I recently had the opportunity of speaking with Paul Aitken, Founder and CEO of Borro – A company launched 3 years ago, Borro is the leading personal asset lender in the UK, and launched in the US earlier this month.
In our interview below, Paul shares his story starting Borro and advices for aspiring entrepreneurs.
Can you give you some background information about yourself, were you the entrepreneurial type growing up?
I live and was brought up in Oxford and I had no idea what I wanted to do until I was one year into my first job after University.
My father has always created new ideas for products, and was involved in the early stages of borro.
Tell me how the idea for borro came about?
In my dreams. I thought it was illogical that people did not use their personal assets as security for a loan, when selling a personal asset if you need liquidity is a well-used option.
What is borro?
borro is the leading personal asset lender in the UK, and launched in the US in February 2012. borro has created a new category of lending by providing loans of £1,000 – £1,000,000 secured against personal assets including jewellery, luxury watches, gold, fine art, antiques, prestige cars, yachts, fine wine and other high value assets.
Talk me through the first few months of running the business? What would you say was the hardest part of starting the business?
The first few months, we of course focused on building trust with the customer as well as customer acquisition- both of which were and still are challenges.
How were you able to fund the business?
The business is backed by investors which include Augmentum Capital, European Founders Fund and Eden Ventures, Octopus Investments. These companies have invested in LinkedIn, We7, Betfair, Egg, Sportingbet, Facebook, and more.
Would you say the initial idea for the company, or that your business model has changed since its launch in 2008?
Yes. The range of assets we lend against has evolved to include fine wine, fine art and prestige and classic cars. We are also serving a higher end clientele than initially envisioned.
How big is your team now?
We currently have over 50 people in the company across London and New York.
What would you say has been some of the most crucial things that you've done to build the company to this level now?
Creating a new category of lending. There are plenty of examples of very successful businesses that have legitimised a market that previously had a ‘grey’ reputation - Betfair, eBay, Seatwave, Sportingbet to name a few.
Also, in the last year we have had tremendous success working with IFA’s, Wealth Managers, Tax Advisers and Accountants who refer business to us. To them we are a new form of bridging finance, and through this channel we recently completed our first £1m loan secured against a fine art collection.
What is your business model?
Our centralised business model allows us to provide loans of up to £1,000,000 secured against personal assets. Loans can be completed online or through appointments at our Central London valuation centre, home visits, and various premium collection options including same day couriers. All these services are fully insured and provided for by borro.
Is the business profitable?
Our focus at this stage is on growth both in the UK and internationally.
You’ve been very successful in raising investments, why? What advice could you give to start-ups looking to raise finance for their businesses?
My previous experience in selling my previous company Movota to Bertelsmann certainly helped open doors. But the simple truth is that right from the start we had to show evidence of progress daily. I would advise owners of start-ups to do the same as well as have a well-run business with excellent processes and systems that will allow them to provide a world class service, and effectively manage their risk.
What idea do you regret not starting in your early years as an entrepreneur?
My view is that I should have taken the plunge of starting my own companies earlier than I did. Part of the reason was not having enough confidence to back myself. Likewise, at the time I was looking at doing start-ups in the late 90s, there was far less capital for start-ups than there is now.
I had lots of ideas – in 1999, for example, I had everything fleshed out for a precursor to Facebook, but I never got it off the ground. I spent too much time planning and not enough time doing.
You made a successful exit in 2005 from a mobile phone connectivity company, you could have easily sat back and enjoyed your money, why start another company?
Movota did well and the investors got a good return but I certainly didn’t make enough money to retire! Irrespective I enjoy what I do - creating new things and working with good people.
Do you think other entrepreneurs need to do this for the UK to have a growing ecosystem of successful entrepreneurs and investors?
I learned that, if you’ve got a good idea, you should back your judgement and go for it. Don’t theorise – just get on with it.
What would you say has been some of the key things you’ve learnt so far as an entrepreneur?
I really believe you don’t know how something will work out until you try it. I also think it is important to have the confidence to change the path you are following, if you need to.
What’s been your most memorable moment so far on your entrepreneurial journey?
Starting borro and winning Alternative Lender at the Credit Today awards in 2011, just two years after we started lending.
What pieces of advices could you give to aspiring entrepreneurs out there?
I think it is important to have a broad network of people whose opinion you trust on a variety of different matters. These people evolve over time. Over the years I have talked regularly to my first boss, Rob Sirs the MD of RM plc., a great friend of mine Mike Tilbury a senior partner at Graphite Capital, Yoav Leitersdorf my co-founder at Movota, and my father. With borro I see the non-Executive board members as fulfilling the mentor role also.
What can we be expecting from you and borro in 2012?
We are on plan for borro to be the UK’s largest provider of loans against personal assets by 2014. This year we will continue scaling up our international business.
Where do you want the company to be in five years?
In 5 years we will be the global leading personal asset lender with operations in 10 or more countries.