Founded in 2018, New Silver is a technology-enabled non-bank lender primarily focused on providing real estate-backed financing for the United States “fix and flip” sector with a concentration on single-family residential assets. Bridge loans, also referred to as fix and flip loans, allow real estate investors to finance both the purchase and the construction, or in some cases, refinance an existing investment property with sufficient equity.
|Company Name||New Silver|
|Asset Type||Short term real estate bridge loans|
|Pool Summary||NS Series 2|
Please give a brief history of the company and, if applicable, group structure.
New Silver provides a variety of 1st mortgage loan solutions ranging from acquisition/construction loans to 30-year permanent financing for stabilized assets. New Silver is heavily concentrated on shorter term bridge/”fix and flip” products with 12-24-month terms. This pool will be generating interest against collateralized bridge loans.
Please give an overview of the legal structure.
New Silver Lending LLC (“New Silver” or the “Asset Originator”) has launched NS Pool LLC (the “Issuer”), a Delaware limited liability company, which will offer for sale to investors tokens, corresponding to certain payment obligations owed to the Issuer by various real estate developers.
How many full-time equivalent team members do you have and what do they do?
We have 5 full time team members. The New Silver co-founders, Kirill and Alex, have known each other for many years. Over the last 20+ years, Alex has worked his way up to a CFO at a large commercial real estate operation in Connecticut. Kirill has started and exited a number of technology companies. The third team member and CTO is Alexey Shevchenko. We also have 2 additional team members in the marketing department, and are actively hiring people in sales and tech.
Have you sold equity? Are you venture funded, if so please describe the previous rounds, money invested, and lead investors.
We have not raised institutional capital, we raised around $500k from the founders.
Describe the asset collateral that you seek to finance.
Real estate bridge loans
Describe your previous track record related to this business proposal.
To date, the company originated over $35mm loans and had no foreclosures. Prior to Covid19, the company was originating $3-5mm per month, and took a pause during the pandemic to assess market risk. As of the date of issuance, the management team is confident in the single family residential (SFR) sector - consumer mortgage rates are at all-time lows, mortgage applications are near their all-time highs and increasing while home mortgages in forbearance are decreasing and foreclosures for the year are lower than in the past years. While the commercial real estate market may be temporarily affected by the pandemic, the management team feels strongly that the SFR market is substantially different and will continue to have a scarcity of supply thus driving demand and price appreciation. New Silver anticipates originating up to $50M in the next 12 months.
What is the average collateral asset size?
Average Loan Size: $190.000
Describe the risk of the assets you are proposing. How do you evaluate and manage that risk?
This is a non-exhaustive list of potential asset specific risks that are described in detail in the executive summary: general real estate risks (e.g. fluctuations and cycles in performance), borrower default risk, failure to recoup full value of the underlying asset in foreclosure, risk of lack of knowledge in certain geographic areas, environmental risks, lack of geographic diversification
Please describe any conflicts of interest or potential conflicts of interest or any relationship that could compromise or be viewed to compromise the decision making of the company.
Are there or have there in the last 10 years, been any criminal, civil, regulatory or administrative proceedings against (i) the Company or any of its principals or (ii) the product in any similar such matters including reparations, arbitrations, and negotiated settlements? If so, please describe.
One of New Silver’s co-founders was involved in a blockchain project called Caviar in 2017-18. Caviar and New Silver are entirely different entities and have no business overlap. Caviar performed a compliant fund-raise outside of the United States, reliant upon Reg S exemption from registration. Due to political sentiment towards cryptocurrencies the state of Massachusetts targeted many blockchain startups - Caviar among them. The sole allegation the state could bring forward was that Caviar had conducted “offering” improperly and targeted MA residents by social media advertising. Caviar’s marketing company, while excluding the U.S. and a number of other countries from their ads, did not turn of re-targeting to US users which caused the state to make this claim. As this was the sole allegation and no further action was taken, Caviar decided to settle in February of 2019, paid a fine and agreed to refund any investor from the state of MA (of which there weren’t any). As a result, the founders also decided to close Caviar and provided refunds to all investors. This has no bearing on business activities today and in the future.
Are there any further disclosures that interested parties should be aware of?