we are on track for that to rise to $500,000. We find that our sweet spot is for items valued between $500,000 and $5 million.

Is Borro Private Finance unique in the industry? What sets Borro Private Finance apart?

Borro Private Finance is not completely unique, but we were the first game in the industry, the first to leverage high-end assets. We occupy a space with fewer competitors, and because we lend against a relatively broad spectrum of assets, not just art, we can represent a higher volume of assets. We use our extensive network of contacts of appraisers and experts to identify the best venue for a specific item, even if that means a collection is sold across multiple venues. Clients come to Borro Private Finance because they want our expertise to guide them.

What is the advantage of working with Borro Private Finance over, say, a fine art dealer or other agent to negotiate the sale?

Borro Private Finance provides a very independent, unconflicted role in the market. We do not make money selling assets, we are only interested in making money through lending.

When looking for an auction house to consider selling an asset, what factors do you consider? Which auction houses does Borro Private Finance work with? Do you ever work with a private gallery?

Borro Private Finance looks at the track record of an auction house with that asset. We gauge their excitement in an item, the strategy they propose for selling it, if there is anything comparable in the sale. Another influencing factor is the timing of the sale and how that fits into our client’s needs. Borro Private Finance has a great track record and strong relationships with all of the houses: Christie’s, Sotheby’s, Bonhams, Phillips, Heritage. Approximately 95 percent of the items we sell go through auction, though there are some instances where we will work with a gallery.

Does Borro Private Finance transact Private Sales? Do you do guarantees?

Borro Private Finance will work with auction houses that do private sales, but in general, we do not partner with houses to secure guarantees.

Auction estimates are not guarantees of sale results. What if an item goes to sale at auction but the sale result falls short of the estimate? What if the sale result exceeds expectations?

In the case of the former, Borro Private Finance assumes that risk and the client would not be obligated to pay the difference. In the case of the latter, the client would benefit from any upside achieved at sale after repaying the loan amount, which frequently happens.

What are some of the more unusual or unique items Borro Private Finance has loaned against?

Borro Private Finance has lent against an Olympic gold medal, an Oscar, a Super Bowl ring, some costumes and some sports memorabilia.

Is Borro Private Finance looking to expand into other asset categories in the near future? Conversely, are there asset categories Borro Private Finance is likely to stop loaning against?

Borro Private Finance is not likely to expand our asset categories. Right now, musical instruments and items with restricted materials, such as ivory or rosewood, can be very challenging. Borro Private Finance has to be sensitive of downward trends that might cause many items in a specific asset class — such as furniture or other decorative arts — to become limited in terms of what we would loan against.

Borro Private Finance is celebrating a ten-year anniversary this year — what do the next ten years look like?

We are in the middle of a rebrand. We are planning to expand our presence in Los Angeles, to join our existing offices in London and New York City. Other areas we might expand into include Miami, Dallas, possibly Denver. There is less focus on expanding on the Continent because there is so much opportunity for growth in the United States.

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Borro Private Finance Featured on WealthManagement.com

Our Chief Commercial Officer, Claire Hillier, joined WealthManagement.com to discuss the personalized services Borro Private Finance provides to clients that enables them to raise liquidity efficiently and discreetly.

Borro Private Finance WealthManagement.com

“Whether it’s hefty legal bills, private school tuition or an unpredictable cash flow, there are several reasons why high net-worth individuals may need to raise liquidity in a timely manner. Yet regulatory issues can make it difficult to access loans from traditional lenders, whatever your financial status, says Claire Hillier, Chief Commercial Officer for international private lender Borro Private Finance.

Difficulty in raising liquidity can lead individuals to methods of funding that can hurt their financial plans. “Wealth managers tell me that if they are doing a good job at managing their client’s money they just shouldn’t have large quantities of cash sitting around”…..”

Read the full article here https://www.wealthmanagement.com/wealth-planning/tapping-value-luxury-items

 

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Art Secured Financing: What You Need to Know

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Ashley Lockwood, UK Business Development Manager for lender Borro, agrees, adding that demand for art-secured lending is increasing. “As the value and frequency of art transactions increases, so does the need for alternative financing solutions that enable clients to seize opportunities,” he says.

“Much like a property portfolio, an art portfolio can be utilized to raise liquidity in a number of scenarios. Clients are becoming increasingly savvy in the way that they approach lending and art has become more of a legitimate asset class.”

In this changing landscape, more lenders are emerging outside the traditional option of banks. Borro is one such example. It’s a specialized finance firm that provides loans secured against Fine Art, Classic Cars, Watches and Jewellery. Borro can leverage various asset classes within the same loan, to get the client where they need to be.

“This sets us apart from other art financiers on the market,” says Lockwood. “Our primary goal is to provide high-net worth individuals with a source of non-bank finance, allowing clients to raise liquidity with speed, privacy and impeccable service.”

Borro’s clients usually look to leverage artworks to raise funds to take advantage of a business opportunity, invest in real estate, relieve tax burdens and legal fees – or they simply want to raise capital for the purchase of another work at auction.

“Due to the simplicity and speed we offer, we are often the quickest and most efficient way to raise capital,” says Lockwood.

Borro will generally lend up to 50% of the value of the work. Its ability to lend is determined by a number of factors including provenance, estimated market value and risk associated with the work in question.

Works are stored in Borro’s storage facility for the duration of the loan. “Our logistics, storage and insurance are all industry recognised and can meet the standards set by our clients,” says Lockwood.

Read the original article at Happening.

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Investment firm helps restructure online loan provider Borro

Under the new deal, VPC Speciality Lending will own around 49% of Borro and the remaining 51% of the equity will be held by other vehicles managed by Victory Park Capital and Borro’s senior management team.

VPC will provide Borro with a credit facility of up to $10m. VPC first became involved with Borro when it provided a credit facility in February 2014.

Borro, founded by Aitken in 2009, loans between £5000-5m against the value of luxury items including fine art, jewellery, watches, fine wine, and classic cars.

As part of the new investment, VPC partners Tom Welch and Gordon Watson have joined Borro’s board of directors. Earlier this year John Allbrook joined as executive chairman and CEO.

“Fragmented and niche market”

Allbrook said: “Despite several business and leadership shifts over the past two years, we feel confident that with VPC’s partnership, we can capitalise on what remains a fragmented and niche market that continues to be underserved.”

The financial restructuring required change of control approval from the Financial Conduct Authority (FCA) earlier this month and has now completed. As part of the restructuring a subsidiary, Borro Group Holdings, was placed into administration and PwC was appointed administrator. However Borro’s trading companies and assets remain solvent and are not effected by this move.

See the original article at antiquestradegazette.com

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Stop dreaming and start buying with a little help from Borro

Tired of just dreaming about adding the classic and collectable cars in the Classic Driver Market to your garage? Borro offers a loaning opportunity that might make your dreams a reality. We spoke to the company’s executive vice-president and managing director of global originations, Claire Hillier…

How long has Borro been offering classic car and supercar finance?

We launched back in 2008, but we didn’t offer car loans for almost a year afterwards. Once we were established and comfortable with the market, we began lending and have been ever since.

How has the market, in terms of lending for collectable cars, changed in that time?

Around 2012, we were mostly writing car loans below 100,000 US dollars, but as the years have gone by, we’ve been seeing far more people lending against cars while they wait for their value to appreciate.

In light of recent market adjustments, have you seen an impact on financing?

The crazy figures we all saw in Monterey in 2014 was the peak, but we’ve not seen a material change in the value of our loans or the number of people coming to us since then. Those people who are, say, in the industry and have taken advantage of slight market dips and discovered a bargain are often taking finance out with us to mediate the risk in the time it takes for the car to appreciate further. Is loaning against your car more common in the classic car world now?

It’s become far more of a normal thing to do now — some collectors used to consider lending against their cars as taboo, but as they’ve started to be viewed more as tangible assets, people have realised that it’s a smart way of securing a loan. If you’re sitting with a multi-million-pound collection and see a great car come up at auction, for example, it’s a great way to leverage against your existing appreciating assets in order to acquire more. When we lend against a vehicle, we’re looking for universal demand. We have a responsibility to sell the car for the highest price possible in a short timeframe, should the loan default, so we find that most loans are actioned against solid and dependable brands and models.

Read the full article at ClassicDriver.com

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Borro posts operating profit after pivotal year

Luxury asset lender Borro has posted an operating profit of £1m for last year following its entry into the property market in August 2015.

Despite reporting an operating loss of £7m in 2014, the firm said it was now on track to deliver over £5m in operating profit for 2016.

After accounting for loan funding costs, Borro did report a loss of £2.7m for 2015, up from a £9.8m loss in the previous year.

The firm predicts a small profit after loan funding costs in 2016, and expects to achieve gains of £3-4m in 2017.

This news comes just days ahead of Borro’s launch into the regulated bridging and consumer buy-to-let loans market.

Paul Aitken, founder and CEO of Borro, said: “2015 was a pivotal year for Borro.

“Our terrific team has perfected the model allowing us to dramatically improve our financials.

“Larger loans from valued partners, such as auction houses, brokers and private banks, are growing our top and bottom lines.”

Borro experienced a 50% rise in business generated through its partner channels during 2015.

Customer loyalty also grew, with 70% of revenue coming from existing clients.

Meanwhile, the firm saw its interest and fee revenue increase 16% to £10.6m, and predicts further growth of 30% during 2016.

“We have demonstrated that our business is fundamentally profitable,” Paul added.

“This has put us in a position where we are confident that we will secure significantly lower loan funding costs, which will have an immediate and positive impact on the business in 2017.”

Earlier this year, Borro upgraded its membership to become a full member of the Association of Short Term Lenders.

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Borro Makes Top 20 of SME Export Track 100

Luxury asset and property lender Borro has been ranked 20th on the Sunday Times Heathrow SME Export Track 100.

The Export Track 100 ranks Britain’s SMEs by their international sales growth over their last two financial years. Borro maintains offices in New York and Los Angeles, allowing it to service clients and their advisors across the United States in addition to its UK base. Clients leverage assets such as fine art, classic cars, luxury watches, fine wine, and properties, for loans from £5,000 – £5,000,000.

Since launching in the US in 2012, Borro has experienced rapid expansion both home and abroad.

“It was incredible taking a new business to America,” said Paul Aitken, CEO and founder of Borro, “Our innovative approach to lending means that no matter where we are, or the assets our clients use, the experience is always the same: fast and with a level of service you can’t find anywhere else.”

Borro expects its growth in both the UK and the US to continue and is “looking forward to an exciting 2016”.

Read the original article on Specialist Finance Introducer

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Borro up for European FinTech Award

Borro’s lending platform has been nominated in the Alternative Finance category at the European FinTech Awards.

The platform provides flexible and fast finance for property and luxury assets including watches and cars.

The European FinTech Awards brings together companies from across Europe and showcases the best technology-based solutions for a range of financial needs.

Each nominated company is assessed by a panel of expert judges from a number of major global banks and venture capital firms.

Based on their assessment, and the outcome of public voting, companies become part of the FinTech 100 before progressing to the final awards.

Paul Aitken, CEO and Founder, said Borro’s recognition on the European stage showed just how innovative the online lender is.

He claimed just a few companies could do what Borro had done, having expanded into property lending in a matter of months.

“We were able to do this because we leverage technology in a way other lenders don’t,” said Paul.

“Clients now come to us for lending on property and luxury assets at the same time.

“We offer a single platform that lets them raise bridging finance and use other assets to cover shortfalls.

 

“Clients use jewellery, watches, and art to cover costs that would otherwise hold up the bridging process.”

 

Voting closes on 15th March and the final awards ceremony takes place in Amsterdam on 14th April.

To view Borro’s page and vote, please click here.

 

Read the original article on Bridging & Commercial.

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2015’s biggest investments: Borro £13m

Long term growth funding for luxury asset-backed lending platform Borro

Company: Borro

Description: Luxury asset-backed lending

Founders: Paul Aitken

Based in: London

Raised: £13m

Investors: OurCrowd, Rocket Internet, Canaan Partners, Eden Ventures, Augmentum Capital

10

“This funding will enable us to accelerate our growth in our core US and UK businesses. We will continue to grow through our already successful partnership channels as well as our expansion into new product areas.”

Jon Medved, founder and CEO of OurCrowd:

“Working with Borro marks the single largest equity crowdfunding round ever completed and demonstrates how equity crowdfunding can complement traditional funding sources. We are thrilled to be investing in quality companies like Borro that are redefining the FinTech industry.”

Read the original article on Startups.

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