We chat to Nicholas Harding, CEO P2P lending platform Lending Works. Nicholas tells us how he has created an amazing customer experience and how the UK is a great environment for SME growth.
Please explain who you are, what your business is, and what it does/aims to achieve?
I’m someone who is passionate about making financial services better for people. Having studied Computer Sciences at University, I then spent 8 years working in financial services including 5 years at RBS, before founding Lending Works in 2012. Lending Works is the leading disrupter in providing finance and loans to consumers through partnerships. We fund our loans via our P2P platform which enables savvy investors to lend their money directly to creditworthy borrowers. We launched in January 2014, and have since facilitated over £100m worth of loans. Unlike a bank or other intermediary, we do not absorb any margins in between. Instead, the borrower simply pays off the loan received from the consumer lender at an agreed rate of interest. We perform the complex processes to make this work for both sets of customers, such as assessing the borrower’s creditworthiness and ensuring that the process is completed smoothly for all parties (for which we charge a small arrangement fee). As a company, our vision is to pioneer fair financial that people love.
What time does your day usually start and end?
Although our official opening hours are 9-5:30, my day starts a whole lot earlier with two young children! I’ll usually be up from 5:30am attending to them, before cracking on with work. I commute into the office from Hertfordshire each day, so I usually get home at around 6:30-7pm. But my day doesn’t end there – between spending time with the family and often logging back on to work at night, I seldom get to bed much before 11pm.
What is your favourite part of your job and what is your least favourite part?
So many wonderful aspects of my job to choose from – working with a great team, the array of exciting and innovative projects to choose from and seeing a business idea transform from a concept to a fully functioning, fully breathing being. Yet I would say the thing I enjoy most is the effect Lending Works has on its customers. It makes me incredibly proud to know that we have positively impacted over 20,000 people’s lives, and with NPS scores higher than that of Apple or Amazon, we believe our customers are delighted with their experience. As a founder and CEO, I can’t imagine another situation where I’d be able to take such pride and joy in everything that I do.
As for my least favourite – well, with all the exciting plans and projects we have in place, there are sometimes blockers and unforeseen delays which are beyond our control. My grandmother would have said that patience is a virtue, but unfortunately for me, it’s a virtue I rarely possess.
What inspired you to start your business?
Having experienced the inefficiencies of high-street banking, I became frustrated with the state of financial services, and how badly the odds were stacked against the customer – especially in the wake of the financial crisis. I knew there had to be a better way, and that the behemoths of the high street had gone unchallenged for too long. It was then that I began to take a keen interest in the concept of peer-to-peer lending (P2P), and, not long after, plans to develop Lending Works gathered momentum.
Where did the idea for your business come from?
I felt that the presence of a bank, or other intermediary in the equation of a person wanting to save money and another wanting to borrower was unnecessary – or at least not worthy of the profit margin they absorb. That’s where peer-to-peer lending simply made sense to me, and, having subsequently analysed existing platforms, we felt there was a huge opportunity to enter the industry, while offering something a bit different to the established guard.
How did you fund your business?
In the 18 months prior to launch, I subsisted mostly on my own savings. However, as things gathered momentum, we were fortunate to have the backing of a number of investors and this enabled us to get a world-class product off the ground. Some of these investors have been very involved with the business, so we remain hugely grateful to them for helping us shape Lending Works into what it has become today.
What has been the biggest challenge for your business?
Ultimately, 13 years after the concept was first devised, the industry remains relatively unknown to most people. While P2P is easy to explain, and most people are immediately enamoured by the concept, convincing the masses to divert their money away from the established institutions of the high street in favour of better-value alternatives is an ongoing challenge we face as a sector.
What do you feel are the biggest obstacles to growth for business in the UK?
Personally, I feel we are very fortunate as SMEs in the UK, with a sensible regulatory environment, low corporate taxes, a strong talent pool and plenty of support from Government. The biggest challenge is actually summarised best by an unfortunate statistic – you’re more likely to have a divorce than you are switch banks, hence, while we are not a bank, the same rings true. Inertia in financial services is often the biggest obstacle.
Have you made any mistakes along the way and how did you overcome them/learn from them?
I’ve made plenty! But in a business sense, none that I regret too much. I can’t think of any that have been down to negligence on my part, and almost all of them have been a crucial cog in the learning experience of growing a business from scratch.
What previous experiences have helped you in starting your business?
I believe a background in tech (my degree) and 8 years working in financial services provided a solid foundation for developing Lending Works. But as I’ve said above, I think working for a big financial organisation opened my eyes to the vast room for improvement within consumer finance, and that gave me the inspiration to pursue entrepreneurship.
What’s the best piece of advice you’d give to anyone looking to start their own business?
You will never know 100% of what you need to know. Your product will never be 100% complete. No personal or professional situation is ever 100% conducive to taking the leap into the unknown. The best piece of advice I can give, is if you have that burning desire, just do it. You’ll (have to) figure out everything else along the way!
Would you do anything differently if you could start again from scratch?
I would have done it much sooner.
What do you do to relax away from the hustle and bustle of work?
I have a keen interest in sport, particularly football and motorsport, so I keep a close eye on the Premier League and Formula 1 (and of course the World Cup!). I used to do race cars which was great, but very ‘resource heavy’. Now, though, my days off are spent mostly with family, and of course, I wouldn’t have it any other way.
What would you be doing if you weren’t running your own business?
Driving for Mercedes alongside Lewis Hamilton? Failing that, I would be getting the next business ready for launch!
Do you manage to achieve a good work/life balance?
That was a big challenge for me in the early days of Lending Works. However, since my first child arrived in 2015 (and the second a year later), I have found that my mind is fully present. So when I’m at work, I am fully focused on what I’m doing. However, when I’m with my family, or perhaps on holiday, I do try to hit the off switch, although often unsuccessfully.