Devin Thorpe of CrowdCast speaks to Sam Hodges, CEO of Funding Circle. Hodges was the founder of Endurance Lending and Managing Director of Funding Circle. In this interview, Hodges discusses the merger of Endurance and Funding Circle, as well as the key differences between the U.S. and U.K. debt markets for peer-to-peer.
The discussion also discusses the crowdfunding for equity in the U.S. versus that of the crowdfunding for debt. While most of the excitement in the startup and financial industry surrounds the equity-based capital raises, Hodges feels that the market for debt has more potential.
"Equity, by nature, is a longer-term investment product than debt–in most cases," Hodges said in the interview. "Most of the equity crowdfunding platforms out there are about an investor putting an equity check into a company and then hoping over its lifetime that investment does really well. That's challenging because it means you have a lot of time between when someone needs to write a check and if and when that investment is actually monetized. Debt is a completely different game."
Funding Circle USA is an online loan marketplace that connects small businesses looking for up to $500K with accredited and institutional investors, according to the company's website. Endurance merged with Funding Circle in October 2013 to form Funding Circle USA, a robust marketplace for small businesses to secure funding from accredited investors.