GLI Finance (GLIF, a specialist lender to small and medium sized businesses, has invested over £2 million in Platform Black, a rapidly-growing crowdfunding platform.

The investment is in the form of equity and preference shares, in return for 20 per cent of the company.

Platform Black enables SMEs to get access to the money tied up in their invoices by auctioning them online to investors seeking attractive short-term returns.

SMEs auction their invoices, while  controlling of all of the costs, to investors who compete to deliver the lowest cost of finance.

Platform Black has advanced around £21 million to SMEs to date, and delivered net annualised returns of 12-15 per cent to investors.

Speaking on the deal, Geoff Miller, CEO of GLI Finance, said: “This investment is a perfect fit within our strategy of focusing on niche lending to SMEs and enables us to add short term asset-based debt to our portfolio, while continuing to reinforce the geographical diversification of our business.

“We are delighted that Colin Levins, Louise Beaumont and their team have chosen to partner with us, and GLIF looks forward to building on this investment by trading on the platform, as well as investing in the business.”

Also commenting on the deal, Colin Levins and Louise Beaumont, co-Founders of Platform Black, said: “We are excited to have GLI Finance as a significant investor and partner in our business. In 2012, in the UK alone, the invoice finance market was worth £254 billion.

“This, together with a gap in SME funding estimated to be between £84 billion and £191 billion by 2018, means that there is significant and growing demand for our services. There are excellent synergies between GLIF’s other platforms and our business and we look forward to working with Geoff and his wider team.”