JBR Capital: accelerating the high-end vehicle financing market
Summary
Through a combination of a highly personalised approach and key strategic partnerships and channels, JBR Capital has immersed itself in the high-performance automotive community.
They understand the special relationship and passion that their customers have for their high-end dream cars and see their role as facilitating that dream and passion for luxury vehicles. Through this unique relationship, JBR place the customer at the heart of the business, from onboarding through the entire customer journey.
Chris Seaward, Chief Operating Officer at JBR Capital notes that, “at JBR we understand that the emotion for high-value cars exists with our customers and we are happy to help them achieve what they want to achieve.”
Rapidly developing relationships within their multi-channel network of dealers, brokers, franchises and direct customers, JBR Capital have achieved a reputation within the auto finance sector as the only specialised UK independent lender of high-value cars (from £25k to £750k) in the regulated and non-regulated space.
Building on significant momentum since the business was founded, JBR Capital has accelerated over the last 12 months – 2022 being the company’s most successful year with £279 million in lending alone – surpassing £1bn of lending since their inception in 2015.
Their growing business has seen their workforce rise from five to six ‘colleagues’ in 2015 to over 80 today. The maturing of the company allows them to look ahead and see growth for the future, aiming to repeat another £1bn in lending in just two years’ time by growing business across all channels.
Growth has been substantial and JBR has lofty ambitions. Over the past eight years, JBR Capital have shown that their model works, helping them to weather the economic challenges of Covid, Brexit, interest rate rises and rising inflation over the past few years.
“There is huge opportunity in our core business which we are looking to maximise all of the time.”
Multi-channel approach
JBR Capital operate through a multi-channel network – dealers, broker channel, franchise network, and direct to customer – and are constantly expanding all channels to reach their targets.
While these individual networks are all important to JBR, the strong broker market is the largest distribution channel with business soaring following the Covid pandemic. JBR also see significant future growth from the franchise channel presenting a big opportunity for expanding the market.
JBR works with its loyal introducers to maintain a ‘customer for life’ philosophy. As Chris Seaward notes, JBR’s introducer partners are strategic partners in the long-term vision of the business, and “the relationships with introducers are really important and the backbone of what JBR is built on.”
“Our introducer partners are our strategic partners in the long-term of the business.”
JBR believe that the direct to customer route is a more passive channel for JBR and will increase as the company grows and the brand becomes more visible through a number of initiatives:
- Tactical marketing and PR strategy
- Connection with luxury car enthusiasts by partnering with sector organisations and clubs
- Car shows – supporting the community and demonstrating JBR’s expertise in the sector
JBR Capital’s expertise and knowledge in high-end cars and customers in this niche market is very prevalent and they are seen as the main expert in the field. As Chris Seaward confirms, “As the business grows and becomes more capable and more credible and can deal with larger volumes, we will have an increased appetite to talk to a range of people about where we can help them with financing options.”
JBR see one of their key strengths as continuing to be independent and brand agnostic so that they can serve the whole market rather than specialising on any particular sub-segment.
Product range
JBR offer a limited range of regulated and unregulated products which fit perfectly with their clientele’s financial objectives – fixed and variable rate loans and hire-purchase products (with and without a balloon payment).
New mobility finance solutions including pay-per-use and subscription products are not offered by JBR Capital as they feel that they won’t work effectively in their niche sector and will not suit the needs of their traditional-style customers who, as enthusiasts who want to love and own their car, want the pride of ownership.
As Chris Seaward highlights, “We have a specific niche market of customer who love their cars and love to own them and I don’t see the subscription model coming into this space in the near future.”
Value-added products
Currently JBR Capital do not offer any value-added products, but with a growing client base and a solid foundation, JBR are always interested to explore different revenue-generating opportunities and partners who can complement their existing platform.
However, with only a 5% market share in their current market segment, JBR’s main focus is to grow and increase their market share in the lending space in their core business. In the future, they see a huge opportunity in generating revenue through additional value-added products and partnerships.
JBR have a platform where customers can advertise their cars for sale. This is an additional customer service offering. JBR do not own the cars and do not offer a wholesale stocking facility.
Customer relationships
Digitally enabled onboarding with a human touch
JBR Capital are a digitally enabled lender with a human touch; a business that fully understands the special relationship that their customers have with their cars.
The JBR onboarding process is a mix of manual and digital. While they use digital interfaces and APIs, the key differentiator between JBR and other lenders is that they perform manual underwriting. While they have the ability to have automated decisions as a guideline for underwriters, they also have a manual process so that they can understand the ‘real’ risk and opportunity.
JBR operate a rate for risk criteria where each introducer has a price banding from JBR with a fixed commission.
JBR Capital currently have access to sufficient wholesale funding arrangements to enable them to exploit their growth ambitions and to help them meet their aspirational target of £1bn in the next two years. This lending comes from a number of sources: senior lenders, mezzanine lender and a private facility, and in the future JBR will hopefully look at a public ABS transaction.
Good customer experience
For repeat customer business, JBR will direct the client back to their original source channel to maintain a consistent customer experience and seamless journey. JBR can boast excellent levels of customer retention, especially through their broker and direct channels, with strategies in place to retain customer loyalty.
A key strategic project for the future of JBR Capital, according to Seaward, is a JBR customer portal, enabling customers to access their account digitally and therefore further enhancing the customer relationship.
COVID
During the turbulent times of the Covid pandemic, JBR Capital followed the necessary regulations and witnessed a good experience throughout with their customers, resulting in few negative outcomes.
The company offered payment holidays, which had a relatively small uptake of approximately 20% of their book during the peak of the pandemic in 2020.
Seaward highlights the needs during this time to liaise with funders, implement new processes and educate the work force. He believes that learning how to react and re-engineer processes during this time tested JBR as a business, but it was a challenge that provided a good learning experience.
Consumer Duty
At JBR Capital, the customer is at the heart of the business and customer service is particularly important. As such, JBR are effectively adhering to and are fully compliant with the new Consumer Duty guidelines.
According to Seaward, JBR want to fulfil the spirit and letter of the Consumer Duty regulation, with the guidelines embedded in the DNA of the company.
Plans for Consumer Duty at all levels of the business were formed four to five months ago and are now fully implemented throughout the whole business. Raising the standards from TCF, Consumer Duty can be found throughout the entire end-to-end customer journey.
“Consumer duty is in the DNA of the company.”
JBR are proud members of the Finance and Leasing Association.
ESG credentials
JBR have implemented their ESG programme over the last two years, making excellent progress across all divisions.
Launching an industry standard-setting sustainability initiative in 2022, JBR Capital partnered with Carbon Neutral Britain by offsetting 5,000 miles of carbon emissions for each car financed by its clients, greatly reducing the environmental impact of high-end vehicle ownership.
The programme allows JBR to offset the carbon emissions of the first 5,000 miles in the first year of ownership for the client and the client can then sign up to the initiative for subsequent years.
Previously focusing on Scope 1 and 2 emissions where JBR have offset all business emissions, the sustainability initiative looks at ‘sold services’ under Scope 3 emissions by offsetting customers’ carbon emissions, an example of JBR’s responsible lending approach.
Seaward highlighted that JBR have a rightful obligation to do this for their clients and the planet when they finance cars that omit the most carbon. JBR’s initiative is also in line with their specialist financial services private equity investor, Cabot Square Capital, who have a strong demand for ESG strategies in their portfolio companies.
Other ESG strategies include engaging with two local charities – City Harvest and Talent Rise – to stay connected to the local area in which JBR can try to make a difference.
This philosophy continues into the JBR workplace, with employee-led initiatives in D&I, mental health awareness, wellness champions, and various workshops. Seaward emphasised the importance of a positive culture at JBR Capital, in order to retain staff in a niche marketplace and have an engaged workforce, which translates to an engaged customer.
“We’ve tried really hard at JBR to build a positive culture to retain our staff as the niche expertise we have is really important to us.”
