Irish P2P lender Linked Finance raises €2m as it looks to expand

Peer-to-peer (P2P) lender Linked Finance, which is seeking to become the biggest non-bank lender to SMEs in Ireland, has raised €2 million in equity funding.

The funding round was led by the company's original venture capital backers Frontline Ventures. In addition, 28 individual investors who are all active lenders on Linked Finance's platform, participated in the round.

Founder Peter O'Mahony established Linked Finance in 2013 when he raised €350,000 from family and friends, along with €200,000 from Enterprise Ireland. The company enables small companies and sole traders to raise between €5,000 and €250,000 via its platform.

Linked Finance said it plans to use the funds raised to support ambitious expansion plans. The company intends to establish P2P lending as a mainstay of the SME lending landscape in Ireland; replicating the type of success that this innovative form of funding has already seen in other markets, most particularly in the US and the UK.

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Since it was established in early 2013, the company has lent over €34.5 million to SMEs, with more than €14.2 million already repaid to lenders.

The company, which recently appointed former Ryanair deputy chief executive Michael Cawley as its chairman, last month completed its 1,000th loan.

"It is fantastic that we have been able to practice what we preach, harnessing the power of the crowd to open this investment round to some of our most active users. These lenders are people who know the platform inside out, they know what it's like to lend on the site and they really believe in what we do. It's great to have them on board, and also to have the continuing support of Frontline Ventures," said chief executive Niall Dorrian.

Linked Finance, which recorded its biggest quarter in the history of the platform in the first three months of 2017, reported a €1.2 million net loss last year as its liabilities rose from €600,000 to €1.8 million.