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UK WINNER - GEOFF MILLER
DEAL: Platform Black raises £2m investment from GLI Finance
NAME: Geoff Miller COMPANY: GLI Finance Limited (GLIF) EMAIL: info@glifinance.com
Deal Maker of the Year Awards 2013
BIO
Geoff Miller spent twenty years in the UK financial services industry, as an analyst and as a fund manager, focusing particularly on the specialty finance, asset management, insurance and investment company sub- sectors. He moved offshore in 2007, initially to Moscow, then Singapore and now being resident in Guernsey.
In 2009 he was asked by shareholders to join the Board of what was then T2 Income Fund Limited, now GLI Finance Limited (GLIF), to assist in stabilising the business and establishing whether value could be rebuilt, the company having lost 96% of its value in the wake of the financial crisis. Four years on, and having seen a more than 1500% total return to shareholders, the management is seeking to build GLIF into a leading provider of secured finance to small and medium sized corporates. Its model is to develop a series of partnerships with exceptional management teams of businesses with sustainable competitive advantage in complementary areas of SME funding. For these businesses it provides capital to help build the business and to invest across their various platforms. The company aims to produce a mid-teens ROE for its shareholders across the business cycle.
In addition to leading the executive team at GLIF, Geoff sits as an independent director on a number of boards of financial and investment companies, including GLIF’s investee companies, BMS Finance, FundingKnight, Platform Black, IFDC and Lombardia Capital Partners.
Outside of the financial sector, Geoff helped found Word Play Limited, an independent mobile app development studio that has recently introduced its first app, Wordstop. He also invests in a range of other early stage, mainly technology, businesses.
DEAL OVERVIEW Q
Please summarise the transaction
In September GLIF invested £2m in the crowd- funding platform, Platform Black Limited. The investment was in the form of ordinary and preference shares, in return for which GLIF will own at least a 20% stake in the business. Platform Black is an online platform for crowd-funding invoice finance. The platform enables SMEs to get access to the money tied up in their invoices by auctioning them online to investors seeking attractive short-term returns.
Platform Black delivers cashflow on demand on a pay as you go basis. SMEs auction their invoices, remaining in control of all of the costs, to investors who compete to deliver the lowest cost of finance. Platform Black has advanced c. £30m to SMEs to
that, based on what we felt were the range of likely scenarios for the company’s growth, would take it through to profitability. Assessing that quantum and how then to structure the ordinary/preference share split was the greatest challenge.
A great deal of qualitative and quantitative analysis.
Q Q
How does the transaction fit in with your overall business strategy
The investment was a perfect fit within our strategy of focusing on niche lending to SMEs and enables us to add short-term asset-based finance to our portfolio. We were delighted that Colin Levins, Louise Beaumont and their team at Platform Black chose to partner with us, and GLIF now looks forward to building on this investment by trading on the platform, as well as investing in the business.
Q
date, and delivered double digit returns to investors. Platform Black’s service is entirely complementary with that of the banks and asset based lenders.
Q Q What was your role within the transaction
As the CEO of GLIF, I personally negotiated the terms of the deal, based closely on our investment into online SME lending platform FundingKnight, which we completed a month earlier. In both cases I joined the Board as part of the transaction.
What were the challenges or difficulties presented
Our methodology, in making the investment, was to provide the company with sufficient resources
Q
What are your thoughts and predictions within your sector for 2014 and beyond
Every day we see further news of the squeeze that is being put on SMEs in the UK and throughout Europe as the banks retrench. We believe that smart companies will increasingly consider alternative forms of financing offering better terms and conditions than the major banks are able or willing to provide. New platforms are emerging every day and there will be opportunities for GLIF to extend its range of partnerships during 2014.
What are your plans following the transaction
The strategy for GLI Finance is to focus on secured lending to small and medium sized enterprises and diversify that lending across geographies and types of business through investment in a range of partnerships with a variety of different platforms.
How were the challenges or difficulties overcome