Credit squeeze leads to personal lending opportunity for start-up Assetline

Not many start-ups can say they’ve secured a heavy hitter such as DealsDirect co-founder Paul Greenberg as an advisor, but that’s just one of the things Assetline has achieved since it was founded last year.


Based in Sydney, Assetline is an online personal asset lending platform. It was founded by Nick Raphaely and Steven Beinart, who have more than 35 years of experience between them.


Raphaely talks to StartupSmart about why Australia is an ideal market for the personal asset lending model, and how Assetline intends to attract customers.


What is your background and how did it prompt you to launch Assetline?


I have 15 years of investment banking and funds management experience in the UK and Australia.


I began my career at Merrill Lynch International, providing corporate finance and investment banking services to corporate clients.


I subsequently co-founded the Ashton Group, a privately-owned investment management group focused on alternative investment, with offices in Sydney and London.


Steven has over 20 years of international senior management and board experience in the facility services, healthcare and personal care industries.


In 1996, Steven founded the Ecowize Group, a specialist outsourced services group, which today operates in the USA, Australia, New Zealand and in South Africa.


The group employs approximately 3500 personnel on three continents, servicing global blue chip corporate customers.


Steven holds numerous directorships in private and listed companies including the Ecowize Group, Ecofirst and Heritage Brands Limited.


The Assetline model is propelled by two powerful, converging trends. Firstly, tightening bank credit. Since the GFC, bank lending has tightened considerably and it is much tougher for Australians to get bank credit.


Secondly, pervasive access to internet through fixed line or handheld devices. This enables Assetline to distribute its service very broadly via a confidential and discreet online platform.


We believe that Australia has ideal attributes for the personal asset lending model to succeed:


  • Asset-rich population.
  • Population primarily concentrated in three cities on the eastern seaboard.
  • Australia has one of the highest levels of personal debt in the world.
  • Post 2008, bank credit has tightened significantly.
  • Australia Post’s national infrastructure supports Assetline’s operations.
  • High level of internet penetration, with government commitment to increase this further.


What does the business offer consumers they can’t get elsewhere?


Borrowers who need short-term liquidity fast have limited options.


They can either sell an asset (which takes time, involves transaction costs and the asset is gone forever) or seek bank credit (credit and income checks are needed and availability is uncertain).


Whether for personal or business use, Assetline provides a fast, effective and discreet service for borrowers where traditional forms of credit are otherwise unavailable.


With Assetline, no income or credit checks are needed and funds can be advanced within as little as 24 hours.


Assetline lends from $1000 to $1 million against assets traditionally overlooked by mainstream banks: luxury watches, jewellery, diamonds, precious stones, gold and precious metals, fine art and antiques, motor cars and fine wine collections.


We’re the only player in Australia to provide loans of this scale secured against high-end valuables.


How did you fund the business and what were your start-up costs?


Assetline has been funded by a syndicate of private shareholders. The start-up costs were approximately $250,000 (excluding loan capital).


From past experience, we recognise that systems are essential to scale a business. We have invested heavily in this area, which we believe will set us apart from the competition.


How many staff do you have?


Assetline has three full-time staff but our services are augmented by a wide panel of valuation experts, carefully selected to assist Assetline in valuing our clients’ assets.


We have also done a deal with Australia Post to provide logistics for our operation.


In January, Paul Greenberg joined the Assetline advisory board. Paul co-founded the DealsDirect Group in 2004, which he grew to become the largest online department store in Australia.


We’ve thus been able to create a wide footprint while keeping fixed costs low, which is essential in any start-up business.


How do you promote the business?


We have used a combination of PR and direct marketing.


Although we’ve only been going for a few weeks, we’ve already been featured in some key mainstream media such as The Australian and have appeared on TV (on Sky Business News).


We’ve also featured in several trade publications, for example Australian Broker Magazine. We have further coverage in the pipeline, which will be coming out over the next few months.


We have a fresh, innovative and exciting story to tell and we’ve found the media to be very receptive.


For direct marketing, we’ve led with internet marketing so far. We have a TV commercial running at the end of April and also have plans to target print media in other key channels.


We’re currently planning a competition for later in the year – very exciting and innovative – designed to attract a lot of potential customers to the Assetline brand.


What are your revenue projections for 2012/13?


Our revenue is closely linked to our marketing spend. Because we are not only a new business but also pioneering a new industry, we need to create customer education and awareness around what we offer.


What revenue we generate will be directly linked to how aggressively we choose to market. This means our revenue projections will be linked to how quickly we choose to grow the business.


What has been your greatest challenge and how did you overcome it?


The biggest challenge for Assetline is that we are breaking new ground in Australia.


While the Assetline model has been successfully implemented in the UK and US, we are the very first to offer online personal asset lending in this country.


This has meant that there’s been no clear model to follow in terms of things like logistics and legislation.


Having said that, there’s something very exciting about being the leader and the trailblazer. We believe there is a great advantage to being first to market in Australia.


What is the biggest risk you face?


We need to educate the market that a facility exists for customers to borrow using their high-end valuables as security.


Australians have accumulated a vast array of valuable assets, but most would never have considered that they could use them as collateral for a short-term loan.


I’d classify this more as a challenge than a risk. We need to make the market at large aware that we exist as a compelling alternative for a short-term loan.


Is there anything you would have done differently?


Having both started businesses ourselves prior to establishing Assetline, we are under no illusions as to the challenges in getting a new business going.


I think we both realise that persistence, determined effort and patience are needed to establish a new business. Having said that, we’re very pleased with the early signs that we’ve seen.


Perhaps the only thing we may have done differently would have been to launch sooner than we did, however, we wanted to make sure our processes and systems were properly bedded down first.


In hindsight, we think this was probably the right move.


How has the lending environment changed in the last few years?


Bank lending has become much tighter and customers have to cut through much more red tape than before to get loans.


As mentioned above, this was one of the key factors that motivated us to explore the personal asset lending model as an alternative for customers who want fast, flexible solutions.


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