In the 5th episode of the ‘Do you speak crowdlending?’ podcast, Tobias Angehrn shares his perspectives on crowdlending as an alternative funding medium for SMEs. Although this episode was recorded at the beginning of 2020, his experiences and insights from the crowdlending industry are still relevant today!
Tobias has gathered over 12 years of experience from the banking industry. He started with an apprenticeship at Raiffeisen Schweiz before moving on to Credit Suisse as an assistant vice-president. Owing to his fascination with entrepreneurship at a young age, eventually, his true passion led to his shift to the fintech sector. First, with Advanon before ultimately establishing his own company, Finwize.ch. Remarkably, Tobias is also currently the crowdfunding ambassador for Crowdify and the general director at Tresio.
Read the summary of his intriguing podcast below!
What was Tobias’s motivation behind the dive into the crowdfunding and crowdlending industry?
Tobias first came across the concept of crowdlending in 2008. A few years later, crowdlending started to gain momentum in Switzerland, and that is when he knew that he needed to be a part of this pivotal change in the financial industry. Moreover, during his time in the banking sector, Tobias primarily dealt with accountants and CFOs, but not particularly with business owners. He felt like he did not have much direct impact and wanted to “move more and move faster”, which led him to the crowdlending industry.
How does the fintech industry differ from the corporate world?
There are various noticeable distinctions between the two. For Tobias, in fintech, the most significant difference was the pace of businesses. He observed that the input of every individual could noticeably shift the direction of a company. The speed in the corporate world is considerably slower. Additionally, in the corporate world, facilities and infrastructure already exist. In a start-up, you often have to build everything from scratch, and very often, there are no processes in place if you want to experiment with something new.
“With crowdlending, you can also invest in small or large amounts and directly make a real impact on those companies.”
What are the advantages of crowdlending from an investor’s perspective?
The two main advantages are diversification and impact. Crowdlending is an entirely new asset class, with a low correlation to other asset classes. From a portfolio theory point of view, you can really diversify with crowdlending. With crowdlending, you can also invest in small or large amounts and directly make a real impact on those companies.
What is Finwize? Tobias’s role in this company and Tresio, his new passion project.
Finwize is a digital financial assistant for SMEs and is currently active in three business fields, 1) financial consulting, 2) consultation on loan acquisition through alternative ways of financing 3) Tresio — a cash flow planning tool for SMEs.
Tobias is currently the general director at Tresio. In his opinion, in Switzerland, the lack of cash flow is still one of the biggest causes of downfall for companies. He believes that Tresio can be a tool to help ease this issue for SMEs.
Why is Tobias so driven towards helping SMEs on their journey?
Tobias likes to surround himself with those who are passionate about SMEs and entrepreneurship. With SMEs, he believes that you can provide value directly to the businesses and create an impact. It also allows you to interact directly with the decision-makers and gain insights into their mindsets. For him, this is truly inspiring and a fantastic learning opportunity.
“Crowdlending platforms are usually very flexible and swift in decision-making, and companies should take advantage of that.”
What would Tobias advice be for SMEs on financing?
Firstly, it is crucial to evaluate your situation and have a thorough understanding of your financial stand. Explore the various types of financing and how much it makes sense to you. Often, business owners seek financial aid without knowing what kind of loan they need or what they will do with the money. If you ought to get a loan, you should calculate how much it will cost you (including the interest) and how much value you can obtain from it.
Secondly, seek out the available options. Nowadays, there exist various exciting and innovative ways to finance a company, especially with crowdlending. Crowdlending platforms are usually very flexible and swift in decision-making, and companies should take advantage of that.
Lastly, read the small print. SME owners may sometimes overlook the little details. They may think they are taking a loan with a 1% interest rate per annum without realising collateral attached to it. Evaluate and assess the risks. Perhaps in some cases, it might be more favourable to have an unsecured loan and pay a higher interest rate, but not have to risk losing your fixed asset in case your business faces financial difficulties.
What is the difference between crowdfunding and crowdlending?
According to Tobias, crowdfunding is reward-based, whereas crowdlending — you get your money back with interest. With crowdfunding, you help a business realise its idea by contributing money towards that project. In return, you receive some rewards — a product or a service, without getting your money back.
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