Evaluating Ethical Crowdfunding Investments with Triodos

Triodos is a very interesting company for the Ethical Impact Investor, it’s a whole eco-system of sustainable financial products that have enabled individuals and organisations to use their money in ways that benefit people and the environment.

From bank accounts to investment funds.

This review is focusing on my impressions of their Crowdfunding platform as an ethical impact investment available to everyday investors.

Investment options

At the time of this review there were 12 fully funded investments, from £300k to £7.5m (the 7.5m was over-funded to just shy of £10m, this was in partnership with Abundance Investments reviewed here).

Bonds

There were 2 bond options and 1 equity investment option.

The 2 bond notes were 5% and interestingly inflation linked. Which was something quite common in decades past particularly in the US, but not something I’ve come across much these days. I suppose the nature of solar projects is upfront investment so capital is in today’s terms, with returns in the future. They were also both eligible for the Innovative Finance ISA (third ISA option), which typically are not protected, but means any gains are tax free. This could make the 5% return comparable with much higher returns (e.g. 10% – 3% tax -2% inflation).

Equity

Having already a few bonds, I was keen to explore equity options.

The offering on the equity side was Fishtek Marine – it has an exciting proposition, basically focusing on reducing accidental catches in the fishing industry. With their flagship a “pinger” which emits a sound that alerts dolphins or whales to avoid the nets, with claims of 80-100% reduction in accidental catches.

  • £675,950 of £900,000 7 days left 75% raised for 15% of the company
  • With SEIS (first £150k) and EIS availability.
  • Minimum investment £1,000
  • The minimum raise of £400,000 had been reached.

Once again, the minimum investment was a constraint. An everyday investor, in my opinion should diversify, so with £1,000, it is just not feasible for most.

The two bonds available had a minimum investment of £200 and £500, so again, difficult for an everyday investor to justify and maintain a diversified portfolio. Perhaps a more viable option is their Pioneer Fund, which has a minimum of £1,000 and top up options of £500. I may look to review this at a later date.

Overall, at this stage, this is an investment platform that is not set up for someone like myself, but they are an interesting prospect and certainly one to watch for the future as they develop.

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