Alternative finance firm which launched £50m Midlands fund to be wound up
An alternative finance fund that just three years ago revealed plans to inject £50m into Midlands businesses is set to be wound up.
This move follows Growth Street’s initiation of a Resolution Event last month, whereby its current loan book will be recalled from borrowers and existing P2P investors will be reimbursed their investments in at least quarterly instalments. Any possible losses will be spread across the investor base.
Growth Street says its “entire focus” will now be on supporting its borrowers to find alternative sources of finance while ensuring that funds are returned to its investors.
Kim Goetzke, COO at Growth Street, said: “It is with deep regret that we have taken the decision to begin a solvent wind down of the business once the Resolution Event is complete. This is not a decision which we have taken lightly. We believe passionately in Growth Street as a business and we will make every effort to ensure that the impact to our investors and our borrowers is minimal. Our team will continue to work tirelessly to return funds to our investors.
“The onset of COVID-19 presented numerous challenges for our business. We worked hard to find solutions which would allow us to emerge from the Resolution Event a stronger, more competitive business but unfortunately, we weren’t able to get there.
“We assessed all of our realistic options, including having discussions with our shareholders and other institutions to find a solution that would enable us to build an economically viable business going forward whilst allowing us to offer a market leading proposition for our customers. Unfortunately, it wasn’t possible in the current environment to put together the package of equity investment and institutional funding necessary to continue the business.
“A core team will remain with the business to effect a controlled, solvent wind down, supporting borrowers and investors and to realise value from its technology. To those leaving the business, we will help you in every way we can.”
In April 2019, Growth Street appointed Samantha Fray as a dedicated business development manager for the East Midlands, but she left in November of last year after just seven months in the post.