Samir Desai steps down as director of Funding Circle
Funding Circle Holdings PLC Updates
Sign up for myFT Daily Digest to be the first to hear about Funding Circle Holdings PLC news.
Samir Desai, founding managing director of corporate lender Funding Circle, will step down at the end of the year, the company said Thursday.
Funding Circle announced the move alongside first-half results which showed the company’s second half-year profit, and Desai said he was leaving with the company “in the strongest position it has ever been” .
He will be replaced by Lisa Jacobs, a longtime executive of Funding Circle who runs its main business in the UK.
Desai founded Funding Circle in 2009, providing online loans to small businesses that struggled to borrow from traditional banks after the financial crisis. He was the last of Funding Circle’s three co-founders involved in its day-to-day operations, but will remain a non-executive director after his release.
“As founder, board member and shareholder, I remain fully committed to Funding Circle,” he said. “I am incredibly excited about our future growth opportunities and look forward to supporting Lisa and the team in my new role. “
Funding Circle has had a bumpy ride since becoming the first of Britain’s post-crisis major fintechs to go public in 2018. The listed company has a valuation of around £ 1.5bn, but at its nadir in 2020, its market value is less than £ 100million. was less than the amount of cash shown on its balance sheet.
However, it has rebounded in the past year, as its involvement in government coronavirus rescue loan programs in the United States and the United Kingdom has helped it achieve profitability. The company reported a pre-tax profit of £ 35million in the first half of 2021, compared to a loss of £ 115million in the same period last year. Revenue soared 19% to £ 121million.
Funding Circle said the performance was better than expected, but warned the second half would be weaker as it distracted attention from government-backed programs.
The company said adjusted profit before interest, taxes, depreciation and amortization, its preferred measure of profitability, would be in the “single-digit millions” in the second half, up from £ 53million in the first six months of the year.
For the latest fintech news and opinions from FT’s correspondent network around the world, sign up for our weekly newsletter #fintechFT
While government programs have largely ended, Funding Circle hopes to benefit from a long-term structural shift towards online lending in the wake of the pandemic. It is also expanding into more everyday payment products after spending most of its history focusing on larger loans between £ 10,000 and £ 500,000. Last week it announced a “buy now, pay later” service for businesses, and it also plans to introduce a credit card.
Jacobs said the new services “represent the next step in our mission to solve more financing problems for small businesses.”