After the Covid-19 induced decline that started in March 2020, Mintos saw the growth to recovery towards the end of 2020 and closed the year with €10.2 million in revenue, €1.6 billion in loans funded, and investors’ interest earnings of €53.3 million. Mintos credits consistent communication and investor loyalty as the key drivers of its quick resurgence.
Mintos, Europe’s leading alternative investment platform for investing in loans, released its consolidated audited financial report for the year 2020 – along with a number of insights about lessons learned and what investors can expect in the near future.
2020 in retrospect: from caution to steady growth
January and February, 2020 were the best months in the history of Mintos with a record volume of loans funded, and new investors joining the platform. However, with the outbreak of the COVID-19 pandemic in March, the industry conditions changed quickly, and so did Mintos’ objectives. “We swiftly switched our focus from expansion and growth to ensuring business continuity and operational sustainability as we set out to endure the macro-economic recession,” said Mintos CEO and co-founder Martins Sulte.
At the onset of the COVID-19 pandemic, many existing investors decided to abruptly halt or reduce their investing activity while they waited for a clearer economic outlook. Furthermore, the global downturn in 2020 led to a sharp increase in underperforming loans, many of which eventually ended up delinquent. Mintos was quick to react by creating and expanding teams within the company dedicated to loan recovery.
Despite these challenges, over 80% of the total funded portfolio sustained their strong performance and delivered a total €53.3 million in interest earnings to investors. This shows a significant increase of 18.9% when compared to the €45 million earned in 2019.
In 2020, 128,380 new users joined Mintos, bringing the platform to a total number of 369,332 investors from 105 countries. And with an addition of €1.6 billion in loans funded in 2020, the cumulative volume of funded loans grew by 37.2% to reach €5.9 billion.
Lessons learned: communication and support tools to investors
“Looking back, our agile approach helped us make progress even in the turbulent economic landscape of 2020, “said Mr. Sulte. “Over the last year, we developed and implemented many projects, edging closer to our vision of making investing in loans as common as investing in other popular assets like stocks or real estate.”
Mintos was able to surpass a number of hurdles that it encountered in 2020 by strategically focusing on improving its operations from the investor point of view. As such, the company prioritized consistent communication with investors by intensifying efforts to enhance transparent reporting.
As many of the company’s associated risks materialized in 2020, Mintos increased their commitment to protecting investors being exposed to unacceptable risk levels. Among other things, the company built supporting tools for risk assessment such as the Mintos Risk Score, the Suitability and Appropriateness Assessment for investors, while also working on similar initiatives to increase investors’ risk awareness.
Achievements: service improvements & fundraising success
Despite market ups and downs, the Mintos team focused on continuous service improvements. In January a new lending companies evaluation model was introduced – Mintos Risk Score. A month later the company launched the Mintos mobile app. Throughout the year a lot of time and effort was invested into user experience improvements, including the creation of learning materials about investment strategies. At the end of 2020, the company launched a crowdfunding campaign, raising over €6.55 million Euros, which was the largest crowdfunding amount ever raised on the Crowdcube platform in the European Union. Quite notably, Mintos ended the year with the AltFi’s “People’s Choice Award 2020” for the fifth consecutive year, evidence of its strong and loyal community.
Looking ahead, Mintos is highly optimistic because investment rates are once again gaining momentum. Looking at the numbers from Q1 for 2021, the volume of loans funded has already grown by 26%. This depicts a gradual return of investors’ confidence.
Mintos is steadily approaching a significant milestone of becoming a regulated platform. The company expects to acquire licenses to operate as an Investment Firm as well as an Electronic Money Institution shortly. The company sees these moves as important steps towards bringing investment in loans to the mainstream.
You can find the Mintos Consolidated Annual Financial report for the year 2020 on Mintos website. Please note that this report is an audited Consolidated annual report. Shareholders will have an opportunity to approve this report in the meeting scheduled later in June 2021.