Bondmason is an aggregator of peer to peer loans, their system facilitates broad diversification among different peer to peer platforms. In this interview, Stephen Findlay CEO of Bondmason, has explained more about the opportunities the BondMason has to offer.
Can you introduce yourself?
I am Stephen Findlay, CEO and one of the directors of BondMason. I’m a chartered accountant by training and have spent the last 15 years in the investment management industry.
What is Bond Mason?
BondMason is the UK’s leading investor-only platform for direct lending. We navigate the large, growing and complex P2P Lending market, to enable our clients to access returns from a curated set of opportunities, targeting a gross return of 8.0% p.a.
What are the advantages of having Bond Mason select p2p investments for their investors?
P2P Lending is not a homogeneous asset class – there is a wide diversity of investment opportunities from a broad range of operators. BondMason sources platforms and conducts due diligence on each platform prior to considering for approval. We then review each loan from approved platforms, and select 1 in 3.
The investment team has a combined experience in excess of 50 years and has successfully invested in excess of £2bn. Our clients benefit from our rigorous approach, and have achieved a gross return in excess of 8.0% in each of 2015, 2016 and 2017 to date.
In addition to p2p lenders does Bond Mason source loans from other firms?
We have developed some exclusive relationships with specialist lenders, that have been lending for 20+ years
Does Bond Mason provide access to investments which are harder to access for the retail investor?
Yes – over half of our loans aren’t accessible to retail investors directly. Many of these present a better risk-return profile than they may be able to access elsewhere., which is one of the key reasons clients choose BondMason.
Do users underestimate the time needed to manage a p2p portfolio?
I think many early investors in P2P Lending saw it as a hobby as well as an interesting investment opportunity. But as the asset class becomes more mainstream, we are seeing more and more clients wanting to take a back seat, using Auto-bid services such as BondMason’s, to help them distribute and manage their funds more effectively.
If an investor decides to invest £5000 in how many loan parts would that amount be split?
Clients choose if they have a minimum of 50 or 100 loan parts.
Typically, how long would it take for an investment of 5000£ to be fully invested on the platform?
The average is 28 days.
Typically how much time is needed for investors to liquidate their holdings on Bond Mason?
All clients have been able to fully liquidate in 48 hours to date.
What is Bond mason’s “risk mitigation strategy”?
In our opinion, a provision fund reduces returns over the long term for all well-diversified investors. We wanted our clients to be able to achieve the highest possible return from their positions, which is why we haven’t implemented a provision fund.
Investing through Bond Mason diversifies risk through many p2p lenders, however, there is still a single point of failure: Bond Mason. What is the risk mitigation strategy for this risk?
The clients positions are separate and segregated from BondMason. So the two (client positions and BondMason) are bankruptcy remote – so there isn’t a single point of failure.
The peer to peer universe is quite diverse in terms of expected ROI, how does Bond mason position itself in this market?
We aim to be at the more conservative end – whilst client capital is at risk and there may be defaults, we enable clients to target a gross return of 8.0% from investing primarily in property-backed and asset-backed loans.
The typical investment advice is to have a mix of stocks and bonds. How does the peer to peer asset class fit into this model?
As you note above, there is a real range in the risk profile available from P2P Lending. In some cases it is less risky thank stocks and shares, and in some cases it is much more risky. We aim to operate somewhere in the middle of stocks & shares and cash: a focus on capital preservation with the opportunity to achieve a good return.
Where do you see Bond Mason in the next three to five years?
We aim to continue doing what we are doing: enable our client to achieve attractive risk-adjusted returns from lending. This may take us abroad in the future, but it is not on our immediate roadmap.
To find more information visit: http://www.bondmason.com/
We thank Stephen Findlay for the interview.