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My go-to platforms for investments into business loans are Envestio and Crowdestor. It’s now been more than 6 months that I placed my first investment there and taking a look back it was a good decision.

The first loans are being fully repaid now and within the next four weeks, eight projects are due for full repayment. So far, there has not been a single delayed payment for any of my investments. Naturally, the past is not a great indicator of the future but this tells me that the selection of investments projects (due diligence process) at Envestio and Crowdestor has been working well so far.

You can read more about the due diligence process here:

Envestio now offers an AutoInvest feature and Crowdestor announces new projects ahead of time which makes investing on these platforms more straightforward.

Key factors

My major reasons for getting into business loans were the following:

  • diversification into industrial and real estate projects
  • more careful selection process compared to consumer loans
  • much lower loan default rates
  • business loans always have a collateral which can be collected if the loan fails
  • relatively short loan durations
  • high return on investment

My return on investment is now stabilizing at around 17% p.a. which makes Envestio and Crowdestor by far the top performers in my portfolio.

interest rate Envestio, Crowdestor
Progression of interest rate of my Envestio and Crowdestor portfolios.
bubblechart August
My current return on investment (XIRR) on different p2p investment platforms.

Crowdestate is offering tons of real estate contruction and renovation projects which help to further diversity my portfolio. The performance in above chart looks pretty bad compared to the other platforms. That’s because many projects have bullet payments at the end of the loan term and the interest is paid in one single payment. So, by next year, my Crowdestate portfolio should also reach around 18% return on investment.

All in all, I’m getting stable returns from my business loans investments and will continue to keep about half of my portfolio in this investment type.

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