Mintos - affiliated loan originators, complicated recovery process, Sebo deal

On October 23rd I did another interview with Martins Sulte, CEO at Mintos. Topics covered: affiliated loan originators, complicated recovery process, Sebo deal, real return of Mintos, quality of loan originators and their reporting.

Content of video:

• 00:00 Mintos & it's affiliated Loan Originators: what is difference between "Related parties according to IAS24" and "some equity investors overlap"?

• 04:40 How much % of Mintos and Hipocredit does Martins Sulte and Martins Valters own?

• 05:00 Which Loan Originators fall under "Related parties according to IAS24"?

• 06:25 Why are related Loan Originators paying only 3.6% of Mintos total income?

• 09:15 Loan Receivables - good idea in theory, but does not work in practice? Eurocent, Rapido Finance

• 10:30 Rapido Finance - putting obstacles

• 12:46 If Loan Originators are acting in bad faith, there is not much Mintos can do?

• 14:34 Why is it so hard to take over portfolios from failed Loan Originators?

• 16:30 Can any Loan Originator create many obstacles that ends with 0% recovery later?

• 18:56 Capital Service and their ridiculous offer to Mintos investors

• 20:20 Sebo was sold to Mogo for 2.9m EUR. How much was paid to Mintos investors?

• 26:00 Interest earned - is 120 million a real number, or part of it is pending/in recovery?

• 26:50 What are the real returns for Mintos investors?

• 33:40 Quality of Mintos Loan Originators, Invest & Access

• 39:40 Diversification in P2P - does it work? Or do we need certain quality?

• 42:50 Quality of companies and quality of reporting

• 45:20 Info that Mintos gets vs what investors get to see

• 47:00 Will Mintos standards change in regards who to accept as a loan originator?

• 49:00 Estimate overall - how will the "money at risk" change in the next year?

• 53:00 How is Mintos doing? How much money was provided of promised 5 million EUR?

• 55:20 Mintos will do more fundraising from outside investors

• 57:34 Can we expect new Loan Originators?

• 1:00:00 Mintos investor expectations - 10% or more?

• 1:01:25 Where will Mintos expand - in Europe or in LATAM, Asia, Africa?

More posts about Mintos:

• Mintos & conflicts of interest, Part 2

• Mintos & conflicts of interest, Part 1

• Mintos in 2020: 17 failed Loan Originators, €118 million at risk

• How to invest in Mintos?

• Who owns Mintos - interview with Martins Sulte

Key takeaways:

• Mintos investors got only ~10% from Sebo deal, so roughly 290k EUR

• ~40% of Mintos 2019 revenue was from affiliated loan originators

• If a loan originator decides to act in bad faith, that can result in a long and expensive recovery process. In worst cases like Eurocent and Rapido that can mean 0% recovery rate.

• Many Mintos loan originators are like black boxes for investors with no reports or low quality/old reports, and even Mintos CEO think they should be “punished” by not investing in them with the same interest rates, and instead requiring higher interest for additional risk.

• Current angel investors have not provided all 5 million funding as previously promised, but there is no urgency, Mintos has ~2 million EUR in cash. Plan is to raise next funding from outside investors.

• We can expect new loan originators, access to ETFs, IBAN accounts

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P.S. Join “High-risk investments“ Telegram group for an informal discussion.