On the 31st of October, we, the October Nederland team in the Amsterdam office, are celebrating our 1st year anniversary. Exactly one year ago, we received the news from the Dutch Authority for the Financial Markets that our application to become a Dutch lending platform had been approved. This means that today we are officially 1 year active on the Dutch market. And with our name, October, this month is of course a little bit ‘our month’.
Simplifying and democratising fundings
Entrepreneurs regularly experience financing as a barrier to growth. The process for obtaining it is often complex and in-transparent. Our goal is to establish a European platform where SME entrepreneurs can easily apply for a loan. This loan is financed by both institutional and retail investors. The use of technology makes us hugely client-oriented: an SME can receive financing of up to €3.5 million within one week.
We not only distinguish ourselves from banks, we are also different than other non-bank financiers. Our financing by institutional investors allows us to rapidly finance a company and facilitates certainty of funding to the entrepreneur. The co-financing by the crowd requires us to have simple and transparent communication. And that has a positive impact on our client interaction and our own culture.
Promising launch in The Netherlands
After the recent celebration of the fifth anniversary of October in France, the step to the Dutch market also appears to be the right one:
- Since our launch, we have financed more than 30 projects from SME’s with a total amount of over €15 million, resulting in a top 10 position among crowdfunding platforms in The Netherlands.
- Several advisors have embraced our proposition and share our name and platform with their clients. A recent consecutive financing for an entrepreneur and his advisor is a great compliment for us. It shows that we are adding value to Dutch SMEs.
- Investments of 40.000 to almost 1.5 million euros were financed by thousands of retail lenders in combination with professional investors such as pension funds and insurers.
Challenging projects of leading companies
In the Netherlands, crowdfunding is increasingly becoming an accepted way of financing. Unlike the banks, October offers financing without collateral or a personal guarantee, and we do that very quickly! Whether it is about the relocation to a new office building for Optima Data, the development of new products by Nomenta or the international expansion of Active Cues; October supports leading companies in their ‘Moments of Life’. And we also do this at times that are not obvious. For example, we helped the owner of UW-S with a takeover, where the financing had to be completed within a week. And thanks to our investors, we raised this financing during Christmas 2018.
Democratising funding for SMEs…and for every Dutchman
But we’re not there yet; crowdfunding in The Netherlands (and all over Europe) has its challenges. The acceptance among SMEs is still in development and for many people lending money to these companies is quite thrilling. At the same time, crowdlending is seen as a serious alternative to broaden the financing landscape. The European Commission is working hard on crowdlending regulations that will further professionalise the sector. And in the Netherlands crowdlending is also seen as a serious alternative : the SME Financing Foundation was set up with the help of the Ministry of Economic Affairs and Climate; and the parliament recently asked the government to apply the green investment scheme to alternative forms of financing as well. This would be a huge boost to consumer involvement in SMEs!
On a journey of discovery with clients and investors
After having worked in the banking sector for more than 20 years, working in a start-up environment is a welcome change. The DNA in a start-up gives an incredible amount of energy. So what is that DNA like? Here are a few characteristics of how we deal with the client and with each other at October:
- Continuous transparency: A perfect relationship with the client requires that you are transparent about your decisions and that you believe in what you are contributing to. We help SMEs grow and the way we do that, being through crowd-lending, makes the work tangible and meaningful, and, if we do our job well, excellent performance. Moreover, we put our money where our mouth is (or practice what we preach) with senior management investing in every loan on our platform.
- Making mistakes is allowed, not learning from your mistakes is unacceptable: A prerequisite for the ultimate client focus is a safe environment in which people can make mistakes. This includes the courage to openly share these mistakes. To learn from them and thus improve the client experience.
- Independent thinking: With data and feedback from the client, we continuously evaluate our performance to improve the client experience and increase scalability. This process never stops; and requires an open mindset, high commitment and accessibility.
- Enjoy the journey: We are on a journey of discovery. This is an important reason for many employees to choose us. When you work with us you contribute to the whole; learning together, having fun and enjoying the adventure are requirements for being and staying motivated. And that is reflected in delivering the best results.
The client’s expectations grow along with this. He or she wants direct, personal and real-time answers. And that is possible, with our technology as the ultimate enabler of our services. We are therefore proud to be nominated for the Next40.
We aim for the greatest success for everyone and with everyone!
Success is not just about realising financing. Our dream goes much further. We are only really successful when we provide the best service to all parties involved; entrepreneurs, their advisors, and investors (retail or institutional).
And for us, the best service means not only financing at a fair price, but also minimising defaults. Making sure that we only finance companies that use this financing successfully and thus achieve growth. In doing so, we share our knowledge with the companies we finance. With the aim of reducing the risk for our retail investors, optimising the track record with professional investors, and providing ‘hassle-free financing’ for SMEs. This combination ensures success for the Dutch and even European society.
Let me start by thanking the companies, investors and advisors. They have shown confidence and courage by being the first to use our platform.
In the coming years we will continue to finance attractive Dutch and European companies. That means hard work with a focus on an ever better ‘experience’. We have carefully attuned our interests to them and focus on the long term. Our focus on technology goes hand in hand with a focus on the people and companies on our platform to give meaning to the funding. Our transparency leads to equal treatment of all interests and is, in our view, the best way to build trust, remove barriers to financing and benefit together.
CEO October Nederland