March 15, 2020
Today I received an e-mail from Estateguru regarding the Corona situation and their safety measures
E-mail from Estateguru
We at EstateGuru, like everyone else in the world right now, are closely following the extreme measures our governments are taking to protect their economies. There’s no doubt that life on the planet will change and we will do our best to ensure that it changes for the better.
We believe that one of the major changes brought about by the crisis will relate to how we work. Digital business models and working remotely will lead the next wave of the economic future. Our platform is 100% digital, and you can use every part of it on your computer, without leaving your home. One could even argue that people will have more disposable income during this crisis as they no longer travel and don’t go out (e.g. revenue for cinema tickets in China has decreased five-fold). We should all have more time and motivation for reading, spending time with our loved ones, and thinking of future strategies for saving up and investing wisely.
Crowdfunding, born as a result of the last major financial crisis, could play an essential role in easing the current situation by helping companies to raise much-needed financing. One of the challenges of this crisis is not an absence of capital per se, but the inability to provide or access fast funding, mostly due to execution risk, e.g. face-to-face interactions with bankers, public notaries, etc. Crowdfunding is the best solution to this problem as it can be executed online in a manner which keeps the public safe. Governments and EU institutions could also help by channeling funding through crowdfunding platforms.
Alternative property-backed financing is a much-needed tool for companies in these turbulent times as they provide the perfect solution for creating liquidity and executing business plans. Current countermeasures put in place by governments should be sufficient to keep the economic consequences of Covid-19 confined to the travel and leisure industries. Other industries will also experience negative influence but it will come with a delay and will be lower.
Our stress tests show that our investors’ outstanding loan portfolios have a sufficient buffer to overcome these hectic times. That is why our historical LTV has remained below 60%. Furthermore, most of our loan collaterals are related to the residential segment, where the negative effect will be the lowest, as living spaces remain a primary need for humans. We are closely monitoring the macroeconomic and real estate market situations, and we have been and will remain conservative in making credit risk decisions.
To further ensure platform stability we have established certain operational safety measures. Our teams are working from our home offices and carry on their full duties remotely. 90% of our processes are automated and we have double service providers in key business areas, which guarantees that if one provider is not able to offer the service, we can switch over to the other at a moment’s notice (e.g. Onfido and Veriff).
Despite the burgeoning emotions about the state of our planet, we truly believe that every crisis contains lots of new beginnings and opportunities for all of us. It reminds us of what is important and that we should all have a defined mission. Ours is to make property financing and investing attainable for anyone, anywhere in the world.
We are monitoring the markets and the situation daily and will do everything in our power to provide the best service possible.
Wishing good health to you and your families!
Co-Founder & CEO