Interview by Peggy Spear
Michael Ping has an easy analogy when describing his concept of marketplace lending at Blackhawk Corp: It’s kind of like investment online dating,” he says. “We help match up the interested lenders with the appropriate borrowers.” That’s not to trivialize the impact P2P lending is making on the commercial real estate market. Blackhawk Corp. is the first company diving into this niche sector that Ping sees as revolutionizing the traditional lending market.
What is your background, and how did you develop the concept for Blackhawk Investments Corp.?
When I sold an Internet company back in the early 2000s, I wanted to dive into the real estate market. I had grown up in the Bay Area. I saw all the new wealth that was coming to the area, and wanted to see what was out there. Unfortunately, I saw how difficult it was for borrowers to procure enormous loans from traditional banks, despite the fact they had assets. High-end buyers couldn’t get the financing or credit they needed.
P2P lending emerged from that, led by such companies as Lending Club and Prosper. At first they were on the fringe, and now they are going mainstream. Blackhawk Corp. is zeroing in on the commercial real estate market, which sets us apart. P2P lending created a platform that augments the traditional credit market and bridges funding mechanisms. We do what the banks want to do.
What is the concept behind marketplace lending?
marketplace lending allows assets to become a bankable loan for private investment. It provides better terms for both the lender and the borrower, with a return rate between 6 and 11 percent. The borrower will pay less than current lender sources and lenders will get a greater rate on their investment.
How is Blackhawk making its mark?
We have platforms where investors can identify and vet projects, specifically for the commercial real estate market. We created the ability to auto-broker to ensure the best rates for borrowers and investors.
What is unique about your site?
Our site is contemporary, simple, and to the point. There is an introductory video that helps each party find a match for them. We also have elegant infographics that explain how the P2P process works, as well as featured investments. Our FAQ section answers, in simple terms, the questions that both investors and borrows will have. Our blog also complements the site, on which we can feature content from our sources and others that will help investors and borrowers get the most updated information on the industry.
What are the benefits to lenders? Borrowers?
Quite simply, as an investor, we have safeguards in place that will help with better returns. There is no self-directed option like that out there today. Investors can choose the type of project they are interested in helping finance, along with the types of rates they want.
For borrowers, they can get better rates and a guaranteed investor. The rates are lower than in traditional lending practices, and there are no broker fees involved. A lot of fees don’t need to be paid. It’s a win-win for everyone.
In your opinion, what does the future hold for P2P lending? Will it be the rule, rather than the exception?
In my opinion, P2P is a niche player right now. As it moves forward, peer lending can provide secure loans for all levels of investors. The fact that with sites like Blackhawk Corp. we can do it online rather than go through a bank is a big plus.
I feel that P2P lending is here to stay. They won’t eclipse banks but provide a different function. They will complement each other. Investors and borrowers can check it out and if it works for them, then they can just do it.
What is your vision for Blackhawk Investments Corp.?
My ultimate vision for Blackhawk Corp. is to have one platform become the go-to location for peer lending, one location borrowers and lenders can go to meet their needs. I want to be able to educate both parties, inform people about the market, and provide the tools for them to make the best financial decisions for themselves. When I wanted to get into commercial real estate, there was no one place I could go as an investor or as a borrower. Now there is. Basically, we help people in their ability to succeed.