When we started our new series of interviews in the beginning of 2020, we definitely didn’t expect so many changes in the crowdinvesting business in so little time… Changes that have experienced most of the platforms and that in some cases have helped them to adapt to the new context and evolve the service and investment proposal they offer to us.
Today we interview Pavel Klema, the brand new CEO of Bondster, a P2P marketplace which in these months is earning the praise of many investors for its great recovery work with overdue loan originators while still offering one of the highest average net returns of the whole industry nowadays.
1 – Hello Pavel, and welcome to TodoCrowdlending.com! First of all, for all those readers still not familiar with our platform, can you briefly tell us what Bondster is and what your unique investment proposal is for all users interested in joining the marketplace?
Hello Jesus. So, for the investors not yet familiar with our platform, Bondster is a P2P platform located in the Czech Republic. It was stated in 2017 and since that time it has been gaining a lot of publicity both on the Czech market as well markets abroad.
As for the unique investment proposal, the first are the vast diversification opportunities. Diversification goes geographically e.g., through regions (because we operate in 4 continents), or through security options, you can get. On our platform, you can invest in loans secured by real estate, gold, and other movables, or in loans offering a buyback guarantee, which our loan originators provide for most investment options. All these instruments eliminate the risk for our investors.
Also related to the security of investments, our Risk Department does a great job with the due diligence process. Any new potential loan provider is a subject to a deep analysis, monitoring, and thorough assessment.
To me, it is the unique combination of security and high yields, which makes Bondster attractive to investors. As of now, our data shows that the overall interest we paid to our investors is 14.9 %, which is an incredibly competitive number.
Some other advantages I can mention:
- Investing from 5 euros,
- The secondary market which will be launched in next few months
2 – I see you have vast experience in Banking, Finance, and Risk Management, including your last position as CEO of Profi Credit, one of the top non-financial loan providers in the Czech Republic, all of which seems to be very relevant and very well fit for being the CEO of Bondster… What do you think are the main values/qualities you are bringing to Bondster and where do you see the company in the next few years?
I think I can build on a combination of many aspects. From managing people (I was managing 250+ employees) to my goal-focused leadership behavior approach. Although the Czech market in the non-banking financial sector is a quite challenging place, in 2019, at my previous job position, we broke a company record in year´s production.
So, I believe, that this combination of my experience on the financial markets and the results-driven mentality is something I can bring to Bondster as an added value.
And to your question about where I see Bondster in the next few years:
Bondster is in the phase of a fintech start-up, from which it should rise very rapidly and dynamically. This trend of rising, whereas in the number of investors and assets under management following with investors´ satisfaction is a benchmark and the main KPI for me.
Bondster in the past was rapidly expanding, when I see the numbers from 2018 to 2019 I see that the growth of the company was simply stunning. Then the pandemic came and brought with it a bit of stagnation. My goal then, for this and next year, is to bring the growth back where it was before COVID-19.
3 – One of the areas where Bondster seems to have been very successful in the last few months is the management of overdue loans and problematic loan originators, with quite a few investors praising the work done, being much more successful than other competitors in the same situation. Can you tell us more about this ’back stage’ work? What is behind being successful in such situations?
Firstly, I have to appreciate the work of my predecessors as the success at the early stages of the pandemic was their work as I was not part of the team yet. The success from my point of view goes hand in hand with the fact that we were ready. We immediately adapted to the given situation. Negotiations with impacted loan originators were initiated straight away. Our mindset was focused on reaching win-win types of agreements where both the investors and loan originators would benefit. Equally importantly, we always had a plan B (and this was already my job, given the fact that I have approx. 10 years of experience with collection). We opened a dialogue with external debt collecting companies in Poland. We were 100% ready to overtake those debts and to start collecting them even during the negotiating time with the providers. So, on one hand, we were negotiating the settlement agreement and on the other, we were working on a backup solution in case the agreement was nowhere to reach.
Right now, more than 50 % of the debts are already covered and back with our investors without transferring any collection costs to them. We expect in 2021 to have all liabilities settled, except for 2 companies that are currently under insolvency procedures in Poland and one other company where the money is not coming as fast as expected.
To conclude, being ready is what I believe brought us such good results.
4 – Let’s talk a bit about the immediate future… What are the main goals for Bondster under Pavel’s management in this challenging 2021?
A full focus on restarting growth, as mentioned earlier. I think that people after the pandemic are seeking security, during the pandemic they started to realize where risk is, what are the consequences of the pandemic, and right now, they want to make an informed decision on what to invest in what are the risk related with this investment. Currently, we have conducted a customer survey and 52% of our Czech investors and 68% of our foreign investors expect growth in the P2P market, and the same percentage also stated they will raise their portfolio within Bondster and P2P investments.
As a customer-centric company, we will do our best to keep high yields for our clients. For us, it means to get Bondster back on track with the pre-pandemic figures. One of the tools how to do so is through new investment opportunities that will be offered on our platform. Also, this year we want to start massively acquiring foreign markets, not just the Czech one. Although we are already present on some foreign markets we want to grow more and invest in some promotions to make us more visible and known to European investors.
2021: Other goals, secondary market, that will be launched in next few months.
The long-term goal is to have our own app.
5 – According to our monthly stats report you are currently offering one of the best average annual return rates in the whole industry, with returns close to 15% for investments in euros… Are you trying to position Bondster as a reliable, well-diversified high-yield platform? Is this the niche you are planning to dominate in the coming years?
Yes, that is exactly how we wish to be perceived by investors. A trustworthy, reliable, and stable platform with high yields and strong risk management. I think it is the success of the loan originators we have acquired on one side and the work of our Risk Department. Because we are setting the exposition limit, each loan originator is starting with an exposure limit and in the time, we see how they are proving their liability and liquidity. Then we either lift the exposure limits up or down, should we determine some risk. We have loan originators with high-interest rates and thus high revenues for our investors, where we are also trying to manage the risk.
We are always working to keep this advantage on the market, this is probably the answer. We wish to keep this advantage in the future.
6 – Shifting gears, as we all know, in the coming months the new European crowdfunding regulation is going to provide a legal framework to all P2P lending players… How is Bondster planning to adapt to this new context, and what can we expect as investors of the platform?
As an ethical and credible player, Bondster will welcome any legislation that will regulate the operation of the platforms. For Bondster this regulation would mean gaining an even higher reputation. As a result, I dare to say, a new stream of traditionally conservative investors will be more attracted in P2P investing. Also, I believe that the coming regulation will mean that only serious and stable “players” will remain at the market.
7 – Thanks for all the information shared so far, Pavel, would you like to mention or comment on anything else to our TodoCrowdlending.com community?
I would just like to say big thanks for your interest in our platform. I am very happy that you like what we are doing, what my team is doing, and I hope that we will all smoothly overcome these pandemic times and go back to our normal lives.
Also, we are very pleased that the number of Spanish investors on our platform is increasing. Thus, we have decided to create a Spanish version of our web application to make investing for them even easier. We hope they will appreciate it 😊.
Muchas gracias a todos nuestros inversores españoles, realmente apreciamos que hayan decidido invertir en nuestra plataforma Bondster. Agradecemos enormemente a Jesús, por su tiempo y gran oportunidad de hablar con sus seguidores. ¡Sigamos adelante! 😊
Great. Thanks for your time, muchas gracias a ti por tu tiempo, Pavel! 🙂