January 2020: the drama of Kuetzal and Envestio
The disappearance of the Envestio platform shocked the market this month. The police in Estonia has started investigations into them for fraud and theft of investors funds. Further down this post you can read how you can file a crime report for both platforms, every investor in these patforms is highly encouraged to do so.
The European Commission has reached an agreement (provisionally) with the European Parliament about legislation for crowdfunding in the EU. It still needs a final agreement, but it it expected to be in effect in the first half of next year. Once adopted, it will harmonise the rules for investment-based and lending-based crowdfunding platforms operating in the European Union. It will make it easier for them to operate cross-border in the EU, thanks to a single licence. It will also ensure a high-level of investor protection. It also gives investors 4 days to cancel any investment, in case they change their mind. This should really help to get to a more mature market.
A group of investors is starting a lawsuit in an attempt to get their money back from Envestio, just like was done for Kuetzal. IF you want to join there is an important deadline at Sunday February 2nd, at 18:00 CET. You can read more about it below.
This month I have withdrawn funds from higher risk platforms, and invested this in a new platofrm: EvoEstate. I’ll introduce this new platform below, but first it is time for this month’s numbers. So keep on reading!
Portfolio overview January 2020
Last month the interest payments I received totalled € 668.66 so it is clear that the loss of Kuetzal and Envestio has quite the impact om my monthly passive income.
My average rate of return over all platforms is 12.1% and the table below shows the details for each platform.
|Bondora||€ 31.58||6.8%||€ 5,528||Info|
|Brickstarter||€ 0.00||0.0%||€ 2,015||Info|
|Bulkestate||€ 10.17||3.4%||€ 3,144||Info|
|Crowdestate||€ 6.15||9.7%||€ 5,705||Info|
|Crowdestor||€ 108.56||16.0%||€ 8,503||Info|
|Envestio||€ 0.00||18.0%||€ 10,942||Info|
|EstateGuru||€ 27.77||9.9%||€ 2,876||Info|
|EvoEstate||€ 0.00||0.0%||€ 2,015||Info|
|Fast Invest||€ 55.73||13.4%||€ 5,375||Info|
|Flender||€ 20.28||5.0%||€ 2,808||Info|
|Funding Circle NL||€ 34.29||8.7%||€ 4,596||Info|
|Grupeer||€ 91.41||14.5%||€ 8,373||Info|
|Iuvo||€ 82.89||11.6%||€ 10,533||Info|
|Kuetzal||€ 0.00||15.7%||€ 4,414||Info|
|Lender & Spender||€ 9.08||4.0%||€ 2,764||Info|
|Mintos||€ 85.82||11.3%||€ 5,822||Info|
|Reinvest24||€ 3.95||-6.1%||€ 989||Info|
|Robocash||€ 2.45||6.8%||€ 1,032||Info|
|TFG Crowd||€ 33.41||17.2%||€ 1,281||Info|
|Twino||€ 54.77||10.9%||€ 5,802||Info|
|Viainvest||€ 10.35||10.4%||€ 1,060||Info|
|Total||€ 668.66||12.1%||€ 95,578|
The XIRR column contains the annualized rate of return since my first deposit into that platform. Click on a column header to sort the table by that column, twice to reverse the sort order. I have an overview page for each platform, you can click on the magnifier glass to visit that page.
Interest income per month
In the chart it is even more visible what impact the loss of interest income from Kuetzal and Envestio:
To show you how little effort is involved when investion via crowdfunding and crowdlending I have added an overview of the manual actions in the last month:
|Kuetzal||January 1||Uploaded ID documents|
|Kuetzal||January 6||Withdrawal request after ID approval|
|Envestio||January 9||Withdrawal: € 1,000|
|Iuvo||January 9||Withdrawal: € 500|
|Fast Invest||January 14||Withdrawal: € 2,000|
|Crowdestor||January 23||Withdrawal: € 500|
|EvoEstate||January 23||Deposited funds: € 2,000|
|EvoEstate||January 24||€ 200 invested in Magellan in Madrid, Spain (15%)|
|EvoEstate||January 24||€ 200 invested in Marquis of Cádiz (Málaga) in Malaga, Spain (8%)|
|EvoEstate||January 29||€ 200 invested in Brava IN Fase 2 in Sant Feliu de Guixols, Spain (7%)|
|Fast Invest||January 30||Sold loans, approx. EUR 2700|
|Fast Invest||January 30||Withdrawal: € 3,000|
|TFG Crowd||January 30||Withdrawal: € 340|
|Robocash||January 31||Updated auto-invest for cashback action|
|Seedrs||January 31||€ 1,615 invested in Hycube|
I did check the platforms every now and then, but this was purely for fun. It wasn’t necessary to get these interest payments and return rates.
Equity crowdfunding platform Seedrs, where you can buy shares in start-ups, has grown 49% in 2019 compared to 2018. Investors from 78 countries have invested GBP 283 million last year in 250 deals.
My virtual return rate at Seedrs is now 27%, not bad for just one year. Of course this doesn’t say much, as these are investments in start-ups so not all of them might survive. The idea is that some could become really valuable and compensate for the other losses.
Het is possible to sell shares on the secondary market, although this is not always opened. And you cannot set your own price, the price is determined by the last investment round. Brickowner has had multiple investment rounds, and after my investment the shares increased in value and have been split. This resulted in a 77% profit just for my Brickowner investment, and the 27% increase of my overall portfolio value.
When you want to try Seedrs for yourself, you can register via this link and you’ll receive £25 free investment credit after investing £150 or more within 30 days of signing up to Seedrs (around 175 euros).
My investments at Bondora returned € 31.58 last month, and my average return rate is now 6.8%. Bondora Go&Grow offers a lower interest rate compared to other platforms and portfolio options, but the main advantage is the instant liquidity. You can withdraw your funds instantly to your own bank account, all of it and at any time. It’s like a savings account on steroids.
When you register through this link you’ll receive a 5 euro bonus. Just give their Go & Grow option a try and don’t try the other advanced options.
My investments at Brickstarter have not returned any interest yet, but I have just started here a little over a month ago. Next month I expect to see actual income here.
My return rate at Bulkestate is still very low, but several projects pay the interest at the end of the investment period. I expect the total picture to look a lot more positive at the end of summer. The website is really informative about this, if shows a lot of infromation such as the received interest, expected interest, and the payment schedule.
My investments at Bulkestate returned € 10.17 last month, and my average return rate is now 3.4%.
Crowdestate has communicated that the court has approved the reorganisation plan for Baltic Forest, and has appointed a reorganization adviser, who supervises the implementation of the reorganization plan. This increases the chance that investors will get their money back, but it will take more time.
My investments at Crowdestate returned € 6.15 last month, and my average return rate is now 9.7%.
Crowdestor is one of the platforms that sent a reassuring email to the investors after the Kuetzal and Envestio debacles. They emphasize the financial stability and reliability of the platform. They too promise to increase their transparancy this year.
Crowdestor dos not have a secondary market, so there is no possibility for an early exit. They have talked to a small group of investors though, and this group has agreed to buy investments from other investors. So there is no risk for the platform there, and I assume that group of investors will get a nice discount. Soon Crowdestor will let investors know how they can submit a request for this buyback.
I don’t intent to seel my investments right away, but I am thinking about lowering my investments here be withdrawing returned interest and principal. The interest rates are really great, up to 20%, and my average return rate at the moment is 16%. But this kind of feels like too good to be true now, although I haven’t seen any reasons for actual concern.
My investments at Crowdestor returned € 108.56 last month, and my average return rate is now 16.0%.
The sudden disappearance of the Envestio platform was a huge shock. A really unpleasant one, considering the huge amount I had invested there (11% of my entire portfolio). All investors are encouraged to file a criminal report with the Estonian police, via this link.
A group of investors is getting organised to try to get the money back via a lawsuit. If you want to join you have to hurry, the deadline is Sunday February 2nd at 18:00 CET.
The first step is to register yourself via this online form. It is important to do this before the second step.
The second step is to make a donation to cover all expenses, and the amount has been set to 0.8% of your invested funds at Envestio. Without the donation you cannot join the effort, you can read more about this in the Telegram group @EnvestioDiscussion. I joined ad made the donation, I feel that without this the chances of getting my money back are really small. Of course there is the risk that there is no money to get back anymore, and this is lost too. But since there is not that much difference between lossing 100% of my money and losing 100.8%, I think is is worth it..
You can make the donation via this GoFundMe page (but make sure you have registered first).
EstateGuru has recovered investors’ money from two defaulted loans. One loan defaulted in October, but the sale of the claim resulted in a 11% return rate for the investors. The other loan defaulted a year ago, in December 2018, and EstateGuru had the property auctioned. The investors got their money back, and even made a modest 4% profit. Of course the most important thing is to get the money back, and it is reassuring that investors’ losses at EstateGuru are still 0%.
My investments at EstateGuru returned € 27.77 last month, and my average return rate is now 9.9%.
I stared at a new platform this month, EvoEstate:
The special thing about this platform is that is publishes projects from 18 other platforms, allowing you to spread your investments over a lot of platforms without the need for your own account with each of those platforms. It doesn’t cost investors anything extra, EvoEstate gets a small commision from those platforms.
You can invest in projects from Brickstarter, Crowdestor, Housers, Max Crowdfund, Nordstreet, Profitus, Reinvest24, Rendity, and 10 others.
EvoEstate chooses which projects it publishes, which I think adds an extra layer of security. The owners of EvoEstate invest in these projects as well with their private funds, these are clearly marked as “skin in the game” projects.
When you register via this link you’ll receive a bonus of 0.5% of all your investments in the first 6 months.
I withdrew a significant amount this month from Fast Invest, because I had invested 11% of my entire portfolio value here. Now this is down to 5%, bringing it more in line with the other platforms.
Several people are questioning the reliability of this platform, considering the lack of transparance and the unexperienced management. This is also one of the reasons to lower my investments there and move funds to other platforms. My first withdrawal this month was in my bank account a few days later, and my second withdrawal is pending. I hear from other investors that they have received their withdrawals without problems, so that is no reason for concern.
My investments at Fast Invest returned € 55.73 last month, and my average return rate is now 13.4%.
I have been investing via Flender for four months now, and my return rate is slowly climbing. According to my dashboard the average interest rate of my investments is 8.65%, but I expect it will take a few more months to reach that. Assuming no borrower gets into problems of course, this platform does not offer a buyback guarantee. But it is a welcome diversification of my portfolio, as all loans are from Ireland.
My investments at Flender returned € 20.28 last month, and my average return rate is now 5.0%.
Flender now offers an amazing welcome bonus when you register via this link: 5% bonus over all your investments in the first 30 days. Just don’t ask me how it can be this high, or how long it will last..
Funding Circle NL
My investments at Funding Circle NL returned € 34.29 last month, and my average return rate is now 8.7%.
Grupeer is one of several platforms that sent a reassuring email to investors. They said they now realize that transparency and investor’s trust are most important, and that they will really work on this this year. Transparancy of the loan originators will be increased, and the 2019 financial statements will be published on the website as soon as possible.
My investments at Grupeer returned € 91.41 last month, and my average return rate is now 14.5%.
Iuvo won the ‘Company of 2020’ award at the Forbes Business Awards 2020, in the Finance category. A good sign, and recognition, but it must be said that it was Forbes Bulgaria that presented the awards, so it was more of a local thing.
New at Iuvo is the realtime currency exchange. This makes it easy to invest in loans in a different currency, something I am already doing at Mintos.
But I will move some funds from Iuvo to a different (new) platform first, to have more diversity. Currently 11% of my portfolio is invested via Iuvo, and with all recent developments I think that is too much for me to have in any platform.
My investments at Iuvo returned € 82.89 last month, and my average return rate is now 11.6%.
On January 29th the sebsite of Kuetzal suddenly went completely offline. Earlier this month they claimed they started to close the platform in an orderly fashion, and to return the investors funds, after several investigations by investors found the projects to be fraudulent. It seems the whole platform is a scam. A process has started to get the company be declared bankrupt, which is the first step in getting the investors’ funds back.
I received an email from the ‘Fraud and Economic Division, Crime Bureau’ of the Estonian police. They received my crime report, and sent a list of data they need to commence with the case. The mail can be found below, and I advice other investors to send the same data to the mentioned email adress to get as much pressure from the investors as possible!
Lender & Spender
My investments at the Dutch platform Lender & Spender returned € 9.08 last month, and my average return rate is now 4.0%.
Mintos has a cashback action until the end of February: a 1% cashback bonus if you invest a minimum of 100 euros in Turkish loans from the originator Wowwo. There are several conditions, and you get to register yourself for this campaign. I have added a special auto-invest portfolio for this, and temporarily disabled my existing auto-invest. And of course I have added a reminder to my calendar to reinstate the old auto-invest after the campaign ends.
Investing in other currencies works really well at Mintos too. My return rate for KZT (Kazakh tenge) is now 12.7% and my return rate for RUB (Russian ruble) is 14.5%. When I calculate the values into euros using the Mintos exchange rate the return rates are even higher: 29.2% and 25.2%. But there is the risk of exchange rate fluctuations, which could also work to my disadvantage.
The problems with Aforti, IuteCredit, and Monego seem to be solved, I haven’t heard any news about them and I see no negative impact on my return rate or account values.
My investments at Mintos returned € 85.82 last month, and my average return rate is now 11.3%.
When you register via this link you’ll receive a 1% cashback bonus over all your investments in the first 90 days.
When I only look at the month of January, my income at Reinvest24 was equal to a 4.8% annual return rate. Already close to the promised 5-6% profit based on the rental income. So it is mostly the one time 2% fee that is lowering the return rate. I guess this will not be visible any more after a while, especially when a property is sold and I get my share of the increased property value. This will probably take a while, but these are not short-term investments anyway.
I received a quarterly report from the SPV that manages the “Restaurant and wine boutique commercial space in Kadriorg” project. The overview shows rental income per month, as well as the management fees and the profit:
Despite the negative return rate at the moment I feel this type of investment is a solid one.
My investments at Reinvest24 returned € 3.95 last month, and my average return rate is now -6.1%.
Robocash celibrates it’s 3 year anniversary this February. They also started publishing loans from Singapore in December. To celebrate both facts, they have a cashback action: 0.5% bonus for all investments in loans from Singapore with a minimal interest rate of 10% and a maximum term of 365 days. These cashback bonusses will be paid between March 2 and 6. I have adjusted my auto-invest to take advantage of this.
I do not see any loans from the Philippines anymore, so apparently those problems are fixed. But my return rate dropped the last two months, shich might be connected. According to my dashboad there is still 25 euros of accrued interest so that might improve the picture.
My investments at Robocash returned € 2.45 last month, and my average return rate is now 6.8%.
I received an email from TFG Crowd on January 30th, to inform me that the funds from two projects was returned to my account (Indoor Karting Race Track and Indoor Playground for Kids projects): “The borrowers failed to meet the requirements of the owner of the premises and the lease of the premises was terminated with them”. When I checked the money was indeed in my account, ready to invest or to withdraw.
TFG Crowd is one of the platforms I am doubtful about now, after the Kuetzal and Envestio scams. I have started investigating the platform and the published projects, but this takes a bit longer because of all that is happening. I did find some interesting things, which did not have a positive effect on my trust in this platform.
The next days I will continue my investigation, and publish my findings here. I also requested the withdrawal of the returned funds, which was in my own bank account within one day. That’s something a lot of platforms can learn from.
My investments at TFG Crowd returned € 33.41 last month, and my average return rate is now 17.2%.
Twino is a good performer in my portfolio, my return rate is steady around 11%. The return rate shown on my online dashboard is 10.97% and my own calculations show it as 10.94%. A lot of the other platforms try to paint a better picture, presumably by taking unpaid interest into account.
After all that has happened with Kuetzal and Envestio, I think 11% interest is something to be really happy about. The platform has been active for 5 years, and the company has been issuing all loans by itself since 2008. Combined with the buyback guarantee and payment guarantee this makes me consider this platform to be one of the pillars of my portfolio.
My investments at Twino returned € 54.77 last month, and my average return rate is now 10.9%.
Viainvest also has a long history, it started issuing loans in 2009 and introduced the online platform in 2016. My return rate has been really good in the 6 months I have been investing here. The platform offers a buyback guarantee that also covers accrued interest, so I am considering depositing more funds here.
My investments at Viainvest returned € 10.35 last month, and my average return rate is now 10.4%.
This summer, on June 19-20, the second crowdfunding conference will be held in Riga. This edition there will be a lot of attention to the protection of investors by the platforms.
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Below you can also find the link to my previous posts, where you can find my tips and results of the previous months.
Why you didn’t write off Kueztal and Envestio???
Your XIRR is all wrong!
Hi Steve, your absolutely right. Last month I forced my income from those platforms to zero, but I wanted to show the enormous XIRR drop plus the XIRR of the ‘real’ platforms. I have a custom application that calculates all overviews and XIRRs automatically, which I needed to reprogram for this. This was complicated and I did not have enough time, but next update (this weekend) this will be corrected and I will show both.