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Post by aidanw on Dec 12, 2019 10:17:03 GMT
With the unexplained departure of Greg Carter CEO is now the time to be running for the hills?
Also, their tweeter feed has been dead since 10th October. I know they are concentrating on digital channels for borrowers but it seems odd not to have tweeted any news.
I think I'm getting out as soon as I qualify for the January bonus. If it's not too late.
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Post by nooneere on Dec 15, 2019 20:35:43 GMT
With the unexplained departure of Greg Carter CEO is now the time to be running for the hills? Also, their tweeter feed has been dead since 10th October. I know they are concentrating on digital channels for borrowers but it seems odd not to have tweeted any news. I think I'm getting out as soon as I qualify for the January bonus. If it's not too late. GS is essentially a venture capital-backed enterprise, so if it fails this would happen with more clarity and responsibility than the cases of LY, FS or COL (and dare I add FO). Venture capitalists are not known for patience with any sign of managerial inadequacy, and simply reading the P2P and AltFi media will reveal strategic blunders by GS. From late 2018 to mid 2019 GS gave out stories about expansion of regional sales staff - yet last month these new recruits, it would appear, were made redundant for the sake of a "digital-focused approach". This followed the announcement that two loans valued at more than £1M had defaulted. The 4thWay website, it may be noted, revealed in August that GS had several very large loans that could wipe out the reserve fund www.4thway.co.uk/candid-opinion/growth-street-update/To answer your question, I have pulled out of GS for the time being. I really hope this company succeeds, but too much depends on the apparently untested "digital-focused approach", while my confidence in their risk analysis is severely dented. If in 12 months time they are profitable and earning good returns for investors, I will happily return. I do like their projected returns, the 30 day loan model, and their philosophy - but not enough to put my money in at present.
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Post by aidanw on Dec 16, 2019 13:12:53 GMT
GS is essentially a venture capital-backed enterprise, so if it fails this would happen with more clarity and responsibility than the cases of LY, FS or COL (and dare I add FO). Venture capitalists are not known for patience with any sign of managerial inadequacy.... Thanks, I didn't really consider the VC management angle which of course is what has driven this change. Feeling a little safer but the whole p2p market seems to be in a worrying state of flux right now. No doubt the p2p landscape will look very different in a few years time.
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ceejay
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Post by ceejay on Dec 27, 2019 16:23:31 GMT
With the unexplained departure of Greg Carter CEO is now the time to be running for the hills? Also, their tweeter feed has been dead since 10th October. I know they are concentrating on digital channels for borrowers but it seems odd not to have tweeted any news. I think I'm getting out as soon as I qualify for the January bonus. If it's not too late. GS is essentially a venture capital-backed enterprise, so if it fails this would happen with more clarity and responsibility than the cases of LY, FS or COL (and dare I add FO). Venture capitalists are not known for patience with any sign of managerial inadequacy, and simply reading the P2P and AltFi media will reveal strategic blunders by GS. From late 2018 to mid 2019 GS gave out stories about expansion of regional sales staff - yet last month these new recruits, it would appear, were made redundant for the sake of a "digital-focused approach". This followed the announcement that two loans valued at more than £1M had defaulted. The 4thWay website, it may be noted, revealed in August that GS had several very large loans that could wipe out the reserve fund www.4thway.co.uk/candid-opinion/growth-street-update/To answer your question, I have pulled out of GS for the time being. I really hope this company succeeds, but too much depends on the apparently untested "digital-focused approach", while my confidence in their risk analysis is severely dented. If in 12 months time they are profitable and earning good returns for investors, I will happily return. I do like their projected returns, the 30 day loan model, and their philosophy - but not enough to put my money in at present. ... and nor are VCs generally associated with anything resembling ethical behaviour vis-a-vis other parties such as, in this case, retail investors. I've now fully exited from GS as well. It's a shame, I really like the way the platform works but the piling of risk upon risk has now considerably exceeded the available return IMHO, and I'm out (even at the expense of dropping a future bonus). "If you're worried about an investment, sell it and stop worrying."
I'm concerned about the future state of the economy generally, given the black hole / cliff edge towards which our beloved "government" are propelling us, and it seems to me that GS's borrowers are likely to be right in the firing line. Add to that an increasing pessimism in the state of P2P, especially the smaller platforms, and I can't justify this punt any more.
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Post by p2plender on Jan 5, 2020 1:23:19 GMT
I got out on news of the defaults. Dipped a small toe back in after reading some calming comments elsewhere. The departure (sudden) of Greg coupled with laying off of staff saw me withdraw the toe dip fully and not to return unless the digital model shows signs of working. Really hope GS succeeds as it was a very good lend n forget.
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Post by gravitykillz on Jan 5, 2020 8:12:13 GMT
I really like the platform and software as well. But its aggressive growth model is putting it too much at risk for my liking. I may return in the future when things improve and I feel more secure but for now ratesetter is the more secure p2p platform at ths moment.
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marky
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Post by marky on Jan 5, 2020 8:45:34 GMT
I've been a supporter of GS (over all the other P2P platforms) for a few years.
I have now totally withdrawn all my cash (including money that would have earned future bonuses) and I swerved the December "cash call" / "bonus".
Why? Well pretty much same reason as everyone else really.
1) I didn't like the large defaults.
2) I didn't like the fact that this was the second time that GS had experienced large defaults that they couldn't recover (they had obviously not learned their lessons from before).
3) If you assume (like I do) that there will be a level of default from P2P loans then it follows that the successful platforms will be the ones who are able to recover their money (from secured assets) when the borrower stops paying. GS have demonstrated, time again, that they struggle to recover money after a default and "tapping the founders for extra cash" or "moving the bad debt to the company balance sheet" is not a sustainable business model. In fact it is bad business!
4) I didn't like the sudden disappearance of Greg Carter. The "face" and "founder" of Greg Carter suddenly vanishes. Why?
5) Now the FCA arent happy with the way that the GS ISAs have been marketed.
This company seems to be lurching from one crisis after another ....... is it time to run for the hills? YES ... I fear it is!
I may return when things stablise ..... but I would like to see a history of recovering defaults before going overboard with my investment again!
Marky
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Post by Companion Cube on Jan 5, 2020 17:33:56 GMT
I was thinking of investing in GS soon but this has put me off. What I don't understand is why 4th Way rates GS in second place out of all P2P platforms, only beaten by Proplend. Is 4th Way not to be taken seriously? I have always liked how strict they come across, i.e. If you don't supply the data then you won't get a rating.
Does anyone have an opinion regarding 4th Way?
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marky
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Post by marky on Jan 6, 2020 12:13:44 GMT
Hi, I think the 4th Way review was done before the recent "issues".
I was persuaded to invest by the 4th way review too but am completely divested now having switched to Assetz Capital.
Marky
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Godanubis
Member of DD Central
Anubis is known as the god of death and is the oldest and most popular of ancient Egyptian deities.
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Post by Godanubis on Jan 6, 2020 15:26:22 GMT
Hi, I think the 4th Way review was done before the recent "issues". I was persuaded to invest by the 4th way review too but am completely divested now having switched to Assetz Capital. Marky Exactly the point Marky 100% diversification and proper diligence is more likely to result in a positive outcome and vastly reduces the chances of overall loss and individual investments are less important.
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Post by Companion Cube on Jan 6, 2020 18:01:25 GMT
Thanks for your answers guys. I guess 4th Way should really keep their reviews more up-to-date if they are to be taken seriously.
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Post by nooneere on Jan 6, 2020 20:20:26 GMT
4thWay are currently advertising for (volunteer) members of their 'panel' - www.4thway.co.uk/news/man-down/Their value would be enhanced by having someone from our site join. I still have a day job so I'm not doing it (and don't really have enough experience of P2P). Their engagement with platforms does yield useful insights - as mentioned in my post of 15 Dec, they revealed that GS had some disproportionate loans before the problems arose. But they still have a surprisingly placid view on GS as has been noted. I would add they still have glowing praise for FC's DD processes, so make of that what you will. I read them but don't follow their advice basically.
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sd2
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Post by sd2 on Jan 6, 2020 22:11:56 GMT
I thought right from the start that growth street was dodgy the moment I got my bonus I was gone. 5.3% plus 4% (£200 bonus) made it worth the risk....just. I just did not consider 5.3% any where near a fair reward. Basically they were lending to people with cashflow problems or at least that's the way I saw it. Okay cashflow problems maybe exaggerating but I always considered it in that sort of mindset. I suspected they were getting very tasty reward to risk our money. I think everyone is making the right decision get out while you still can.
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Post by dan1 on Jan 6, 2020 22:33:29 GMT
I don't know what's going on at Growth Street and I'm probably not paying enough attention given recent events. Anytime there's a change at board level we (lenders) should take note, even more so when it's a founder and CEO. Something must have gone wrong either at Growth Street or for Greg Carter personally, I hope it's the former for his sake.
I think I'm correct in saying GS has its roots in the VC firm Arts Alliance under the control of Thomas Høegh. I guess it was AA that instigated the change following a (another?) poor year for bad debts. Greg Carter was fairly visible to lenders in terms of his name featuring on the site, emails, blogs and even his mugshot so his departure is noticeable - fintech start ups are highly dependent on individuals.
On 4th Way.... I know little of their site, offering or how they're funded but they state that they earn commission from several platforms. For commission I read affiliate income or cashback and to elevate them from the lofty heights of glorified bloggers I'd need to know which platforms pay the best commission. That's probably very unfair and harsh but I need to know what their incentives are. I'm reminded that the main reason I originally invested in Growth Street was for the generous cashback on offer, one of the highest equivalent rates out there. I'm minded to think incentives for commission/affiliates are pretty good/market leading too.
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jlend
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Post by jlend on Jan 7, 2020 7:45:13 GMT
Greg has not been the only CEO they have had over the years. He was the Risk Officer for some of the time.
A recent funding round bought in a large equity investment from a funder who also is the main backer of Starling Bank.
Starling Bank is where Growth Street is now going to originate most of its business along with an online accounts company Xero.
Growth Street is a lending option on the Starling Bank marketplace and they already originate lending via it.
Starling Bank were given £100m from the RBS Capability and Innovation bailout fund to spend on improving access to bank lending for SMEs
I think it makes sense for GS to leverage the origination capabilities of the likes of Xero and Starling Bank rather than building their own capability. It can't have been easy to scale up to target SMEs directly. Xero and Starling will have a lot of useful info on companies with the advent of open banking.
Greg is staying on as an advisor for the time being I see.
GS are probably at the point they would benefit from new management as they push forward with their new strategy.
I see GS are also using some of the money raised in the last funding round to build up their institutional lending vs using retail lenders like ourselves. Am not surprised given we are seeing other platforms increase institutional lending or drop retail lenders completely. Some platforms like RS have stated they are sticking with retail lenders though.
iwoca is an example of another company targeting SME lending like GS, they are not p2p. They also got some funding from the RBS bail out fund. It will be interesting to watch how GS can compete with these other new lenders over the next few years. It will also be interesting to watch how the likes of Starling and Atom Bank build up their own internal capability for SMEs vs using third parties like GS. GS were trying to get some money from the RBS fund but as far as I know didn't get any.
GS isnt unique in having an issue with its PF. RS had an issue with Adpod and wholesale lending, Lendingworks has had to drop their lending rates, the GBBA1 PF looks like it might be insufficient at AC etc. It will be interesting to watch how these funds cope longer term though a couple of economic cycles.
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