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Funding Societies

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Funding Societies Pte Ltd[1]
Company typePrivate Limited[1]
IndustrySME Digital Financing, Crowdfunding, Alternative Investment
FoundedFebruary 2015[1]
FounderKelvin Teo, Reynold Wijaya[2]
HeadquartersSingapore[1]
Area served
Singapore, Indonesia, Malaysia[3]
BrandsFunding Societies, Modalku
ServicesPeer-to-Peer Lending
Number of employees
150+
Websitewww.fundingsocieties.com

Funding Societies is a South-East-Asia based SME digital financing platform, headquartered in Singapore. It was the first such platform in Singapore to engage an escrow agency to independently and safely manage investors’ funds.[4] In Indonesia its known as Modalku (which means My Capital in Bahasa). The platform crossed S$ 1Bn in loans given out in 2019 making it the largest such platform in the region.

History

Kelvin Teo and Reynold Wijaya founded Funding Societies in 2015 while studying for their Master of Business Administration (MBA) at Harvard Business School.[2] Funding Societies operates an online platform that enables Small and Medium Business to seek funding for their growth from a pool of investors, through crowdfunding. The standard loan period ranges from 3 months to 1 year and borrowers can loan up to SGD$2,000,000. In the first month of launching, they received a total of SGD$3 million loan applications of which about SGD$250,000 was disbursed.[5]

In January 2016, Funding Societies launched Modalku, which means "My Capital" in Bahasa Indonesia to reach out to SMEs in the Indonesian Market.[6] The company claims that SGD$7.8 million in loans had been originated through its Singapore platform up to 30 June 2016.[7]

In February 2017, Funding Societies expanded its reach to Malaysia, starting Funding Societies Malaysia, headed by Wong Kah Meng, CEO of FSMY.

On the 19th of April 2018, Funding Societies have managed to maintain low default rates across the region, at 1.3% and disbursed more than US$110M in more than 3000 loans.

In November, 2019 they crossed S$ 1Bn in loans given out becoming the largest such platform in the region. They are also applying for the Singapore digital banking license with MAS.

Series A Funding

Funding Societies raised S$ 10 million in series A funding in August 2016 led by Sequoia India and Alpha JWC Ventures.[8]

Series B funding

In April 2018, just slightly over three years old, Funding Societies raised US$25 million in their Series B round of funding,[9] led by Softbank Ventures Korea, an early-stage venture capital arm of Softbank Group famous for its US$100 billion Vision Fund. Their existing investors Sequoia India, Alpha JWC Ventures (Indonesia) and Golden Gate Ventures together with new Venture Capitalists Qualgro and LINE Ventures also participated in this round.

Business model

Funding Societies provides borrowers an online application process by supplying details about themselves and the loans that they would like to request together with the required financial documents. The loans are unsecured and backed by personal guarantee of the owners of the business.

Funding Societies through their proprietary-scoring model, make credit decisions on the applications. Approved applications will be assigned a credit score based on their scoring model, which will determine the payable interest rate. The loans can be repaid at any time. Only Singapore or Indonesian registered businesses can apply for a loan on their respective platforms: Funding Societies for Singapore and Modalku for Indonesia.

Anyone can register as an investor to search and browse loan listings on website to select loans they want to invest into based on the profile of the borrower as provided through the factsheet. Investors can decide how much to fund each borrower, with the minimum investment at $100 per loan. Investors make money from interest and rates vary from 7%p.a to 14%p.a. Funding Societies makes money by charging borrowers an origination fee and investors a service fee.[10]

Partnerships

Funding Societies secured a partnership with DBS Bank in April 2016.[11]

Recognition

Funding Societies won the Tech in Asia road to Tokyo Tour (Singapore) Best Start-up award and represented Singapore in Tokyo in August 2015.[12] It has also been selected for the inaugural batch of participants to enrol in The SuperCharger FinTech Accelerator.[13] They were conferred amongst the Top 100 Fintech companies globally by KMPG and also the Brands for Good award in 2019.

See also

References

  1. ^ a b c d "FUNDING SOCIETIES PTE. LTD". SGP Business.com. Retrieved 13 January 2018.
  2. ^ a b "This lending platform was conceived in Boston but born in Singapore". Sbr.com.sg. Retrieved 14 November 2017.
  3. ^ Zieman (18 September 2017). "Peer lending for small businesses". The Star (Malaysia). Retrieved 13 January 2018.
  4. ^ "Funding Societies entrusts crowdfunding funds with MAS-registered Trustee". Cio-asia.com. Retrieved 14 November 2017.
  5. ^ "Peer-to-peer lending platforms seek new ways to increase investor confidence". Channelnewsasia.com. Retrieved 14 November 2017.
  6. ^ "Homegrown Start-Up Modalku Aims to Help SMEs With Crowdfunded Loans - Jakarta Globe". Jakartaglobe.beritasatu.com. Archived from the original on 8 October 2016. Retrieved 14 November 2017.
  7. ^ "Funding Societies". fundingsocieties.com. Retrieved 14 November 2017.
  8. ^ "Funding Societies raises S$10 million in Series A funding". The Asian Banker. 4 August 2016. Archived from the original on 13 January 2018. Retrieved 13 January 2018.
  9. ^ "Funding Societies, a Southeast Asian lending platform, gets $25M Series B led by Softbank Ventures Korea". TechCrunch. 17 April 2018. Retrieved 19 April 2018.
  10. ^ "Funding Societies to provide alternative financing to SMEs in SEA". Cio-asia.com. Retrieved 14 November 2017.
  11. ^ "Two Harvard Students Are Changing Lending in Southeast Asia". Bloomberg.com. 6 April 2016. Retrieved 14 November 2017.
  12. ^ "Tech in Asia - Connecting Asia's startup ecosystem". Techinasia.com. Retrieved 14 November 2017.
  13. ^ "Hong Kong's SuperCharger to help FinTech startups grow". Mis-asia.com. Retrieved 14 November 2017.
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