New ‘Leader Lender’ emerges to drive British businesses back to recovery

The Rise of the Leader Lender, a report commissioned by peer to business lender FundingKnight and produced by independent trends agency The Next Big Thing, finds that crowdlending is attracting a significant number of business leaders, who are using their own business experience and building on a desire to ‘give something back’, to invest in and drive other companies to success. Half of High Net Worths questioned for the report had either tried peer to peer lending, or would consider doing so, while 82% were either seasoned business leaders, or professionals who had aspired to run their own enterprise. And while the report finds this new breed of investors, christened ‘Leader Lenders’, are using their business experience to inform their own personal investment decisions, it shows a strong entrepreneurial desire amongst them to invest in dynamic new sectors and industries- in fact three quarters of respondents said they use peer to peer lending to invest in industries they haven’t worked in themselves.

The report shows that wider societal trends are influencing Leader Lenders, encouraging them to embrace ways to do business in the UK differently.

A love of Community and a desire to ‘give something back’ rates very highly for the new breed of investors, with a quarter of Leader Lenders saying they like to get actively involved in their local community and less than one in six saying they see themselves as an individual. Nearly half of Lender Leaders say that being able to help British businesses succeed was a motivating factor to use peer to business funding.

The ability to take Control is identified as the joint main driver for Leader Lenders to adopt peer to peer lending, with almost a quarter of High Net Worth Individuals questioned saying they manage all of their own investments, and nearly all of them (90%) expressing a preference for taking control of the situation around them.

The new breed of investors are also satisfying their strong sense of Curiosity, with their openness to innovation, interest in new ideas and technologies and their general position as ‘early adopters’ all identified as key reasons they’re taking the lead when it comes to investing in, and backing, British businesses.

Graeme Marshall, Chief Executive of the peer to business lending platform FundingKnight that commissioned the research, said: “This report shows that peer to business lending is tapping into and facilitating a mood in the UK to do business differently. Experienced businesspeople are taking their skills and knowledge and leveraging them to make wise investment decisions that in turn are helping drive the success of other British SMEs, with three quarters using their professional experience to influence their personal investment decisions.

“In fact a fifth of this new breed of Leader Lenders, so called because they’re seizing the opportunity to invest in British SMEs and help drive them back to recovery, say they’re using peer to business lending as a way to keep their hand in with business, for example after retirement. By backing strong businesses with well-thought out business plans whose only impediment to success could be accessing the funding they need, these Lender Leaders are playing a crucial role in the economic recovery.”

Top three things Leader Lender investors are looking for when it comes to investing in SMEs:

– Previous profitability (47%)
– A business person they can trust (41%)
– A good idea (29%)

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