As the modern world is facing one of its toughest challenges, in our first blog post we would like to discuss how we are able to smoothly continue our daily operations and would like to mention some of our upcoming updates.
Firstly, I would like to talk about the financial side of our business. Although the investment amounts have decreased in recent months, our platform has always been quite different from its competitors as the service which brings us a larger part of our revenue and profit is group-buying. At the end of 2019, we managed to successfully finish a group-buying deal which facilitated the selling process of 55 apartments located in Riga, Latvia. In the first quarter of 2020, we have started our largest group-buying project until this date, and we forecast that the deal will be concluded until the end of this summer. The received commissions from these two deals will allow us to operate the company without any external funding until the end of 2020.
Additionally, the previous years of 2017 and 2018, have been profitable for us as a business. In 2017, Bulkestate ended the year with a net income of EUR 55,111 and 157,425 EUR in 2018. The annual report for 2019 will be available in the summer, and we expect the company to be profitable also in 2019.
Of course, we also had to decrease our operating costs and until the travel restrictions and nationwide security measures will be lifted, our team has agreed to take a 20% pay cut. We also discontinued some outsourced services and partnerships that are not crucial to our daily operations. This will allow us to smoothly continue our operations until 2021.
Secondly, we have contacted the borrowing companies and offered our help if some of them will face problems making repayments at the loan due dates. Each case will be evaluated individually to find the best solution for our investors and borrowers.
Thirdly, the amount of made withdraws by our investors has increased, but our team has been able to process payments at the usual rate, and no significant delays have been brought to our attention. It is possible that for some transfers the banks will take more time to clear the payments, but usually, the delay for deposits or withdraws has not been longer than 1-2 working days.
More about our daily operations
Our day-to-day work has not been affected that much, as a crowdfunding and group buying platform, we use the opportunities of the digital age in full measure and consequently worked from our home offices during the lockdown. Meetings took place via telephone or video conference and day-by-day communications were made with instant messaging. The operational business of our platform is fully protected at times like this, and the whole business can be made digitally and none of our employees nor any partners nor any investors are exposed to any risks.
Now we are continuing to do what we do the best: We search for lucrative investment opportunities, analyze them in the deepest details, and offer them to you on our platform.
Why did we choose to start our blog now?
For the last three years, we have become what we intended to be – a growing club of people enjoying both the rational and emotional benefits of successful collective investment.
Of course, we owe the utmost gratitude to our loyal investor base because without you we would not be able to exist and persevere through the challenges that we and the industry have faced. We can't deny that we haven't been the most vocal platform but this blog was created to let our followers know about us, the real estate industry, and our future plans - so let's start!
In this short period of time, more than 13 million euros have been lent to 75 projects for business owners and real estate developers. The average interest rate for our investors remains above 14% per annum and our user base has increased to more than 5700 happy investors. The most important thing is that our investors have already received more than EUR 850 000 in interest payment and cash-backs. If you compare the ratio of paid out interest against the originated loans, Bulkestate would be one of the leaders in the P2P industry, and once again, numbers show that our mission of providing profitable investment opportunities is being fulfilled.
Additionally to the successful crowdfunding projects, we have been actively working and have executed 3 group-buying deals. This is a completely new service and before this, it was never applied to the real estate industry. Our solution helped three large property owners to find buyers for their residential buildings and more than 50 individuals were able to purchase apartments in Riga under the market value.
Since our establishment, we have strived to establish a pipeline of profitable and secure investment opportunities. Although the project flow has not always been as consistent as we had hoped for, our outlook on the future remains bright as we have recently entered the Finnish market and developed new partnerships that will increase the flow of investment projects, accordingly, keeping the project flow steady.
Oncoming legislation was another reason for our patient silence. No doubt, like any service provider, crowdfunding platforms must operate in compliance with all applicable EU and national laws and regulations. For example, to operate as a financial institution and issue loans to companies, Bulkestate holds a financial institution license in Estonia. Now, with the growing popularity of crowdfunding, specific legislation is on the way, making the whole sector more structured and transparent, and your investments more compliant with the uniform rules.
To increase the security of our platform, we have been working to introduce a KYC solution and two-factor authentication to Bulkestate. This project is still in development and will be launched in the coming months. As the new updates will ask for your participation in terms of submitting the necessary documents, we kindly ask you to be patient as this will benefit all involved parties. We will provide a more detailed overview of the near changes as soon as we will be ready for the launch.
Nevertheless, the main reason for us to break the silence… is you. Crowdfunding platforms are becoming more popular in the world of finance, and Bulkestate is becoming more popular in the world of crowdfunding.
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