LoanXchain is the first digital secondary loan marketplace in Europe, answering people’s needs by tackling the financing gap emerged after the financial crisis. It empowers a cooperative lending ecosystem, where resources smoothly flow from savers and investors to families and corporates thanks to revamped lending capability. This spurs growth in the real economy and generates more resources which flow back to savers and investors.
As part of their journey on BlockStart’s Acceleration Programme, as a startup developer of blockchain technology, they were looking to further develop their solution and for new opportunities for collaboration with end-user SMEs that could validate and help them improve their “LoanXchain” blockchain solution.
We spoke with CEO and Co-founder Mattia D’Alessandra to know more about LoanXchain and their participation in BlockStart.
In one paragraph, what is LoanXchain?
LoanXchain is the first fully digital and blockchain-based loan secondary marketplace in Europe. It empowers a new cooperative lending ecosystem, where lenders and institutional investors work together to finance the real economy generating more growth and more jobs for the benefit of the whole society.
Can you tell us how the idea for your startup began?
LoanXchain was born at the end of 2017 from the contamination of my professional experience and that of Maura Rossetti, the other co-founder. Together we realised that the post great-financial-crisis environment characterized by low interest rates, tough banking regulation and rapid digitisation was forcing the loan market to radically change to survive. Such need has been further strengthened by the Covid crisis. For us the future of the loan market was and is that of a cooperative and open ecosystem were traditional players, such as banks, and new entrants, such as digital lenders but also investment funds, cooperate to leverage each other specific strengths and better finance the real economy.
What is LoanXchain passionate about achieving?
We are excited about LoanXchain because we are aware it can have a material impact on our society and the European economy. Our ambition is to help tackle the huge financing gap emerged in Europe over the last few years. Such gap was estimated to be at around € 400 billion, even before the Covid-crisis that further exacerbated the issue. We are talking about a huge loss for our economies, that translates into millions of jobs and SMEs at risk.
Who are the team members and what backgrounds do you have?
Our team combine a unique mix of young professionals with genuine approach to innovation and senior experts with great experience in executing international projects and delivering enterprise-level solutions.
This great diversity of experiences, seniority and background has always been recognized as a great asset for our company and we are proud of it!
Can you tell us about the prototype you have developed with the support of BlockStart Acceleration Programme?
Blockstart helped us complete and launch our product: LoanXchain the first multilateral loan marketplace powered by blockchain, AI and API. It enables dynamic management of loan portfolios integrating originate-and-hold, originate-to-distribute and originate-to-share lending models and industrialises investment in loans thanks to digitisation of due diligence and sale processes, both direct sales and securitisation.
Our solutions fully answers market’ needs of liquidity, transparency, speed and broadened participation, while also enriching the marketplace with an entire ecosystem of value-added services.
What were you most excited about in taking part of BlockStart Acceleration Programme?
We knew from the start to be about to enter a thriving ecosystem of mentors and SMEs fully committed to support the startups in the program and we looked forward to testing our solution in such an environment. In fact, we really benefitted from BlockStart for developing our business and product.
Which were the major challenges you have faced during the development and market/fit validation of your prototype?
For us a major challenge is to win the trust of our potential clients, which are financial institutions and therefore are really conservative when it comes to adopting new solutions impacting their balance sheet.
At this regards Blockstart has helped us to enter the market by connecting us with innovative SMEs looking to adopt new blockchain-based solutions to expand their business.
What unique aspects does your company and the prototype you have developed have to offer to the market sectors/type of companies you wish to enter/sell and to the blockchain ecosystem in Europe, as a whole?
Thanks to a radically innovative approach LoanXchain enables, for the first time, lenders and investors to directly cooperate to finance the real economy.
With our digital secondary loan marketplace lenders can increase lending and profitability, while investors can leverage lenders’ network of branches and customers to access new investment opportunities.
It is a win-win cooperation, which also benefit the whole society thanks to easier access to credit, improved financial inclusion and reduced risk of credit crunches.
Is collaboration with SME adopters important for piloting your solution?
For us it certainly is. It helped and helps us to find concrete use cases to start the go to market process. We are happy that BlockStart enabled us to do it in an easy and enjoyable way by managing the interactions with the SME adopters.
Where do you see your company in 5 years?
We aim to be the leading secondary loan marketplace in Italy, our core market, and potentially to start targeting other European countries as well. At this regard, we consider Southern European ones a particularly good fit thanks to the similarities with the Italian banking system. From a technological perspective we aim to fully implement and take advantage of loan tokenization as a substitute to traditional loan transfer methods (such as direct sale and securitization).
Apply to our Open Call #3. 5 days left!
In our 3rd and final Open Call, we are looking for early and growth-stage blockchain/DLT startups from all over the EU and H2020 Associated Countries in the fields of fintech, ICT and retail and will provide startups with access to a variety of perks, including equity free funding of up to €20.000, access to piloting opportunities, mentorship, and exposure to investors and advisors.
Interested startups should fill in an online application form at F6S platform. Deadline for applications is 26 May at 5pm CET (Brussels Time).
For more information on application criteria and how to apply, interested applicants can go to blockstart.eu and consult the FAQ section. BlockStart will also organize a Q&A webinars for future applicant on 12 May 2021 at 11am CET (Brussels Time), and you can save your seat here (takeaways of the previous Q&A webinar available here).