September 09, 2017
Crowdfunding and sustainability fit together seamlessly, says Coenraad de Vries, co-founder of Oneplanetcrowd: “Sustainability is a complex transition that can only succeed through collaboration. Financing is an enormously powerful tool to create that solidarity. ”
Coenraad de Vries founded the investment company StartGreen Capital in 2006. The goal was simple: to finance as many sustainable innovations as possible. This resulted in the management of two venture capital funds and two regional energy funds, for Overijssel and Noord-Holland.
When crowdfunding first emerged in 2012, De Vries and co-founder Laura Rooseboom decided to set up Oneplanetcrowd. The first and now largest Dutch crowdfunding platform, with a focus on sustainable companies, innovations and initiatives. De Vries: “Crowdfunding was a perfect match for what we wanted to achieve: financing things that yield both financial and sustainable returns. That is why we decided to innovate ourselves and also introduce this financing instrument in the Netherlands. ”
What did you hope to achieve with the creation of Oneplanetcrowd?
“We found that as investment funds we often had to say 'no'. This is because funds often have a very specific focus or are limited in terms of region. Our venture capital funds, for example, only focus on sustainable technology companies. But sustainable innovation comes from many more sides. Think of partial propositions or new energy parks; they are then left out. We therefore saw crowdfunding as an additional financing instrument that makes it possible to finance many more sustainable innovations. ”
“We never expected it to become this big. We saw crowdfunding solely as an additional financing instrument, but it has now grown into a complete financing solution for many companies. Five years ago you were happy when you raised € 25,000 through crowdfunding. Now amounts of € 500,000 are very normal. ”
Where does that popularity come from?
“More and more people want to invest in an environmentally conscious manner. They want to make sure that their money is spent properly. In addition, financial returns are of course also very important. Crowdfunding offers both. ”
“Second, you notice that the do it yourselfmentality is emerging. New generations are now so used to making their own choices that they also figure things out and arrange things themselves. I no longer go to a travel agency to book a weekend in Barcelona. I arrange my flight, my overnight stays and my travel schedule myself. This trend is also underway in the world of investing: people want to gain more control over where their money goes and give it their own signature. ”
“Thirdly, crowdfunding provides a direct match between the investor and the company looking for investment. This removes some expensive intermediaries from the financial chain, which ensures a better return. ”
What are the advantages for companies to get started with crowdfunding?
“Thanks to crowdfunding, a company not only receives the financing it is looking for, but immediately creates a community, or crowd. This is important. Suppose you are developing a sustainable energy project, it is essential that you involve the region in the project. Crowdfunding is the way to achieve that public participation. After all, you make people co-owners of the project. ”
“It is also a powerful marketing tool. Snappcar called the first crowdfunding campaign on our platform their most successful marketing campaign. That's because everyone who co-financed the project also became a customer of Snappcar. ”
“More importantly, anyone who co-finances a project tells at least ten others. The exposure of the project is increased tenfold. So with crowdfunding you not only create a community, you create ambassadors. "
Are there also risks with crowdfunding?
“Of course. If you put your savings in a savings account, the risk is of course a bit lower. Crowdfunding is therefore certainly not an alternative to saving or investing on the stock exchange. It can be an additional form of investor, which gives extra sustainable returns to your investor portfolio. ”
“It is then important that private investors apply crowdfunding properly. Our advice is therefore the '10 out of 10 'rule. We recommend that private individuals do not invest more than 10 percent of their freely investable assets in crowdfunding. In addition, we recommend spreading the risk by investing in at least 10 different companies. Investors must of course also read the information of a project carefully before investing. ”
"Alternative forms of financing, such as crowdfunding, are only getting more popular and bigger"
What will crowdfunding look like in the future?
“Alternative forms of financing, such as crowdfunding, are only becoming more popular and bigger. In the UK, for example, things are moving very quickly. There you see that successful crowdfunding platforms also become marketplaces for larger funds. In some cases even pension funds. This trend is slowly but surely also becoming visible in the Netherlands. Professional investors are increasingly using crowdfunding to build their own portfolio. Where we with direct matching (crowdfunding, ed.) are large quality platforms, where private and professional investors can jointly purchase themselves in energy projects or innovative companies. ”
“I expect that trend to continue and to occupy a strong position in the financial landscape. But always next to banks and regular forms of financing; that will never replace crowdfunding. And that is not necessary at all. Remember the 10 out of 10 rule: the rest of your assets are simply invested in banks. ”
“That does not detract from the impact that crowdfunding can make. The total savings balance in the Netherlands is estimated at approximately € 340 billion. Ten percent of that is € 34 billion; you can use that to finance a lot of sustainable transitions. ”
What needs to be done to enable crowdfunding on such a large scale?
“You can see that there are currently a lot of discussions about crowdfunding. That's okay too. It is a relatively new phenomenon and you have to take a critical look at it all together. The early adopters have been doing it for a while, but crowdfunding is now in the exciting transition phase to early majority. You just need a few years for that. Major changes are rightly always accompanied by prudence on the part of individuals. Online shopping is the norm nowadays, but it took ten years to get there. ”
“The early majority wants the same as early adopters, but does require a certain degree of certainty and also wants to have the correct information. This is only possible if there are good regulations and the pioneers professionalise. Then the chaff is separated from the wheat automatically. That is why the members of the European industry association of crowdfunding platforms, for example, have decided to communicate their performance every quarter in anticipation of the regulations. You build trust with that. ”
Why do crowdfunding and sustainability go so well together?
“Sustainability is only possible through collaboration. It's a complex transition and people realize that. If you want to create that togetherness, financing is a very powerful tool. You involve all stakeholders on the financial side. With that you not only share the costs, but also the financial benefits. You really do it together. ”