Marketplace lender looks to expand into broker channel

Speaking to The Adviser following the announcement that he had been made the peer-to-peer lender’s permanent chief executive officer, Mr Jones revealed that the company had been on a strong growth plan since he had joined in February 2018, when he was CFO and commercial director.

While the lender’s co-founder last year revealed the reasons behind why the company had “steered away” from the broker channel, Mr Jones told The Adviser that he wanted to “open the broker channel” to its unsecured personal loans amortising product.

Mr Jones said: “When I came in [to the company], back in February, what we wanted to do was really refocus on growth and there was a couple of elements to that we’ve been working through.

“For me, there was one thing that was going to be done, which was to open the broker channel as a partnership channel.”

The SocietyOne CEO said that the company had been working in partnership with aggregator Outsource Financial to design and build the broker application and origination process and to “ensure all their brokers were supportive of the experience and the capabilities” of the fintech.

The project, which was delivered over the final week of May and the first week of June, has helped deliver nearly $1 million of loans via the broker channel.

“We would hope to get that [figure] towards $3–$4 million by the end of the year, so that channel is looking really good for us,” Mr Jones told The Adviser.

“We took our time building a great process with Outsource and we’ve been talking to other people about using the same process and it’s going very well, so we’re really keen about the broker channel.”

Mr Jones went on to highlight that the lender was looking to work with brokers that particularly focus on personal loans and “work with them to provide a good deal to their customers and provide the brokers with a great experience”.

As well as extending its reach into the broker channel, SocietyOne has also been looking to boost growth through its new credit scorecard that aims to “better assess and price risk”, a new application form to streamline and update the customer journey and a new marketing campaign across media outlets.

“So, with those four things combined, there has been a lot going on to make sure we’re well positioned for growth and to make the business successful,” Mr Jones said.

He concluded: “With more than $60 million in committed investor funding at present, and continued interest from a number of institutions, we are in a strong position to further grow lending over the remainder of the year.

“The next six months will be another exciting period of growth and innovation. While there is a lot of work to do, the momentum in the business is really pleasing.

“By the end of 2018, we will be well positioned for the next phase of growth. We remain on track to achieve operating break-even by March 2019.”

When asked whether the company would pursue an ASX listing next year, the new CEO said: “At the moment, working with the shareholders, we don’t have any particular plans on IPO, but it is something that gets evaluated when you get to that break-even point.”

He continued: “I think the appropriate answer is that we’ve been running for six years, we’ve just celebrated our sixth birthday and we’ve been through $500 million of originations. Our objective is to get to break even in the first quarter of 2019 and in getting to break even, it creates opportunities for shareholder action, whatever that might be.

“The important thing is that from a management perspective, we’re building a strong business, we’re building a growing business that is strong and profitable and that’s our focus.”

The company is currently celebrating its sixth anniversary of operations, with total lending from its investor funders at over $480 million and its current loan book sitting at just over $220 million.

[Related: Lender explains decision to ‘steer away’ from brokers]