When Graham McClelland, the youthful and quietly intense chief executive of Gen H, arrived at the City of London office of the fast-growing mortgage lender four and a half years ago, the company had no revenue, no balance sheet to speak of and no certainty that its radical proposition would ever gain traction.
Today, Gen H expects to generate around £10 million in revenue this year, has grown more than 800% in four years and has become the only residential mortgage lender to appear in Deloitte’s Fast 50 ranking of UK technology companies.
Not bad, he suggests with a smile, “for a business that started at zero”.
Gen H was founded in 2019 with a bold if unfashionable ambition: to make home ownership possible for many more people in a market where affordability is spiralling, the social rented sector is diminishing and tens of thousands of would-be buyers find themselves locked out.
For McClelland, who joined not at the beginning but after seeing the model and the mission, the scale of the problem was so obvious it was almost overwhelming.
“You don’t have to look very far to see the problem of home ownership,” he says.
“We don’t have a particularly good rental sector in the UK – you don’t have certainty of tenancy – and the concept of council housing is dying away entirely.
“So what are people left with? Substandard accommodation or home ownership. And if ownership rates are falling, you’re creating a real problem for society.”
Before joining Gen H, McClelland worked in investment banking, where he saw the affordability crisis playing out among well-paid colleagues.
“When even people in their twenties joining investment banks – people who are well remunerated and often come from decent backgrounds with help where they need it – are struggling to buy, you really understand how big the problem is.”
It was, he says, the urgency of the challenge that attracted him to Gen H’s founders and convinced him that a new kind of lender, designed from first principles, could actually make a dent in a housing system “everyone agrees has so much scope for improvement”.
“What we said was: there’s a group of people who don’t have a mortgage provider. We think that’s wrong. Let’s go and support them”
TAKING ON THE BANKS
Launching a mortgage lender from scratch might sound extremely idealistic in a market dominated by household names with vast balance sheets and sizeable compliance functions. But Gen H never planned to out-Halifax Halifax or beat HSBC at price.
“We weren’t trying to compete with the big banks,” McClelland insists.
“You’re not going to out-HSBC HSBC. What we said was: there’s a group of people who don’t have a mortgage provider. We think that’s wrong. Let’s go and support them.”
That clarity of purpose, he says, created a culture of belief – a word he comes back to repeatedly.
“Everyone believed we could do this. Maybe that’s arrogant, and there was definitely some naivety. We didn’t fully appreciate how hard funding would be. But everyone inside the business could see the problem. And when you see something that big, you kind of think: OK, we can fix this.”
The belief, he says, has helped build an unusually stable team for a tech-led financial startup.
“Our core leadership group – most of them have been here three or four years. A lot of them predate me. In tech startups, staff turnover is normally high, but our engineers, our mortgage teams, our operational teams – they’ve been here a long time.”
Even in an industry as traditional as mortgage lending – one McClelland describes with a mixture of fascination and disbelief – Gen H found that doors opened easily.
“One of the best things about the mortgage industry as an outsider is that everybody agrees there’s a lot of scope for improvement,” he says.
“People aren’t shocked when you say things could be done better. They’re interested; they’re intrigued.”
Not everyone, he admits, shares that appetite for change. He recalls meeting a senior lending executive at a major bank who dismissed Gen H out of hand.
“He literally said: ‘I grew my market share from 17.1 to 17.7. I don’t care about anybody else.’ That was the whole conversation,” McClelland laughs. “I was like: ‘Great. Thanks for your time.’”
But he stresses such attitudes are rare. “That tends to be the bigger banks and some more traditional building societies. Everyone else wants to talk.”
BUILDING FROM SCRATCH
If Gen H has a defining feature, it is the decision early on to build its entire mortgage platform – from broker portal to servicing engine – in-house.
It wasn’t, McClelland insists, a theological decision. “We didn’t start out saying: we’re going to build everything. We went out to see what was available. We looked at what was out there and thought: actually, nothing gives us what we need.”
What they needed, he says, was the freedom to innovate quickly, launch new products, resolve bottlenecks overnight and avoid the spaghetti of legacy systems that characterise much of the industry.
“It blew my mind as an outsider that some lenders key a case in two or three different systems. It’s mind-blowing. So our platform takes all of that out. Our data is fantastic – which is incredibly helpful for consumer duty and just for serving customers well.”
Building the mortgage engine, he says, was “a really, really good decision”. Building the servicing platform was “much harder”. But it has paid off.
Sara Palmer, Gen H’s new head of distribution, sitting alongside McClelland during our interview, adds that the technical autonomy is a game-changer for brokers.
“This is like being in control of your own destiny. If the market moves and we need to adapt, we can just go and do it,” she says.
Gen H’s Slack channels are filled with daily product changes – tweaks, improvements, refinements – all informed by broker testing sessions and user feedback.
“Every day there’s something making the platform better,” she says. “Brokers tell us the journey is good because we’ve actually designed it around them.”
“We could do £2bn of lending with pretty close to the same team, because tech can make the process so much more efficient”
HARD LESSONS
Gen H’s 837% revenue growth over four years is headline-grabbing but McClelland is quick to remind that it grew from a base of zero.
“When I joined, we had no revenue. Nothing. The funding model then didn’t even pay us upfront for the lending we were doing. So we were making no money whatsoever.”
Last year the firm lent around half a billion pounds. And McClelland believes they can quadruple that without anything like a proportional increase in headcount.
“We could do £2 billion of lending with pretty close to the same team, because tech can make the process so much more efficient.”
The key, he says, has been proving the performance of its lending and building trust with funding partners, all dual-regulated institutions subject to FCA and PRA oversight.
“They feel they’re getting something from us they can’t do themselves. And we’re getting paid to do that.”
CUSTOMER OUTCOMES
Just days before our sit down in Liverpool Street’s Rake’s Café Bar Gen H was recognised as one of the UK’s fastest-growing technology companies, placing 38th in Deloitte’s 26th annual UK Technology Fast 50. The company is the only residential mortgage lender to feature in the list.
Yet McClelland plays down awards as motivation.
“Speaking candidly, we don’t really care that much about awards. The thing we care about is people getting homes. Every time someone gets keys to a house they wouldn’t otherwise have got – that’s the award.”
Still, he acknowledges that external recognition has value. “It’s nice for the team. It’s nice for people to look in and say: you’re doing a great job. We’ve been so inwardly focused that we haven’t really stopped to say: actually, we’ve done some pretty cool stuff.”
BALANCING AGILITY WITH RIGOUR
One of the toughest challenges for any fast-growing fintech is governance. Many scale quickly only to be tripped up later by compliance failures. McClelland insists Gen H is determined not to fall into that trap.
“We take our regulatory responsibilities very seriously. But the challenge is real. What a team of 100 compliance staff at a big bank can do, we have to do with three. So you have to think differently.”
Part of the challenge, he says, is hiring. Recruit someone from a large bank or regulator and they may come with a mindset ill-suited to a company moving at speed.
“What we found is people used to big institutions want to go really deep on something for a month. But everything is moving so fast – that’s not helpful. Our model is regular, targeted dives into different areas. Surface issues early, make adjustments, improve.”
Gen H uses external auditors, runs frequent second-line checks, and undergoes rigorous testing by funding partners.
“They bring in external audit firms to test our lending. The feedback is always positive and where there are learning areas, we take them on.”
“I’m a big believer in AI. But I’m not signed up to the idea of AI underwriting doing everything in the next 12 months. That’s not realistic”
EMPOWERING UNDERWRITERS
Few subjects animate McClelland as much as artificial intelligence. He is an evangelist, but not, he stresses, a fantasist.
“I’m a big believer in AI. But I’m not signed up to the idea of AI underwriting doing everything in the next 12 months. That’s not realistic.”
Instead, Gen H is deploying AI in two focused areas.
First, packaging and document analysis. This, he says, is the biggest bottleneck in complex lending.
“You don’t get everything you ask for. And what you get raises questions – that’s underwriting. The machine now checks if documents are correct. You’d be amazed at how often they aren’t.”
More importantly, the system anticipates follow-up queries.
“The AI will go: whenever we get this document, we always end up asking for that. It surfaces it straight away so underwriters can do the valuable stuff – assessing income, sustainability, complexity – rather than chasing documents.”
And second? Quality assurance. The second big use case is QA and QC.
“At the moment, QA is human-intensive. One in ten calls, one in 50 cases. The machine can look at all of them and tell the humans which to check. That’s the next step.”
The result, he says, is the ability to scale while protecting customer outcomes.
THE GEN H BOOST
One of Gen H’s flagship innovations is New Build Boost, a product often described as a private-sector alternative to Help to Buy. The model allows family or friends to contribute funds that enhance affordability for first-time buyers.
According to McClelland, it is already gaining traction. Persimmon, one of Britain’s biggest housebuilders, highlighted the scheme in its latest results as a significant driver of footfall and completions.
“It’s not meant to be for everybody,” McClelland says. “But it is a way to get a group of people who want a home, and struggle with affordability, into ownership.”
Volume is growing steadily, and the lender has a pipeline of builders seeking to join the programme.
Critics of Help to Buy argued it inflated house prices and funnelled taxpayer money into developer profits. And McClelland does not dispute those criticisms.
“Anything where taxpayers underwrite risk for another industry creates a challenge. The intentions were right but the outcomes sometimes weren’t.”
Boost, he argues, avoids the pitfalls because it is privately funded, targeted and structured to support buyers rather than developers.
THE ROAD AHEAD
Gen H will not replace the big banks, McClelland says, nor does it need to. But the company’s ambition is clear: scale lending rapidly, use technology to drive efficiency, deploy AI judiciously and expand access to home ownership in a system he believes is failing too many.
“We’re not doing much vanilla lending,” he says. “If you want a simple mortgage, you’ll get a great deal on the high street. What we do is serve the people who fall outside those boxes.”
The goal is simple, he says. “People in homes. That’s it.”
