What do banks, mainstream lenders and traditional finance structures all have in common?
Each is in the process of becoming victim of a big disruption – a disruptive financial innovation which enters the market, with a bang.
Peer-to-peer lending, equity crowdfunding, invoice trading and pension-led funding have all shaken up the finance market and provided entrepreneurs with a wider range of options.
They usually adopt dramatic market adoption right out of the gate from contrarian investors, often causing collateral damage to traditional finance models.
You see, when a new finance model appears, smart and savvy entrepreneurs suddenly and enthusiastically abandon older and even defining finance inventions for something new and often untested, often gaining a competitive edge.
More often than not, new finance models combine existing off the shelf components with new finance innovation, which is often advantageous than traditional products leading to as sudden abandonment of the ‘old for the new.’
The biggest opportunity…
to ‘cash in on cashflow’ comes from anything that scares mainstream banks & banking systems which is most likely to make you the investor/entrepreneur, the most profit.
The internet has wreaked havoc with everything from music publishing right through to betting and now banking. The past decade has seen traditional high street banks and lenders come under sustained attack.
At first, internet banking meant they could leverage lower costs to offer better rates.
The taking of deposits to finance loans is under attack from alternative finance methods which have disrupted conventional lending.
This has included “payday lenders” such as Wonga which uses smart technology to make rapid lending decisions and peer to peer lending platforms, such as Zopa, Funding Circle, and “crowdfunders” like Crowdcube, Platform Black and MarketInvoice.
‘Bank of Dave,’ is causing a stir, Bitcoin is making its presence felt & crowd funding sites are pooling ordinary investor’s money and replacing orthodox bank finance.
How about other financial and technological advances such as Square which target individual proprietors, most of whom considered themselves too small to take credit cards before Square?
In international money transfer, Xoom targets immigrants remitting home to their families, not big corporate transfers. Prepaid debit cards like Netspend, Greendot and AccountNow all target the underbanked.
Startups are innovating with an opportunity to disrupt from below and grow fast. Yet in practical terms, these new platforms have opened up opportunities for adventurous investing types who have rushed to embrace these new platforms.
- The “non-bankers” who provide alternative financing now matter as much as the traditional mainstream bankers…
- The “non bankers” can turn a big profit by extending credit because banks are no longer supplying credit to new start-ups and disruptive entrepreneurs…
- The “non-bankers” are swelling in size because they do not face the same regulatory burdens as banks, allowing themselves and borrowers to cash in on the gap left by mainstream institutions…
And what nobody can deny – is that non-banks’ business has boomed due to unmet demand by savvy investor/entrepreneur types like you.
The great irony of the post crash regulatory clampdown is that it forced established banks to become safer, more regulated – giving wings to a gaggle of new financial players – with potentially unpredictable consequences.
There’s a lot of disruption in the pipeline my friend.
And much of it will be unpredictable—at least in the early stages of planning.
What’s core to your business and property model may be something new start ups ‘give away’, perhaps without any real strategy for monetising their success until after it happens.
Taking advantage and seeing them coming, responding in time, and creating your own ‘Big Bang’ disruption requires new skills, new organisations, and new business models and often going against conventional wisdom
But contrarian, by definition, means the opposite of the herd mentality and the masses, right? It also means most people don’t know this.
But what’s interesting is there may be [some] more obstacles, and probably a little more difficult – but easier to obtain than conventional routes. But there are usually some sweet spots, halfway between creativity and liquidity.
Over the last few years innovative property investors have taken their business to new heights – and pushed it onto the next level. And that’s had a dramatic effect…
Not only has it enabled them to shake up the entire business world, and transform their lives in general – it’s also helped them to make a fortune.
You see, when new finance companies are finding their way in this brave new world, you will need to adapt. Not just to survive. No. But to take advantage of the profound possibilities for success the disruption makes possible.
This will increase your buying power, reduce the time it takes to build your portfolio and wealth and reduce your risks significantly in many cases.
A Triumph of the Investor
Call it, if you like, a triumph of the entrepreneurial/investor spirit or a testament to your ability to run rings around rules.
Either way, if you can see it coming, disruptive change is your biggest opportunity for cash for property, business or simply to build you a better life.