Operating an online luxury asset lending platform featuring fine wine, art, antiques and other luxury goods, Borro Inc. originated £49 million in loans last year to cash-poor, asset-rich individuals. That amount, which generated £13 million in revenue, was up 80% from the previous year.
The startup’s growth, along with its unique niche within a large and growing group of alternative lending tech startups, captured the attention of private investors who plowed £13 million into Borro to bankroll its continued expansion.
“We wanted investors that could add value without adding complexity,” said Borro founder and Chief Executive Paul Aitken, saying the round was the easiest fundraising he’d ever done and he was able to complete the process in a little more than four weeks.
New investor crowdfunding platform OurCrowd and existing investor Rocket Internet co-led the Series E infusion, with participation from existing investors including Canaan Partners, Eden Ventures and Augmentum Capital.
Mr. Aitken said based on Borro’s expansion plans, both in product and geography, OurCrowd and Rocket Internet were logical partners.
Since launching operations in London in 2009, Borro has expanded its product only slightly. Borro offers a “sale advance,” which enables customers to obtain 70% of the estimated price of an item before it sells. But the vast majority of Borro’s business operates similar to that of a private bank, with the startup extending loans to individuals based on the value of luxury goods they put up as collateral. Once Borro appraisers establish the value of an item, Borro extends a loan offer to the individual. Those loans, which carry a 2.99% to 3.99% monthly interest rate, are usually six month arrangements with 90% of all customers paying them back in full.
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