An innovative platform that could help thousands of financially frustrated first time buyer Millennials get on the property ladder has launched a bid for funds via crowdfunding site Seedrs.
StepLadder was launched in 2017 but is now seeking £125,000 from investors, valuing the company based on the equity on offer at £10 million.
It has recently reported a 40% growth in first time buyers applying to join as members this year and has already helped hundreds of people buy their first home.
StepLadder enables those first time buyers to join ‘circles’ whose other members put £400 to £500 into a pot of cash every month which is then awarded to its members via a random lottery system as a £10,000 lump sum.
The company recently launched its 100th circle, each one containing approximately 20 savers.
Founder Matt Addison (pictured above, right) says the system helps 90% of its members save up for a deposit quicker than if they squirrelled away the cash by themselves, apart from the 10% of those that do not.
His start-up is based on the concept of a Rotating Savings and Credit Association model or (ROSCA).
This is a group of first time buyer individuals or couples who agree to meet for a defined period in order to save and borrow together and, in effect creating a peer-to-peer lending group.
StepLadder is FCA regulated as a P2P platform and generates fees by receiving referral fees from lenders, solicitors, surveyors and other home buyer service providers, as well as a membership fee payable by savers.
It has already raised £90,000 of its £125,000 target which is on top of its existing £1.5 million start-up cash including money from the government’s Future Fund.