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ApplePie, a franchise peer-to-peer (P2P) lending platform, said on Tuesday it has increased the investor protection it offers with the launch of ApplePie Trust. The company has also secured close to $200 million financing via various mediums that it will use to fuel growth.
ApplePie Trust adds more protection
The new ApplePie Trust service is a Delaware statutory trust that serves as the new issuer of the platform’s franchise loan notes. All new franchise loan notes will be issued from the new trust with its protection conditions. Meanwhile, for existing loans notes will be re-issued by ApplePie Trust under the same terms they were initially signed.
The company has selected US banking organization Bankers Trust Company as the indenture trustee. The organization will act as an independent, third-party representative of noteholders and will make sure noteholders receive payments. In addition, Portfolio Financial Servicing Company will act as successor servicer, which will help ensure continuity of key loan servicing functions.
In case the P2P lending goes bankrupt, noteholders will still receive their payments since the ApplePie Trust has been structured as a “bankruptcy remote” special purpose entity.
New financing will ensure stronger market position
The P2P lending platform has as entered into a $180 million loan purchase agreement with TowerBrook Capital Partners, under which the equity firm will purchase franchise loans originated by ApplePie over a two-year period. In addition, the platform has raised $16.5 million in Series B financing round, co-led by QED Investors and Fifth Third Capital.
Thanks to the TowerBrook loan, ApplePie will be able to further strengthen its market position in the franchise P2P lending industry.
“The investments announced today will allow us to scale and dramatically advance our mission of transforming franchise finance, while providing TowerBrook with unprecedented access to high-quality credits in proven small businesses,” said Denise Thomas, ApplePie CEO and co-founder.
ApplePie Capital, set up in 2014 and launched the P2P lending platform in early 2015, specializes in facilitating franchise entrepreneurs, both new and existing ones, to finance their businesses with loans starting from $100,000. Individual and institutional investors alike can earn attractive fixed-income returns with established franchise brands and earn returns of 7%-12% on their investment.
The platform has helped the financing of more than $50 million in loans to more than 40 franchise brands. The company has returned over $7 million in principal and interest to investors.
ApplePie is one of the top US P2P2 lending platforms.