Flow (crowdland site)

Company

Financial services, investments and auditing
Since 2018
Russia

Owners:
Alfa Bank Russia - 19%
Moscow Exchange (MICEX-RTS)

Content

2021
- Moscow Exchange bought a stake in the Stream service
- Alfa Bank sold 41% of the Stream platform
2020: Launch service for all physical and legal entities
Notes

Owners

+ Alfa Bank Russia

+ Central Bank of the Russian Federation

+ Government of the Russian Federation

+ Sinara Group

+ Sinara Bank (formerly SKB Bank)

+ Softline Projects

+ Fundament Capital Investment Management

+ European Bank for Reconstruction and Development (EBRD)

2021

Moscow Exchange bought a stake in the Stream service

On September 15, 2021, the Moscow Exchange announced the acquisition of a stake in the Stream investment platform. It is planned to close the deal within three and a half months. The financial and other terms of the agreement are not disclosed.

Artem Zheleznov, Managing Director for Strategy and International Presence of the Moscow Exchange, noted that the partnership with the Potok platform will allow the exchange to participate in the organization of new financing tools for small businesses throughout Russia. Such companies, developing their processes, scaling their business, building corporate governance, will be ready to enter the public capital market in the future. Another interest of the Mosbirzhi in the deal is that to expand the line of investment products through highly profitable instruments for private investors on the Finuservy personal finance platform, Zheleznov said.

Moscow Exchange acquired a stake in the Stream service

In turn, the managing partner of Potok, Yuri Popov, said that cooperation with the Moscow Exchange will allow the company to accelerate growth in the small business financing market.

Thanks to our cooperation, we will be able to offer advanced fintech solutions to a wider range of customers - both small businesses looking for new sources of financing, and investors, private and institutional, who are interested in the opportunities to diversify their portfolios through new high-yield tools, "he stressed.

By mid-September 2021, the Potok platform has 13 thousand investors who have financed over 6 thousand small businesses worth more than 12 billion rubles. In the first half of 2021, about 900 million rubles of loans were issued through the Potok platform, which is more than three times higher than the same period in 2020.^[1]

Alfa Bank sold 41% of the Stream platform

On April 8, 2021, it became known that Alfa Bank's stake in Potok Digital was reduced from 60% to 19%. The deal was concluded with Potok Holding, to which the bank first sold 40% of the startup, and now 41%.

The fact that Alfa Bank has 19% of the crowdland platform Potok left, the Kommersant newspaper wrote, citing data from the SPARK-Interfax system.

Further, it is better to develop the platform separately from the bank in order to have a wider diversification of the portfolio and build independent partnerships with other banks and non-financial companies, "explained Alexey Chukhlov, chief financial officer of Alfa Bank.

Alfa-Bank sold 41% of the Potok platform to Potok Holding

He noted that "Stream" was launched as a technological project, which was brought to operational profit.

Yuri Popov added that "the active development of the project at the next stages requires independence from the parent bank."

Market participants believe that Alfa Bank was forced to withdraw from the project. Crowd investments in Russia were ineffective, one of its market sources told the publication. For most investors, the total return is at the OFZ level with incomparably higher risks and time losses. And on the scale of Alfa Bank, it simply does not make sense to do this business, he said.

The second interlocutor added that the quality of the portfolio of small and medium-sized businesses (SMEs) is in question, and coupled with expectations of defaults in 2021, the bank's exit from the project seems logical.

At the same time crowd funding , obstacles remain for development in Russia, said financial sector KPMG CIS Natalia Rakova, head of consulting services for companies in Russia. According to her, in the country "an insufficient number of SMEs with good credit potential, which are ready to take loans at such sites."^[2]

2020: Launch service for all physical and legal entities

In early February 2020, the Potok crowdland site, 60% of which belongs to Alfa Bank, announced a restart, within which it became available to all interested legal entities and individuals, as well as individual entrepreneurs.

Flow now allows you to invest from an account with any bank. Previously, the service worked only with Alfa Bank.

The Alfa Bank-owned platform for lending to companies has become available to all individuals and legal entities

Another update is the transition of the site to the use of a special nominal account. This is a key requirement of 259-FZ on the activities of investment platforms, which entered into force on January 1, 2020.

The nominal account will allow Potok to additionally protect investors' funds. In fact, such an account excludes misuse of funds and seizure in connection with platform obligations, separating investor funds from site funds. "Stream," according to the company, was one of the first in the crowdlanding market to implement such a solution.

The updated platform also improved investment diversification: investor funds are automatically distributed to at least 25 borrowing companies, which significantly reduces the risk of losses. In the future, Potok plans to develop an auto-investment mechanism so that the portfolio of an active investor consists of at least 100 borrowers.

During the existence of the Stream, its investors issued by the beginning of February 2020 more than 10 thousand loans to small and medium-sized businesses in the amount of more than 8 billion rubles. The actual average annual yield of investors on loans issued from June 2018 to May 2019 (i.e., on loans for which by February 2020. maturity) increased to 17% (before taxes, taking into account losses on defaults) due to improvements and automation in IT algorithms of scoring and collection.^[3]

Notes

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