Your 5 minutes with… the Credit Assessment Team
So far in this series, we’ve spent some time with members of two key areas of the Funding Circle team: the customer relations team and the insolvency team. Now it’s the turn of the team who make informed decisions about the loans you invest in: the credit assessment team.
The team has grown steadily over the past 3 and a half years, with Kevin starting in May 2010 (before Funding Circle had even launched) growing to 8 members today, who share over 80 years of experience between them within the credit and risk underwriting industries.
Day-to-day activities include:
Assessing applications from potential borrowers who come to Funding Circle for a business loan. This includes reading biographies of where a business is, where it has come from, and where it wants to be in years to come. With that information, coupled with our our in-house assessment model and external sources of data, the credit assessment team can then work out how we could help them get to where they want to be. As well as this, they have regular catch ups with the credit analytics team, including Andrew Mullinger (co-founder and Head of Credit) to update and refine our credit model, to identify trends and raise any suggestions or comments.
So let’s get a feel of who the team are and where they’ve come from… Can you all tell me a bit about your backgrounds?
Kevin: Sure, as you mentioned, I was the first employee at Funding Circle. We had no website, no credit scoring models, no procedures, nothing! I have over 17 years’ Credit Underwriting experience working for various banks and finance companies.
Craig: I joined in May 2013, having 5 years’ credit underwriting and deal structuring experience. I’ve done quite a range of underwriting including property and shipping finance.
Penny: I only joined last November, but have 15 year’s experience and an asset finance background at ING.
Duncan: I became part of the team in August 2012, having 12 year’s experience in credit underwriting; specifically in agriculture and construction finance.
Jas: I joined pretty early on in February 2012. Before this, I had 10 years in risk underwriting and was previously at ING.
Ari: I actually knew Jas from ING, and focused on asset finance. In total, I’ve probably got around 15 years experience too.
Louisa: I joined a bit before you Ari, wasn’t I? February 2013 I think. I have 5 years’ credit underwriting experience, in leasing and asset finance.
Sandy: I started last month and previously worked as a trade credit underwriter for 2 and a half years, having come from Sydney where I worked as a mortgage insurance underwriter.
So it seems you all have a variety of backgrounds, and many years of experience! Do you think that helps with the decision making here?
Kevin: It definitely helps. Our team have a wide variety of experience, gained across several areas and while we do seek opinions from others, we try to ensure that all underwriters review applications across the whole spectrum.
Penny: It helps, yes. If you’re not 100% sure of something, then nobody has a problem with you passing it on or asking for some input. We all work together, and because of the range of businesses that come through to Funding Circle, it’s great that everyone is accessible.
And what would you say the common goal for the team is?
Kevin: I’d say it’s really to acquire well measured risk in a fair, prudent and accountable manner.
Craig: We’re guardians of peoples savings but we’re also investing in the future of businesses. Overall, I’d say we’re here to lend as much money as we can, in a sustainable and responsible way.
Duncan: Yes, and we hope to change people’s lives for the better.
Louisa: Definitely. We want to encourage the right type of business and protect investors’ money.
Yeah, it’s definitely important to reach that balance. So why did you decide to work at Funding Circle?
Duncan: I wasn’t happy at my old job. A recruiter called me, so I met Andrew and immediately I was sold! I joined when the company was a lot smaller and the business hadn’t massively taken off, but Andrew completely sold it for me.
Kevin: It sounds a bit sycophantic, but as soon as I met the three co-founders, I knew that Funding Circle would be a success (remember I joined before we launched). Looks like I was right!
Sandy: I think the concept of peer-to-peer lending is brilliant. Funding Circle has a platform which is able to provide a win win situation for both borrowers and investors, and we’re the industry leaders which is even better!
Craig: I wanted to work at a company where people liked working and people believe in what we do. I think a lot of the negativity in finance comes from legacy issues, like what happened in 2008 for example, whereas we don’t have the legacy issues here, and we love having our name in the newspaper!
Louisa: I wanted a change and thought this would be a great opportunity to grow with a company, and without sounding too clichéd I thought it looked very exciting!
Do you think any of our processes differ to other institutions you’ve worked at?
Kevin: I helped to design some of our processes, so there are similarities with others I have experienced. I think the biggest difference is that we are not risking our own money, but that of our investors, so we have to be extra vigilant.
Duncan: Our speed sets us apart I think. Other places take 6 weeks to make a decisions, where as we can get a decision out within 48 hours which is incredible for businesses, and also brings plenty of lending opportunities to investors.
Ari: I’d say the process has a general look and feel of everywhere else that I’ve been, but there are some improvements that can be made which we’re working on.
Jas: There’s not a lot different, the systems weren’t in place when I joined but we’re getting there. Generally I’d say we’re fairly inline with industry standard.
You must have seen hundreds, if not thousands of applications now. Has anything surprised you about the types of businesses that come to us?
Louisa: Not really surprising, but the average business tends to be well established; having weathered the last 5 or 6 years.
Ari: They are the “S” in “SME!” Usually husband and wife teams, generally asking for about £70k.
Penny: I’d call them lifestyle businesses. I used to see a lot of the same deals coming through in my previous company, but here – anything goes!
Sandy: Exactly. They’re typically SME family lifestyle businesses, so you know that they have a vested interest in making their business work, which provides some comfort when looking at their applications.
Craig: For me I think it’s the cross-section of businesses that we see, I mean it really could be anything.
Duncan: Anything could come through the door, from high street shops, to newsagents, to filmmakers, to hot tub manufacturers.. The list is endless.
Kevin: Not really. I have been doing this for a long time, and have seen many strange things.
That sounds interesting! Go on..
Kevin: We had an application where the company bought some land somewhere in Africa for £10,000 but had revalued it at £57 million in the accounts.
You’re right, something does sound amiss there. What’s your favourite thing about working at Funding Circle?
Jas: For me, it’s the people, everyone is really genuine.
Penny: I agree, it’s a nice place to come in to. They’ve also been very flexible with my childcare needs. Everyone is accessible and is happy to hear from you.
Ari: It’s also the people for me, it’s a great place to work, you don’t get the blues about waking up in the morning and we’re in early and stay late.
Craig: People are happy to be here. I don’t rush home at 6pm, I’m happy to continue working.
Kevin: I love the buzz and the energy. The people are generally young and vibrant, and being the oldest employee, I find it is infectious.
Louisa: Yeah, there’s a real positivity everywhere. We’re all excited about where the company is going.
Sandy: The dynamic and fresh culture. The people at Funding Circle are such a cool bunch and are really friendly.
Duncan: It’s nice to work somewhere where you are valued and the staff do matter. Everyone has a voice.
And what would you say the hardest part of your job is?
Ari: I love working here but the hours can be long.
Jas: Leaving work on a Friday afternoon!
Kevin: I think it’s remembering everybody’s name. We are growing so fast that I lose touch.
Craig: Trying to predict the volume that’s going to come in as it’s moving so quickly. Also, dealing with businesses who we’ve rejected is pretty tough, as rejection is always going to be taken personally.
Penny: I’d say seeing businesses, or their applications, that are just not quite there yet. You want to help them but you always have to remember that investor’s money is at risk. So I guess finding that balance is tough.
Louisa: You can sympathise with the company which really does need financial help, but we just can’t get them there.
So aside from Funding Circle, what other interests or hobbies do you have?
Louisa: I love doing anything outdoors, like running and hiking. And I enjoy going out in London with friends.
Penny: Looking after (and running after) my 5 year old son!
Duncan: I really enjoy cooking.
Sandy: I enjoy boxing and yoga.
Kevin: I love football, and played for many years at various levels, but now it’s confined to watching from my armchair.
Jas: At the moment, its managing an ongoing and overrun building project: my house. We started 10 months ago and it’s still not finished!
Oh no, I’m sure a lot of people can sympathise with that one. Thank you all for your time, I know you’re all keen to get back to reviewing loans so let’s finish with this one. Do you have any interesting facts that you wouldn’t mind sharing with us all?
Penny: I’m really scared of heights but I managed a bungee jump. I don’t think I’d do it again, as I’m sure I fainted at the top.
Duncan: I nearly became a chef and instead opted for underwriting.
Craig: I can juggle wine bottles.
Kevin: I did have an almost encyclopedic knowledge of 1970’s pop chart music.
Jas: Ari and I were once in a TV advert. It was for the National Lottery and there were some hilarious hairstyles going on.
Ari: Yes, we were. And Jas showed everyone the clip before I had even joined. Thanks Jas!
Excellent, I’m sure we can dig out that clip if enough people want to see it. And Duncan, why don’t you start a Funding Circle “Bake Off”, I’m sure there would be plenty of eager participants.
We’ll be spending our next 5 minutes with the credit analytics team, so stay tuned for our next installment.