Asset-Based Crowdfunding

The majority of invoice backed crowdfunding investments carry a very low risk

Crowdfunding is generally considered a risky investments but one type of this relatively new form of lending is practically risk free. Asset-based finance allows small to mid sized businesses to borrow against their unpaid invoices through the power of crowdfunding. Businesses receive 80 to 90 percent of the amount of the invoice from investors on the crowdfunding platform. Investors then receive their Return on Investment (ROI) in the relatively short period of 45 days on average.

At present, Platform Black and Market Invoice are the two leading organizations in the area of invoice crowdfunding. Investors in the platforms are carefully screened; they include money managers, asset managers, family offices, high net worth investors and hedge funds. Both Platform Black and Market Invoice require an initial minimum investment of £50,000 to open an account. The interest rates on the short-term loan vary and depend on the competition among investors, who bid on the platform, and the perceived risk of the business receiving the funds.

The average ROI is very high – 11 to 20 percent per year, with monthly interest rates that range between 1.2 percent and 1.8 percent for both platforms. Investors pay 10 percent of their profit as a fee to Platform Black and 20 percent of any gain made to Market Invoice. Neither firm charges any fee to set up the account or service fees and taxes on profits depend on the tax profile of each individual.

As part of the process, businesses undergo a thorough risk check. Platform Black uses Experian, a credit-checking firm, to provide real-time credit ratings on businesses for investors on their platform. The real risk is less than the rating would reflect though. Anil Stocker, founder of Market Invoice explains, “The Market Invoice product is lower-risk because investors are funding invoices issued by small businesses but to be paid by large blue chip end customers (large private companies, publicly quoted multinational businesses, Government entities). Effectively an investor is pre-funding a payment from a large company, which has a very low chance of defaulting.”


Bocchino & Donato Corporation ( is a Worldwide Commercial Business to Business Debt Collection Agency. We are your full service debt collection solution. We handle NSF checks as well as Commercial Accounts for all our clients worldwide.

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