CoAssets (ASX:CA8) talks crowd funding and business opportunities

Interviews

by Carolyn Herbert

CoAssets Limited (ASX:CA8) CEO, Getty Goh, discusses the company’s crowd-funding platform, the size of the SME market and its business model.

CoAssets is the region’s first listed crowd-funding platform, we match opportunities with investors all around the region. So that in a nutshell is what CoAssets is all about. For the IPO we raised about $6.5 million, prior to that we were actually listed on the Newcastle Stock Exchange. Collectively, the last 12 months we raised about $12 million for ourselves. Why do we list in Australia – why not? Australia is a great country, it is a place where we want to set up business, have our roots in. So naturally Australia and listing on the ASX makes a lot of sense for us.

The funds will be used to expand our operations in the five regions that we currently have offices in. Right now we have offices in Singapore, Malaysia, Indonesia, China and Australia. So essentially the funds we used to grow our operations there. Now in terms of loans, in the last two years through the site, we have facilitated more than $45 million worth of transactions. And we hope to realise a significant increase from this figure.

We specialise in the funding gap of between $1 million to $5 million. What really sets us apart is our focus on asset-backed crowd-funding. What this means is that typically developers looking for mezzanine or bridging loans of between $1 million to $5 million, they can come to us. On top of that, we also service the businesses that are looking for an amount around that range. And what is critical is that all these businesses would have to put some form of asset or collateral, or personal guarantee, to make this whole thing safe. Ultimately our focus is on our investors’ protection, so that’s a key focus that we’re looking at.

Our agreement with Valiant Finance is one of great partnership. We are actually looking to work with them, as a way of reaching out to the Australian business community. They’ll be a channel and we look forward to releasing more news of our collaboration in the coming months. With things in the right perspective, what we’ve seen in the last two or three years that we’ve been doing, real estate loans are about say 60 to 70 per cent, whereas SME is the rest.

So that will give you a flavour of how we size the market up going forward, simply because the ticket size for real estate, is going to be much bigger. So for every real estate crowd-funding deal that you do, you can probably do three or four business crowd-funding deals. So from that perspective, we expect the real estate slice to be a much bigger piece of the pie.

We make money via providing service of matching businesses to lenders. And for each match, we charge between three to five per cent. Now this is just the beginning, we have a registered lender base of more than 56,000. And we’re confident that in the coming months, we’ll be able to provide even greater value-added services to this group, and find innovative ways to make even more money.

Looking at what we’ve done for FY16, our revenue grew 167 per cent from the year before. And I think we ended last year with about a revenue of $2 million. We expect to better that this year and it is still early, we’re only down our first quarter and there’s still a lot of time for us to make money. And I think it is something that we’re working hard to do.

The long-term goals of CoAssets are to be a regional crowd-funding platform; to facilitate deals and fund flows across the region. Our aim is to let someone in Australia, who has a great idea, a great project, put it up on CoAssets so that someone in China, Singapore, Malaysia, they can crowd-fund it with the knowledge that when the tenure is up, when maturity is up, they can get the funds back with the interest. Everything is done safe and sound above board online. So that is the direction that we are driving the business towards.

Now where do we see ourselves in a year’s time? We really want to consolidate and strengthen our operations in the five key areas that we operate in. We look forward to providing even greater services and have a greater presence here in Australia. Some of the plans will include looking at how we can move our operations here in Sydney, so that we want to target the financials heart of the whole Australian market. So that in the near-term is what we’re looking to do and we are confident that it is something we can pull off, in the next 12 months.


ENDS

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