Rent reporting service CreditLadder has launched a bid on crowdfunding platform Seedrs to raise £600,000 which values the business at £6.5 million, it is claimed.
The company launched nearly three years ago and has been seed-funded to date by both private investors and £600,000 won from HM Treasury during a competitive funding pitch last year.
CreditLadder’s Seedrs campaign, which is offering 8.45% of the company’s equity, is part of a wider money-raising round that it hopes will realise £2 million from both the crowd-funding platform and existing and new private investors.
The platform is part of a burgeoning sector that is growing as several companies exploit Open Banking technology to offer tenants a free rent reporting service to help improve their credit rating.
CreditLadder recently gained FCA approval for its processes, has reported rent payments totalling over £70 million so far and says it has deals with estate agents to offer its service via ‘several thousand’ branches.
Experian, which CreditLadder works with, recently claimed that approximately 80% of tenants would improve their credit score if they enabled their rent payments to be recognised by the credit referencing agency.
“CreditLadder can be an important part in moving tenants form renting properties to owning them, “ says Mark Jones, CEO of PP Asset Management, which was an early investor in the platform. “We see a big commercial opportunity in this change.”
Sheraz Dar, CEO of CreditLadder (left), says: “Landlords and agents can benefit because they are always interested in tenants who are prepared to pay their rent on time.
“Lenders also benefit because when they are making lending decisions the missing piece in the jigsaw at the moment is the rent paid information which is not readily available. That’s something we offer in conjunction with Exprian.”
Dar says the money raised will be used to strengthen the team, build out its product and fund marketing activity.