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Global Credit Investments raises $22.5m to finance OnDeck Australia’s small business loan book

22 Jun 2017
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Global Credit Investments (GCI) has successfully completed the latest round of financing of OnDeck Australia’s small business loan book by raising $22.5m from Australian high-net worth individuals and family offices.

GCI is an Australian-based specialist fixed income and credit investment manager founded by established investors Steven Sher and Gavin Solsky.

The financing has been completed via a special purpose bankruptcy remote structure with Perpetual as the trustee. The capital raise was significantly oversubscribed with strong investor demand attributed to the robust risk/return characteristics of the investment.

GCI Chair Steven Sher said the firm was pleased to help OnDeck realise its vision for third party funding.

“This arrangement ties into GCI’s strategy of delivering great risk return outcomes for investors,” Mr Sher said.

He said GCI continued to see further opportunities in the alternative credit sector given ongoing increases in bank regulation, improvements in technology and the availability of credit data.

“We’re finding a vibrant interest in alternative credit investments whereby investors are stepping in to fund Australian small businesses where the banks are not stepping up,” he said.

“Australian investors are looking beyond shares and real estate as a way to diversify their sources of returns – and as a result, high-net worth individuals are attracted to new models like OnDeck,” Mr Sher said.

OnDeck is a technology-enabled SME lender headquartered in the US that launched its Australian operations in April 2015. The company is focused on giving small businesses access to tailored, on-demand working capital solutions within one business day.

Further demonstrating its growth, OnDeck announced in May a partnership with the Franchise Council of Australia (FCA), the peak body for the franchise sector in Australia. By partnering with the FCA, OnDeck aims to reach the thriving $146 billion franchise sector as a supplier of choice for small business loans.

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