October relies on a unique investment model to offer companies financing up to 5.000.000€.
Two types of lenders
There are two types of October lenders:
- Retail lenders, just like you, who lend between €20 and €2.000 to the projects of their choice.
- Institutional investors (asset managers, private banks, family offices, insurers, professional investors), who are committed to lend to all projects through the October Fund or the October Italy Fund.
The October investment Fund automatically finances 51% of the loan amount of every project that is presented on the platform. The other 49% is offered to retail lenders for a defined period of time. If they do not fully finance the remaining 49%, the fund completes the remain loan amount to 100%. Thereby the borrower is guaranteed to receive the money they request as a loan.
Some Italian projects can be co-financed by the October Italy Fund. The intervention of this Fund allows a reduction in the overall average cost of financing for the company, leaving the return for private lenders and institutional investors of the October Fund unchanged.
The retail lenders
The retail lenders lend on the platform for mainly 3 reasons: to diversify their portfolio, to improve the rate of return on their savings and to support the real economy.
As of 2019, the community of retail lenders on October currently counts more than 55,000 people, from all over the world. Over 20,000 are active lenders, because they have lent to at least 1 project. On average, these lenders lent €95 per project and have a portfolio of €3.500.
The best compliment for us is to be recommended. So far, a quarter of the retail lenders who registered on October came recommended by a friend already active on the platform and we are grateful for it. And you, do you want to spread the word?
The investors of the October Fund
- Public institutional investors: their mission is to facilitate access to fundings for SMEs. The European Investment Fund is our main institutional investors.
- Private institutional investors: insurance companies, banks, family offices or high net worth individuals (HNWI) also take part in the fund. They invest in business projects to diversify their assets and improve their yield. Wormser Frères Bank, Decaux Frères Investissement and Groupama are among our first supports for example.
- October managers: they invest automatically in all the projects published on October without choosing the amount lent to each project to align their interest with yours and those of the Investors of the fund.
The investors of the October Italy Fund
- Italian public and private institutional investors: through their investment in the October Italy Fund, they enable Italian SMEs to access cheaper credit. The Italy Fund was initially subscribed by some of the main Italian Confidi (Consorzio di garanzia collettiva dei fidi, Italian consortia providing guarantees to facilitate access to credit) with the support of the European Investment Fund.
Our funds are restricted to professional investors looking at investing at least 100.000€ in the October Fund. If you would like more information about the criteria to be considered professional investors, please reach out to our Institutional Relations team at [email protected].
What are the advantages of this hybrid investment model?
- 100% of the projects published on October have been financed: for the companies, it means that there is no risk of reputation or of not achieving 100% of the required financing.
- 100% of the money lent by the investors has been used: there is no risk that their funds will be immobilised without purpose during the subscription period since the collection will be completed.