LendSecured Review – Solving the Problem of Agriculture Financing

In a recent episode on Mastermind.fm, I had the opportunity to interview Ņikita Gončars, the CEO and co-founder of LendSecured. This is one of the newest crowdlending platforms in Europe, however, it’s worth noting that it’s an offshoot of an existing lending business that has been operating successfully for several years.

LendSecured was started in 2019, when two experienced professionals from the secured lending sector Ņikita Gončars and Edgars Tālums became aware that there is a niche in the crowdlending market, as none of the existing market players offered low-LTV investment deals.

The core pillar and philosophy of LendSecured is to minimize risks, hence the name.

Many platforms might say the same, so how do LendSecured actually implement this philosophy? It all boils down to publishing investment projects with low LTV (Loan to Value ratio). The lower, the ratio, the lower the risk. As LendSecured also invests in each project, there is an extra incentive to do proper due diligence.

Unfortunately, many platforms these days only act as promoters, indiscriminately publishing many projects and letting the lenders take all the risks, not giving a care in the world whether projects make sense or whether the repayments will ever be made. I’m looking at you, Housers. Other platforms ended up being outright scams, like Envestio, Fast Invest, Monethera, Grupeer. I don’t see any such risk at all with LendSecured.

How stable is the platform?

The paid-up capital of LendSecured (company name Secured Finance MGMT) has reached EUR 100K. Upon starting operation, in order to rise the financial stability of the company, Secured Finance MGMT increased its share capital and now has also paid it up and registered the changes in the Commercial register of Latvia.

LendSecured has done a lot and continues to take steps towards making the platform as safe as possible. Currently, they continue to adapt the platform to the provisions of the new crowdfunding regulation and cooperate with the supervisory authority (FCMC) to be the first platform to receive the ECSP license in Latvia when the crowdfunding regulation becomes applicable in November, 2021.

It is also worth mentioning that investor funds are held separately, and LendSecured has relationships with Lemon Way and BNP Paribas for handling investor payments.

All projects are first rank mortgage, which is the most secure type of mortgage you can get. Other platforms offer second rank mortgages which are riskier, but can have higher interest rates.

The existing Latvia-only private secured lending business under the leadership of Ņikita and Edgars had bought its strategic investors a return of over 10%. They thus decided to launch the platform to expand publicly and internationally.

LendSecured benefits from a debt collection license (Loan MGMT Ltd.). Besides that, LendSecured is a member of the European Crowdfunding Network since 2020.

The team has considerable experience in Latvia and they want to expand to the rest of Europe, with Germany and Spain being one of the first big markets they are targeting.

LendSecured is going after the agricultural loans niche. There is currently a big gap between the financing needs of farmers in Eastern Europe and what’s available to them from banks and other lending providers.

The new product – seasonal funding for farmers with grain as collateral – will offer a possibility for investors to diversify their portfolio and invest in loans with added value to the whole EU economy. The financial gap in the EU agricultural sector is between EUR 7.06 billion and 18.6 billion, thus LendSecured’s goal is to narrow it down by offering farmers better access to funding.

Do they have good support?

Support is great, you can easily contact the team through their website. You can ask them about any of the projects they have available for funding and they’ll be happy to give any further information you need. Although I must say that every project comes with a section with all the relevant information nicely presented.

The website itself is professionally done, with good English being used throughout. I only found a few grammatical mistakes here and there which I’m sure they’ll polish off in the coming months as the platform grows.

I would recommend having a look at LendSecured as it might be one of the most innovative players in the space going forward. It’s worth mentioning that LendSecured also has skin-in-the-game for every project launched.

Invest with LendSecured