Keepers Meets Ian Humphreys, CEO of Brickflow

Keepers: Thanks Ian for joining me today, can you please start us off with an introduction to your career so far and how you go to founding Brickflow?

Ian: Thanks Keepers. When I finished university back in 2003 I wasn’t sure exactly what I wanted to do but I knew I wanted to work in finance in some capacity and from there I fell into arranging mortgages. Originally it was residential mortgages but I always found commercial property finance a lot more interesting, both in the work and the people I was dealing with.

I was doing this up until 2015 and when I left the company I was working with and decided to study property development myself and I even managed to complete a couple of my own projects. I was very cognisant of the fact that for someone like myself who had worked in the industry for 10 years at that stage, still found it very difficult to understand whether I had the best deal in the market. I thought “if I can’t understand it, then how is the average developer going to ever get close to understanding it?”.

I knew the challenges both as an intermediary of finding the best deal for a borrower, and being a borrower myself, and I saw the benefits that tech was providing to so many other industries, especially in financial services.

That was, effectively, the origin story of Brickflow and we’re now very much at the forefront of our industry in terms of technology and it’s one of the last industries anywhere to  adopt technology in one way, shape, or form. It’s still very archaic but there are some green shoots in the way that people want to work, which is really encouraging.

Keepers: Can you tell us about the platform and how it works?

Ian: 31 lenders plug into the platform at the moment and feed in their criteria and rates. The borrowers are then invited onto the platform where they state the requirements of their deals and the projects they want to fund, our algorithm matches the two. We then shortlist lenders according to who is the most likely to lend to you, what price they can lend at, and the amount that they would lend to you; these are estimates because every lender has their individual models, and at this stage they’d need more information about the projects.

Once we’ve shortlisted the lenders, borrowers are invited to select up to five different lenders to move to a deal forum where they add more information on the platform to tell the lenders more about themselves and the project to invite them to submit a final bid. Once that’s done, one of the bids can be accepted and they move forward with the application on the platform.

Keepers: It seems like every industry has its leaders when it comes to disruption, and lending is actually leading the way in many ways. But it seems that tech hasn’t touched this type of lending yet. What has the reception from the market been like?

Ian: It’s been really good, there’s nobody in the space who we’ve spoken to that doesn’t think that it’s a good idea. Although. there’s a big difference though between having a good idea and creating a well-executed business.

The industry is crying out for a solution like Brickflow, both on the borrower and lending side. We always ask questions to lenders who want to come on the platform and one of those is around hit rates of applications. Typically, they say, it's 1 in 25 applications that get complete which means that 96% of inquiries go nowhere.

There are two issues here. Firstly, there is a lack of knowledge from the borrowing side as they often don’t know how to approach lenders or have any idea whether they can borrow from them. Secondly, is the presentation of information as there are often issues between the borrowers and lenders. The lender gets frustrated with the borrower and how they present their situation, because they don’t know the questions they need to answer. There is normally a 2 – 3 week protracted period where the lender is trying to extract enough information to understand whether they can do the deal.

Our platform is trying to solve that pain for both sides because the power comes from getting quick visibility of the market to understand what’s achievable. Rather than borrowers going onto 30 different websites trying to find a lender, they can go onto our platform and have instant visibility of what is achievable and have that loan approved in 48 hours – our quickest loan credit approval is 4.5 hours.

Keepers: How has it been so far?

Ian: We launched officially last year on October 31st and had a beta phase for about 6 months. When you launch something new you’re always apprehensive, it’s a mixture of excitement and fear about how it’s going to be received. We spent a lot of time with lenders leading up to the launch who were excited about it but that doesn’t help when you approach launch day.

We didn’t come to market with the perfect product and, I think, you very rarely do. The last 7 – 8 months have been hugely valuable in learning what people like about your product because concept and reality are very different things. We’re starting to build the team now and we’ve got some funding to be able to sustain these things and build the tech into a better version of itself.

Keepers: An interesting point about the product. One thing that always comes up from successful founders is that they take the feedback from the users to constantly improve the product. You might go to market with a product that you think is perfect but the users might think otherwise. Can you tell us about the team?

Ian:  There’s the tech team, the developers, who are part of the founding team, Hugh Buxton & Robert Lange, who have created the platform. Then we’ve got our FD, Barry Lewis, who was actually my accountant and has been with us from the start. There’s Matt Guard who’s worked for an Australian lending platform that has been through early stage start-up phase and who went through their hyper-growth stage as well. We’ve also had a few consultants who have been great, and while they don’t have direct involvement day-to-day they have been very plugged into our journey and have been really important to geting us to where we are at the moment.

Keepers: What are the typical characteristics that you look for in new people joining?

Ian: The biggest thing for me is that people are organised and that they are self-starters, which is key because we are remote as a business. We are fully remote now, but it wasn’t always the plan, we did have  an office but when we launched the beta phase the first lockdown started about a week later! We challenged ourselves to see how long we could be fully remote as most of our development team are remote anyway and it’s worked out really well so far.

Some of the other things that I like to see are people who are problem solvers, who have been through this journey already or people who are better than me!

Keepers: Completely agree, surround yourself with people who are better than you or compliment your weaknesses. If we move onto the investment, you recently raised a £400k seed round, can you tell us about that round?

Ian: What we said to the investors was that there would be an 80/20 split between tech and growth. Our product is not perfect but it’s not an MVP as it has people coming through the platform and complete transactions.

We’re revenue-generating which I think was comforting for the investors. One of the investors said that we were one of the only companies she’d seen that wasn’t just a drawing on whiteboard, and that we derisked it for her. We spent three and a half years bootstrapped before we approached investors and we’ve built a product that works which will, hopefully, result in easier raising in the future.

Keepers: Blue sky thinking, what is the ultimate goal for Brickflow?

Ian: We are trying to democratise the industry. People know how to invest in residential properties and there are lots of ways to do that but when it comes to commercial property, like raising a mortgage against a hotel for example, where would you even think of starting?

There’s lots of change on the horizon and there are some exciting trends like being able to tokenise real estate, equity crowdfunding, etc. One of our big responsibilities is to keep up with the changes in PropTech as there’s so much awesome stuff on the horizon. You can view most properties online using a virtual tour in a 2D environment but very soon that’ll be 3D using augmented reality. Suddenly, we go from a microenvironment where we would invest in a property we can travel to on weekends to actually being able to invest anywhere on the planet within a matter of minutes.

Why is it that when people want to raise a deposit for a commercial mortgage that they have to fill out a paper application, go to the bank in person, and then wait up to 6 months? I think this area of finance is still so far behind, which represents a huge opportunity for us.

We want to involve more people and we see that as a key responsibility of ours to allow, for example, younger people who are being denied the opportunity to be able to invest their money into property. If we democratise that ability to make it as easy as possible to invest your own money and manage your own investments, then that would be an outcome that we’d be very proud of.

Keepers: You’re a first-time founder and you’ve been working on Brickflow for the more than 3 years, what one piece of advice would you give from what have you learnt in the last couple of years?

Ian: I think about this when I write the book in my head. The biggest thing is that whatever amount of grit and determination that you think you’ll need, double it, and then times it by 10; it really is a lot harder than people think.

I listen to podcasts featuring founders and one I listened to recently had the guy who founded Peloton which was really interesting because he said that he knew that he had a guaranteed unicorn, but nobody else could see it. He went to over 200 VCs and private equity companies before someone actually took a bet on them, which shows how much grit and determination you really need.

I feel like what we’ve done already, building a product that works, is the hard part but actually, I think it might actually be one of the easiest and I think it’s the scaling and distribution of the product where the biggest challenges are going to be. Every day you’ve solved a problem and put out a fire then 10 more jump out, but I guess that’s one of the fun parts.

That’s why you need lots of grit, determination, and belief that what you’re doing is correct. It’s so tough and you need to believe in the principles; we’re trying to build a legacy and democratise something, not looking for a quick buck, so it’s imperative that you stick to your principles.

Keepers: Thanks, Ian!