German mid-market lender Creditshelf to go public

Funding Circle’s landmark IPO – expected to happen this year – seems to have triggered a flotation-fever, with German mid-market lender Creditshelf now getting in on the act.

For some months now, momentum has been building behind what will be a historic IPO for the world’s first peer-to-peer business lender Funding Circle. The company is expected to raise in the region of £1.5bn in a listing on the London Stock Exchange.

But while Funding Circle has been lining up all the right pieces (banks, senior hires, a new performance page, etc.), another business lending platform beat it to the punch.

Last week, peer-to-peer business lender Raize announced its intention to become the first IPO to launch in Portugal since 2014. The firm is placing up to 15 per cent of its shares on the Lisbon Stock Exchange with a market cap of €10m. An additional 10 per cent of its shares will be made available six months after trading begins on 18 July.

But wait, there’s more.

Creditshelf – a platform unique for its focus on bigger-ticket SME lending – was last week linked with a listing in an article in leading German outlet Handelsblatt. Those rumours were today confirmed by the company.

The lender aims to raise €15-20m through floating its shares on the Regulated Market (Prime Standard) of the Frankfurt Stock Exchange. The IPO is scheduled for the third quarter of 2018.

Long-term shareholder Hevella Capital GmbH & Co. KGaA, which is controlled by Rolf Elgeti, will place a backstop order of €15 as part of the listing.

Creditshelf launched in Germany in 2015. The firm says it had fielded more than 1,100 loan applications, carrying a volume of around €900m, as of 31 March 2018. In that same period it has lent €58m, with an average loan size of €540k, an average interest rate of approximately 9 per cent and an average term of 17 months.

Within its niche, Creditshelf sees a ‘credit gap’ of around €100bn, resulting primarily from post-crisis restrictions on bank lending. Factoring in existing SME lending volumes and an assumed market penetration of 10 per cent in online SME credit markets, Creditshelf sees an addressable market of roughly €39bn.

The platform funds loans with capital from a number of institutional investors (including Portuguese challenger bank Banco BNI Europa), more than 200 high net worth individuals, family offices and Obotritia Capital KGaA (controlled by Rolf Elgeti) as its anchor investor.

Dr. Tim Thabe (pictured), CEO and co-founder of Creditshelf, said in a statement: “The IPO will enable us to execute our growth strategy based on well-defined pillars such as software investments, product portfolio expansions, and the implementation of banking cooperations approximately €500m in arranged credit volume per year.”