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The importance of deep diving into numbers - Crowdstacker Peer to Peer Investment

The Deep Dive

1st September 2015

Which is the odd one out? Jacques Cousteau? The comically leggy ostrich? The elusive Cuvier Beaked Whale? Or the Crowdstacker Management team?   

Maybe the title of the piece gives it away, but of course the answer is the ostrich. All the others are accomplished divers.

Jacques Cousteau brought the mysterious underwater world of deep sea diving to the masses over 60 years ago, with his acclaimed documentaries.

The rather shy Cuvier Beaked Whale thrashed previous known records for mammal diving last year, reaching depths of 2992 feet, and remaining submersed for an astonishing 138 minutes. 

And of course the Crowdstacker Management team achieves deep diving feats of its own on a daily basis as it delves into the accounts of businesses hoping to use the platform to raise finance.

The ostrich, meanwhile, merely shoves it head in the sand.

The importance of deep diving into numbers
Whilst the process of finely picking through and interrogating a business’s accounts may not sound as enthralling as swimming in the deep waters of the world’s oceans, it is nonetheless a founding principle of how Crowdstacker works.

There are two key features to this. The first is to look closely at the numbers to check they stack up. Cashflow, profits, capital expenditure, assets, and how the business currently funds itself – these are the underwater flora and fauna that need to be seen up close. 

And the human element is just as, if not more, important. So Crowdstacker also looks at who is in charge (the big fishes, if you will) and whether they are doing a good job. Questions are asked about the strategy of the business and the pathway it wants to follow, along with objectives and forecasts that need to be stress tested. 

As Karteek Patel, our CEO, explains: “It’s about creating much more compelling investment opportunities for consumers.

“We believe we are very different to the other current peer-to-peer platforms. Our goal is to focus on more established businesses with finances that stand up to close scrutiny or those run by experienced teams with a strong track record supplemented with a good security package. We use a comprehensive due diligence process, using professional due diligence experts rather than just the automated analysis or light touch approach used by some others.

“Of course higher risk businesses can play a part in an investor’s portfolio, but from the start we wanted to offer something with the potential for more protection and stability for investors. 

By only doing a deep dive can we really see what is going on”.

So if you lend or invest your money and want to get your money back, we think it pays to be a deep sea diver, and not just stick your head in the sand like an ostrich.