Crowd2Fund | 2 years on platform review

On the 17th June 2021, I passed the milestone of having been an active investor on Crowd2Fund for 2 full years.

If you are thinking of joining Crowd2Fund then this article sums up my personal experiences on the platform, how it has evolved and where I think it is going.

Note: This article is not sponsored, but does contain referral links.


What is Crowd2Fund?

If you are not familiar with the premise of Crowd2Fund. It is simple. Crowd2Fund is a online platform that matches business owners who require business funding with small volume, peer-to-peer investors. There is no prototype for a Crowd2Fund business or their financing needs. Business owners can be seeking startup capital, growth capital or just debt consolidation funding. With the businesses themselves coming from a multitude difference sectors – from IT to architects, hairdressers, retailers and more – from every corner of the UK. The secret sauce is in how Crowd2Fund manages those opportunities.

Fully regulated by the Financial Conduct Authority (FCA), Crowd2Fund operates on tight due diligence principles. The simple truth is that is Crowd2Fund gives out bad loans, they and their reputation will falter. It is important to realise that Crowd2Fund is not like a savings bank. They are a true investment platform in that there are no cast-iron guarantees that you cannot lose money. This means that through Crowd2Fund you can take greater risks while they in turn can be more flexible with the guarantees and opportunities that underpin those risks. As investor, these risks are clearly presented to you via the web portal so that you are always clear on how you are positioning your own assets.

New investors should be very clear however that unlike a high street bank. Their services are not backed by the Financial Services Compensation Scheme (FSCS) which protects up to £85,000 of deposits and so it is up to you to invest wisely.

Note: If you want to find out more about the basics of Crowd2Fund, have a look at my 6 month review article which covers the ins and outs of the platform in more detail.


Your role as an investor

As an investor, your role is to offer fractional % loans to businesses. Unlike with a traditional bank, the Crowd2Fund model is designed to encourage you – and all investors – to make multiple, free ‘micro loans’ to multiple companies. Investment commitments can be as low as £100 and up to the full stated value sought by the business – or anything in between.

By utilising the micro-loan strategy, you avoid placing all of your money into one company. This reduces the chance of any one company defaulting on their commitments to repay you. When spread out over 10’s or more different companies this means that the proportional individual risk to you as an investor is far, far reduced compared to a loan from a traditional bank.

All you have to do consider what companies you want to invest in. Make the investment. Then simply wait a month for the contracts to be issued. After which you can sit back and start watching the micro-repayments start rolling in. As soon as your balance reaches £100 again, you can re-invest in a new opportunity.

Crowd2Fund encourages you to maximise your long-term investment growth by ensuring that you re-invest as soon as possible; although you can save up a larger, uninvested cash pot on the platform if you prefer.

Investment opportunities range from APR’s of between 8% and 15%, with the average in my experience being around 11.5%. Most loans are amortised (paid back) over between 24 and 36 months, meaning that you will receive an average of 11.5% each year for 2-3 years against the slowly reducing principal amount.

Tip: Don’t forget that the company will be gradually paying back the loan, so the amount that they pay 11.5% on will slowly reduce!



Let’s cut to the chase. What you really want to know is did I make any money, right?

The answer is a resounding: yes!

UK Financial Year Profit Losses
2019 – 2020 10.34% £0.00
2020 – 2021 11.54% £0.00*
2021 – 2022 (to June 17th) 2.21% £0.00

These numbers are my calculations from my own investment data. Crowd2Fund list my holistic returns performance as 12.92% against a platform average of 10.99%.

My smallest loan was for £48 (purchased in the Exchange) and the largest £820. The average investment across my 11 companies comes in at £248.08. Offering you an idea of the micro-loan spread.

Charges are taken at the point a loan repayment is made every month. In the absence of a report outlining this, I laboriously totalled up my entire charges history which came to £13.48 since 17th June 2019 or ~£6.74 per-year.

Over all, I have been very happy with the service offered by Crowd2Fund, the software platform and the returns. A friend who invested in Ratesetter at around the same time and has not realised the same levels of return or investment security that I have via Crowd2Fund. She then experienced several problems and excuses from them for reducing her holdings, to the extent that she pulled out of peer-to-peer completely back in April.

So what is my strategy? Research the companies you are interested in. Ask questions. Invest and then sit back and wait. It really is that simple.


My Process

Crowd2Fund’s due diligence processes appear to be pretty robust. Their 3.86% write-off rate is higher than it was when I started due to the current economy. This is also higher than the current 0.7% corporate loan write-off rate experienced by the banks1. Yet I have been heartened through observing the number of companies who return to the platform after completing a successful funding round to take out a new loan – and you had better believe that they get snapped up quickly when they do!

With that said, I do my own homework:

  1. I always try to ask the director(s) at least one question: often a leading one! I see this as a way of gauging how serious they are taking the process.
  2. Look up their data on Companies House.
  3. Check their brand reputation through simple online searches. Look at Google and Trust Pilot ratings and check message boards.
  4. Look at their website. Check that it is up to par and looks like a business that I would consider doing business with.

These are simple steps that do not take long, but I marry it with my personal #1 rule: I only invest in businesses that I understand.

This makes me picky. It often means that at times there has been a balance in my account that Crowd2Fund have been pretty agitated for me to invest. Yet for me, investing in businesses that I understand helps me to feel more confident about my investments. Thus far, with my above 10% returns, I remain comfortable in my decision making.

1 “Forecasted share of business/corporate loan write-offs in the United Kingdom (UK) from 2018 to 2023”, accessed 24 June 2021


The hanging *: The 2020 Experience

The eagle eyed amongst you will have noticed the * at the end of my 2020 – 2021 loss figures.

It is true, I haven’t lost anything. Yet Crowd2Fund were not spared from the pandemic. In fact, they still haven’t fully recovered. With that said, the platform survived through the Covid crisis with incredible resilience. Its write-off rate is still reasonable, at 3.86% and its up-front efforts in due diligence, securing guarantees and in being readily able to respond to the crisis with more flexibility than afforded to the banks, has put it on a good footing for 2021.

On paper though, I have a 4.03% default rate across my Crowd2Fund portfolio. This came from 2 companies. Of course, when their status changed to show they were in arrears, it made my 2020 experience that little bit more tense. In practice due to the micro-loan nature of the platform the total risk to me was sub £200.



One of Crowd2Fund’s first reactions to the Covid-19 crisis was to suspend trading on its “exchange” – a market place for investors to prematurely sell out of loans. This locked all funding into position, preventing investors from leaving and in turn a run on their balance sheet that would have de-valued their loan book.

At the same time, Crowd2Fund also terminated all new loan application requests. These two acts all but halted their operations in Spring 2020, with the exception being that they continued to process loan repayments on behalf of investors. So, without any choice, I, like all other investors continued to receive repayments. It was just a question of how soon and how many would start to see defaults.

Both of mine came in the autumn. Both were dealt with quickly and both were put under extension arrangements by Crowd2Fund. In practice, this means that while my repayments calendar shows 2 months of missed payments. They are under an agreement to pay-up the missing months either by advancing repayments during the remainder of their loan or to pay them through additional instalments afterwards.

Consequently, either through skill or through luck. I have no actual losses expected on any of my investments.

Unfortunately, even as of writing in June 2021. The ‘exchange’ market place is still closed, preventing any investor from selling-out of the platform before all of their loans have been naturally repaid. Neither has there been any correspondence from Crowd2Fund over when this will reopen. Fortunately though, I am happy to remain on the platform, yet this did mean that I was unable to buy any debt during 2020. This means that I accumulated more than 50% of my portfolio value back as cash that I was unable to re-invest until Crowd2Fund started issuing loans again in the Spring of 2021.


Two Year Reflections

How does Croed2Fund stack up? In my 6 month review I offered levied constructive criticism towards the platform. Principal of which was the low number of opportunities available during my first 6 months.

This criticism still applies, however they have been hit hard by the Covid crisis and are having to start-up almost from scratch under some particularly tough economic conditions. I see the slow pace of loan authorisations as necessary to ensure quality on their loan book – and safety for investors. So patience while you wait for the right opportunities for you needs to apply.

Many of the user interface points that I raised in my first review have been actioned. The ‘Account’ section is now more logical although the use of percentage figures can still sometimes be little bit wayward, lacking explanation or even arbitrary. While the UI itself is still missing some of the very basic data that I would like to see both holistically (such as a total charges summary) and on a per-investment basis. Finally, the platform does now automatically log you off from time to time – but not every 20 minutes like a bank does. More like once every 2 weeks.

One of the additions that Crowd2Fund made during 2020 was the inclusion of their risk assessment quiz. The quiz is now a mandatory part of holding or opening any account on the platform. If you are not sure whether peer-to-peer lending is for you. I would encourage you to start the process of opening an account and to take the test. If you understand all of the questions and can answer them correctly, then you will have no problem on the platform. If you cannot, or feel intimidated by the answers then it is okay to be honest with yourself and accept that peer-to-peer lending is not for you.

Most disappointingly, there is still no Android app for the platform and no real sense of there being a Crowd2Fund community – either in terms of discussions with other investors / the Crowd2Fund team, nor with the idea of having feedback from company owners on their progress or successes that the investment community has played a part in. Both of which I maintain would be welcome additions.



Overall, I have been very happy with my Crowd2Fund experience. 2020 was a difficult year and the Crowd2Fund team rose to the opportunity to prove that they have a formula that works. I do not see Innovative Finance ISA’s as being the “wild west” of retail investing and could easily be something that a far, far greater percentage of investors should look into.

Yes, it is a risk. You have to be aware of that. Yet what better way is there to participate in our own domestic community? In the small businesses that we hope will one day become a medium-sized and then large, global businesses of the future. Crowd2Fund lets you contribute to a business that is more than a faceless statistic. You can contribute to British businesses, bypassing the “old world” that is the banking system while actually participating in the betterment of local communities across the country.

I am optimistic that Crowd2Fund has opened up a very promising, low-cost line of investment, separate from the stock market which requires less up-front knowledge and less research when compared to stock picking. Someone with £100 to invest can benefit from up to a 15% annual return and in 2021, this is something that we are never likely to see from a high Street bank.

Provided that you understand and accept the risks, it is within the power of any potential investor to grow their money through constructive and community positive means via this platform.

I have had a positive experience and I can and do encourage others to take a look for themselves.

For more information on Crowd2Fund or to create a free account on the platform please visit