International Inspiration & Home Truths: Sports clubs

Our series “International Inspiration and Home Truths” shares some of the crowdlending stories we’ve heard from far and wide, brings that inspiration back to Aotearoa and hears from the enthusiasts who’ve helped us to imagine what crowdlending could look like for a range of kiwi organisations. The next type of organisation spilling over the top of our box of inspiration is sports clubs.

Sport is an essential part of many of our lives. A good chunk of us build our identities around the sports we play, watch and follow. Whether it’s rugby or racing, surfing or squash, there’s a little bit of us that belongs to that sport. Our team are no different: for Tan it’s tennis, for Kelsey it’s football, for Barry it’s futsal and for Anna…well, is cheese a sport?

At the core of our sporting-lives is a community of people that get the same buzz that we do ourselves – club members that get such joy out of being involved with and having a sense of ownership over our clubs. Sports clubs are constantly building crowds of members, players, fans and followers.

So have sports teams borrowed from their crowds before? Indeed they have. German football club Hertha Berlin F.C. broke crowdlending records a year ago when they raised €1million in ten minutes from their fans and members. As part of their “Hetha 4.0” strategy, they wanted to refresh their online identity and become the most innovative and inclusive club in Germany.

It’s not just big professional outfits that crowdlending can work for. Fin McCool Surf School on the shores of Donegal in Ireland borrowed €20,000 from their crowd to refurbish their clubhouse last March.

What could happen closer to home?

Imagine, a kiwi surf lifesaving club borrowing interest-free from their members to refurbish their wind battered clubhouse. Rallying their crowd to improve their common home whilst rewarding them by paying them back over time.

The enthusiast who’s inspired us

Geoff Lewis got us thinking about crowdlending for sports clubs when he and Anna crossed paths last year. He’s a proud member and President of Thorndon Tennis and Squash Club in Wellington.

Who are you, and what do you do?

We are the Thorndon Tennis and Squash Club.  As a tennis club, we were established in 1879 making us, we believe, the oldest tennis club in New Zealand.  Even Wimbledon started only a few years before the Thorndon Club! Our vision is to be a thriving, dynamic tennis and squash club in the heart of Wellington. To help achieve our vision, we are striving to upgrade our facilities, some of which are showing their age!  One important project is to upgrade our two existing lawn tennis courts into modern, high-quality playing surfaces for all-year-round use.

What do you think about crowdlending?

Upgrading our lawn tennis courts requires a substantial capital spend. We are hoping to fund this partly with grants from gaming trusts and partly with additional income from a larger member base and from using one existing court as a mid-week parking facility. To bridge the timing gap between the capital spend not covered by grants and future income, we think crowdfunding via loans from our members and supporters is the way to go.  Our lenders will earn interest on their funds, feel good about helping the club, and feel secure about getting their money back over time.

What are your concerns about crowdlending in New Zealand?

Crowdlending in New Zealand is still relatively unknown. At the same time, more stringent financial regulations in New Zealand require a professional approach to raising funds.  We think for a modest-sized sports club such as ourselves, it makes sense to use a crowdlending platform like PledgeMe to ensure that all the legal and technical boxes are ticked.

What excites you about it?

If crowdlending helps Thorndon Club to build two brilliant new tennis courts, and upgrade other facilities such as our four squash courts, it will be a very exciting achievement for us and for the inner-city community of Wellington who I’m sure make great use of them.

A little bit curious about how crowdlending can work for your local club? Chat to us!

What's Up Wednesday

Bicycle Junction’s New Community Hub!

Calling all cyclists! Wellington institution Bicycle Junction is on the move, and they want their new community hub to be bigger and better than ever.

Bicycle Junction started up four years ago, in the heart of Newtown. Its name came from the hope that the shop could be “a junction point in people’s lives where they are introduced to life by bike.” The team behind the shop see it as a place where everyone, cyclist or not, can be warmly welcomed, and become part of Wellington’s vibrant cycle-culture.

And as part of their mission to make Wellington a cycle-centric city, Bicycle Junction are moving and growing – and asking for your help. They’ve always supported their community, but now they want to build a retail and cafe space that can transform into a community venue by night, to give more back to the city and support even more people doing cool stuff.

To find out more about why you should be getting into gear with this campaign, we had a chat to community activator Catarina:

How are you finding the campaign so far?

We’re very excited about our crowdfunding campaign because it gives us a chance to take community engagement a step further. We’ve been pretty involved with various events in the past but when your community actually puts money up to help you realise a dream, that’s real validation.

What motivated you to reach out to your crowd?

We think our crowd is behind us 100%. And we don’t consider our crowd just to be cyclists. In fact, we don’t really like that word. We prefer people on bikes. But we also think pedestrians, coffee-lovers, students, families, and anyone who is in the area would love a bike shop/community hub like ours nearby.

What do you have planned for the rest of your campaign – anything for us to look forward to?

We’re excited to bring on reward partners such as Garage Project, Karma Cola, and other yummy goodness. We’re also working on a few ways to remember the old shop in Newtown. And finally, Dan wants to do some crazy stuff on a bike so stay tuned for what that might be! He’s nuts so this is really going to be outrageous!

Anything else you’d like to shout out to your crowd?

We love the new spot we’ve chosen and we will sorely miss Newtown but we don’t want this to be just a shop that only serves Te Aro (although Marion and Ghuznee will be THE place to be now!). We want to be ALL of Wellington’s bike shop and serve a growing community of people who want a more liveable and vibrant city.
We know how generous the people of Wellington can be and we hope they’ll continue to share that generosity through our campaign!

To support Bicycle Junction and get their wheels spinning, get pledging right here.

How does crowdlending compare to borrowing from a bank?

When it comes to borrowing money for your business or organisation, you’ve got a good handful of options. There’s a bank loan, there’s other peer-to-peer lending platforms and there’s crowdlending with PledgeMe.Lend. Steer clear of high-interest payday lenders or other disguised loan sharks – their high interest rates and hidden terms can end up putting you under severe pressure. And if you’re raising significant amounts of money, don’t use your overdraft facility or credit cards, because the high interest rates attached to them are meant to only be used to fill short term funding gaps.

One big question we get is: how does crowdlending compare with a bank loan and the other peer-to-peer lenders in New Zealand? How do they measure up when it comes to cost, time and benefits beyond the money. Figuring out what’s most important to your organisation will help you make the right call for you. Here’s our take on four important factors: cost, time, your chances of getting a loan and the benefits beyond money that you might want to see.

Cost

The costs of borrowing money come in a few different shapes. There’s the interest rate that you pay to your lenders. There’s the arrangement fees for putting the loan in place. And for crowdlending and peer-to-peer platforms, there’s campaign success fees and preparation fees to consider.

Let’s take a look at a 5 year unsecured loan of $200,000 (that you’re gradually paying back over time, as well as paying the interest) through PledgeMe.Lend, from a bank and through another peer-to-peer lending platform

PledgeMe.Lend

Total cost of $57,100

  • Interest rate of 8%
  • Interest cost over 5 years: $44,600
  • CrowdfundingU fee: $1,500 (½ of the $3,000 fee if you get it covered by capability vouchers)
  • Success fee (of 5.5%): $11,000

Bank loan

Total cost of $69,400

  • Interest rate of 12%
  • Interest cost over 5 years: $68,900
  • Arrangement fee: $500

Other P2P Lending (LendingCrowd)

Total cost of $76,550

  • Interest rate of 13%
  • Interest cost over 5 years: $75,100
  • Platform fee: $1,450

One other thing to consider is the timing of the different costs. The cost of CrowdfundingU will be upfront, as will the bank arrangement fee. The crowdlending success fee and the platform fee happen once your campaign is successfully funded, and they can be budgeted into the amount that you raise. The interest cost will be spread over the life of the loan.

Time

One other thing to consider is the timing of the different costs. The cost of CrowdfundingU will be upfront, as will the bank arrangement fee. The crowdlending success fee and the platform fee happen once your campaign is successfully funded, and they can be budgeted into the amount that you raise. The interest cost will be spread over the life of the loan.

What’s a reasonable expectation of having the money in your hands to go do the thing you want to do. From application to money in your account (if they give you the thumbs up) a bank will typically take two to six weeks to process your loan – they’ll carry out a business assessment and a household income assessment to help make their decision.

Other peer-to-peer platforms have quick self-assessment applications and (if you get through) you can have you loan campaign up live in a day or so.

For PledgeMe.Lend, our approach is more human-focused and takes longer. You can see if you’re ready to borrow in the space of five minutes by taking our self-assessment CRED. We’ll then chat to hear your story, see what you have planned and give you some hints to get your crowdfunding ball rolling. We’ll work with you one-on-one for six weeks to prepare your offer documents, map out your crowd and draw up your plan of how you are going to get your crowd aware, informed and excited. A typical lending campaign will roll for four weeks and we take up to two weeks to get the money processed and into your account. So all in, to run an effective crowdlending campaign, you’re looking at three months from start to finish.

Your chances of raising the loan

Banks can be quite selective – if you don’t own your own house and are willing to put it up as security, then your chances of getting a loan are pretty slim. Putting up your personal assets to secure your business’ loan is a big obstacle. And realistically, if you really want to borrow from your bank, you’ll have no choice over the matter.

Your chances with crowdlending depend more on the crowd that you’ve cultivated around you, how involved they feel and how well you can communicate with them. We help you to nut all of this out through CrowdfundingU. Showing that you can repay your loan by passing our CRED is the other hurdle for you to fly over.

Benefits beyond money

Ask yourself, what are the things that you want to get out of raising money beyond the money itself? Through PledgeMe.Lend the cost of borrowing may be lower, but the real power of crowdlending through us are the benefits that money can’t measure.

Do you want to have the final say over the terms of your loan? Is that element of control and choice important to you and your crowd? Do you want the return from your loan to line the pockets of an institution or people you don’t really know, or do you want the benefit to go to those you do? Do you feel uneasy using your own home to get the loan you need, closely tying your personal life to the risk of your organisation not being successful?

Does empowering your community to be the key part of your journey appeal to you? Is that sense of togetherness and belonging something that you want to create? Do you want to build your brand awareness and improve your organisation’s public profile? Do you want to show how innovative and inclusive a collective you are? Or do you want to find a sustainable way of raising money that you can come back to, to fund your exciting future plans?

 

Each company and organisation will have different priorities when it comes to these four factors. Take the time to reflect on what’s important for you, and with a clear mind, you’ll make the right choice.

International Inspiration & Home Truths: Craft Beer

Our series “International Inspiration & Home Truths” shares some of the crowdlending stories we’ve heard from across the globe, and brings that inspiration back to Aotearoa. You’ll find out what’s happening overseas, but also hear from some of the enthusiasts who’ve helped us to imagine what crowdlending could look like for a range of kiwi organisations. The second area we’re diving into is craft beer (one of our favourite things).

The UK is dominating the craft beer crowdfunding market

BrewDog are arguably leading the way internationally on the crowdfunding front. They’ve done four rounds of Equity for Punks, and have raised over £26million ($49million NZD) from 50,000 investors for their Scotland-started craft beer company.

It all started with two men and a dog. Their first pitch video in 2009 shows much younger, less hip versions of the founders James Watt and Martin Dickie. They stand earnestly in front of their brewery kit sharing their big plans for their beer.


Equity for Punks from BrewDog on Vimeo.

They took a huge leap, from starting in 2007 to becoming a publicly listed company in 2009. Their first round closed in February 2010 and saw the punk founders raise over £642,000 from 1,350 investors. Their early supporters not only got shares in the company, but also beer discounts and an invite to the annual general meeting, which you could literally call a piss up in a brewery. Though, now it’s a piss up over 10 different bars. Here’s a video recap of their latest AGM:


#PUNKAGM17 Recap from BrewDog on Vimeo.

Not ones to shy away from bold statements, in 2015 during their Equity for Punks IV round the founders took to a helicopter and dropped taxidermied “fat cats” onto the city of London. Over the following 12 months they raised over £19m from their crowd, making it one of the largest crowdfunding campaigns in history.


Equity for Punks IV – Death to the Fat Cats from BrewDog on Vimeo.

But, their latest move into the crowdlending space is arguably their most exciting move yet.

“This is funding for the 21st century”

Their BrewDog Bonds II were launched late 2016, and they raised their maximum goal of $10million from 2,699 investors in less than 30 days.


The BrewDog Bond from BrewDog on Vimeo.

Their mini bond offered their investors a 7.5% interest rate over four years, as well as beer discounts. The bonds were focussed on accelerating growth, both in the UK and in America where they are currently building a new factory in Ohio.

Today, Brew Dogs have held the title of the fast growing food and beverage company in the UK the last four years, and have been profitable since 2008. They have revenue exceeding $70million, over 800 “passionate people” working for them and 50 brew bars all over the globe.

Recently, BrewDog’s sold 23% of their company to TSG Consumer Partners for £213m, which gives their investors from their first round in 2010 a 2,800% return (though, they are capped at selling 40 shares in this round of shareholder buy backs).

And the UK influence has sailed across the sea to Ireland

You don’t have to be a monumental punk-backed beer behemoth to borrow from your crowd. Local independent brewery from County Wicklow (where Barry’s clan are from!), O Brother Brewing, borrowed a modest €20,000 from their crowd to expand their brewery and create an experiential tour for the passers-by.

One of the three-brother strong team, Padhraig O’Neill reflected on their experience “The idea of peer-to-peer lending really appealed to us. Promoting our business and the hassle-free process was great, it is the future of business finance.

Closer to home

While these have been intriguing developments in the Northern Hemisphere, we’ve been really excited about what it could mean for craft beer companies closer to home. Because craft beer and crowdfunding seem to be a match made in a beer-fuelled heaven.

We’ve seen two swift and well supported campaigns through PledgeMe for Wellington-based craft brewers. First up with Yeastie Boys, who raised their half a million goal in half an hour in 2015, followed by the Matts at ParrotDog raising their goal of $2million in two days the following year.

So we’ve asked some of our smart friends (and alumni) to tell us what they think. What could crowdlending mean for the beer makers in (or from) Aotearoa?

Who are you, and what do you do?

I’m Stu McKinlay, accidental entrepreneur, Benevolent Dictator and co-founder of Yeastie Boys. I make people happy with delicious beer in pretty designs.

What do you think about crowdlending?

My initial thoughts around crowdlending is that it’s fantastic to see the modern market adapt to the opportunities that present themselves from us being so connected. To me funding and lending through the crowd is simply an extension of the way many people used to fund businesses and projects, via their friends, but the process can be sped up now thanks to technology.

Could something like the BrewDog bonds happen in New Zealand?

It will happen in New Zealand! I have no doubts.

What are your concerns about crowdlending in New Zealand?

The concerns I have about crowdlending are pretty much the same as crowdfunding… simply that people are educated around what the risks and rewards are.

What excites you about it?

I’m always excited by things that create more opportunities for competition… crowdlending, like crowdfunding before it, gives so many more people the opportunity to build their business in a way that would not have been available to them a few years ago. With people who would have never known that the business even existed, let alone been looking for capital. It builds a community around business growth rather than having a bunch of banks doing everything.

 

Inspired? Curious? Want more than a sip? Chat to us!

Back to basics: How do you get started with a crowdlending campaign?

Lending can seem pretty scary, so we’ve decided to go back to the basics in this series and explain everything you need to know. We started with a brief history of lending and how lending works. Second up: how do you get started with a campaign?

What do you need to get started?

The first thing you need to check is your structure: are you set up as an organisation? Crowdlending the way we do it is only for those folk that have set up some form of organisation – be it a company, a school, a charitable trust, a co-op, a club.

The second thing you need to check is: will you be able to repay your loan? We’ll ask for some basic financial information in our CRED to check this, but you should be honest with yourself first. If you borrow money, will you be able to repay it? We don’t want to let you get into a situation where you definitely can’t repay your crowd.

Finally, you need to know what the money would be used for? How is it helping your organisation? The pitch to your crowd will need to be clear. Which means you need to be clear with yourself.

 

How does the CRED work?

Your journey begins with our Campaign Readiness Evaluation for Debt (aka the CRED). To get an insight into your organisation and your ability to repay the loan, we’re gonna ask you some questions. If you have your organisation’s financial statements at the ready, it will only take a few moments…five minute long moments to be precise!

The CRED works by pulling out a handful of financial measurements from your statements – the most important ones being how solvent your organisation is (have you funded yourself through equity and profits or through debt?) and the liquidity of the company (how effectively you manage your short-term cash flow). And your combined score from all of the measurements is compared to our ready / not ready threshold.

 

Steps to take

If you can tick the three boxes above, and understand how the CRED works, you should head along to PledgeMe.Lend and create a request. Here’s how you do that:

  1. First up you’ll be asked to complete your CRED as outlined above: https://www.pledgeme.co.nz/loans/cred
  2. Next you’ll be asked to fill out your basic lending request. Don’t worry, none of this information is set in stone!
  3. After that, we’ll be in touch to set up CrowdfundingU. If you’re a smaller campaign (under $100,000) we’ll just run you through a two to three session programme. If you’re looking to raise more, we’ll help you through the complete CrowdfundingU programme to make sure you’re ready to go out to your crowd in a big way.
  4. CrowdfundingU covers everything you need to do from creating your documentation, understanding how not to be false or misleading, learning how to create a comms plan, through to what you should include in your pitch video.
  5. Once all your content is created, we’ll do one final check on your page, your leadership team, and your plans. Then we’ll hit go!
  6. Before your campaign is live, you’ll need to have a plan around communication. Some comms will come naturally out of celebrating milestones, and some will be pre-planned (weekly updates, pitches to media, etc).
  7. Hopefully, you meet your goal by your deadline!
  8. PledgeMe checks all of your lenders (to make sure they are who they say they are) and sets up the loan contract between you and your new lenders.
  9. We’ll be in touch regularly, especially to remind you when your loan repayments are happening, and can help with any questions as you go.

How do you figure out your repayment terms?

Really, this is up to you. You can set the interest rate at something you think (or better yet, know) will be of interest to your crowd and is also affordable for you. We can help you figure out what the right balance for you and your crowd might be.

You can choose to repay your loan over one year, two years…anything up to five years. And you can choose to make repayments every month, four times a year, twice a year or once a year. You can also choose whether or not you want to secure your loan with specific assets that your organisation owns

What does it mean if you can’t run a campaign?

It doesn’t mean you’ll never be able to run a campaign! It just means right now it’s not right for you. You could look at running a project or an equity campaign, or just wait until your revenue and equity has increased (or your costs and liabilities have decreased) to a point where repayment looks possible.

Don’t take it to heart, we still think you’re pretty rad. Promise.

Got questions?

Hit us up in the comments below. We’d love to hear what you like, what confuses you, what else you need in this crowdlending journey. If you’d prefer to chat to one of us direct, send us a line on lend@pledgeme.co.nz

Being a director. It’s personal.

Our board member, Mel Templeton, reveals her story and the motivation behind her desire to help guide businesses with purpose and support founders who’ve got it all on the line.

How did you end up doing what you are doing now? Did you plan it, study for it, go after it, or did it just turn out that way?

I never planned my career.  I did well in my first industry (hospitality), ending up with my own business at 25, and two by 28. A few years later I needed a change, so I sold up and followed a keen interest I had in computers and marketing.

That was back in 2000. Again unplanned, I ended up in product marketing and then brand marketing in online banking. I happened to be good at most things I tried, and was whisked overseas by the global bank which was exciting and full of new adventure and challenges. Six year later, I found myself in the upper echelons of executive corporate management.

That was when it hit me. This wasn’t what I wanted to do. I couldn’t find enough value in what I was doing, never mind whether I was enjoying it.  

So for the first time ever, I started to think about what I wanted to actually do with my working days.

I got some good advice, a mentor, did some courses and finally settled on my personal purpose – to help people, businesses and communities thrive.  Being a company director seemed a natural fit between my skillsets and my purpose.  So I planned how to get there. And here I am!

I am currently on three commercial boards and one advisory committee, all in very different industries, and each with their own challenges and growing pains. For me, the pleasure is in being able to help in some way and I’ve tended to gravitate towards companies with a strong values base and real purpose to their existence, especially those that resonate with my own values.  

For me, being a company director is a personal choice. I choose to do this because I enjoy being able to offer an idea, support an initiative, help build something with other like-minded people, and work selflessly to help build success for a business. That includes success for the founder, who has often got everything riding on the success of their business. It makes me feel like I am contributing something worthwhile to the world, rather than just doing something because I can.

This drive in me to “help” is a personal thing and I’ve been fortunate to find a way to combine that inner drive, with rewarding work as a director.  Where will your inner drive take you?

 

Mel Templeton has been on the board of PledgeMe since April 2016, helping to guide and beef up the financial skill of the PledgeMe team.

Back to basics: How does lending work?

Lending can seem pretty scary, so we’ve decided to go back to the basics in this series and explain everything you need to know. First up: how does lending work?

A (very) short history of lending

Lending isn’t new by any means.

The first loans were lent in Ancient Greece and Ancient Rome, where pawnbrokers first started offering loans that were secured by animals and tools from the person borrowing. Through the Middle Ages the form of lending changed, including the introduction of indentured loans where the rich lent to the poor, who worked off those loans over time.

In the 18th century, Mayer Amschel Rothschild set up the first international banking system by sending his sons to five European cities to create a network for transferring money. Up until 2004 the Rothschild Bank Offices set the gold price daily.

In the late 18th century building societies started, where membership payments financed the building of member houses. Move forward to the 19th century and The Philadelphia Savings Fund Society was started so that everyday Americans could get loans and save money.

In New Zealand, the first colonial banks were started in the 1840’s. But, lending was not accessible or even seen as a function of the banks. Commercial loan-houses sprung up to fill the void, particularly for farmers who were unable to access funds. “Indeed the common subject of the talk of the settlements was the way in which the banks were retarding development. The matter was made the subject of special consideration by the Wellington Chamber of Commerce in 1858.” (Bedford, 1916). Sound familiar?

It wasn’t until the 1940’s that lending to individuals started in New Zealand, with the Bank of New Zealand (BNZ) opening “New Zealand’s first personal loans department to grant loans to private individuals”.

Modern technology started entering the banking sector in the 1960’s, with the first purchases of computers.  Since then, New Zealand has been at the leading edge of technology in finance.

But, what is a loan?

It’s an exchange of money.

You can think of it as “today-dollars” being exchanged for “tomorrow-dollars”. Someone who has money today but doesn’t need it, connecting with someone who needs money today but doesn’t have it.

The money is typically put towards something productive by the borrower (it could be goods to sell, or machinery to make something of value, or property) that will help to repay the money-giver (known as a lender).

The length of the loan is set so you know when repayments are to made, and the lender is usually rewarded with interest. To give your lenders a bit more comfort you can choose to use stuff to secure the loan – assets like machinery or property. If things don’t work out as planned and you can’t repay your loan, then that stuff gets given to your lenders as compensation.

How does crowdlending work?

Crowdlending rewrites the lending script. The usual single lender is turned into many supportive lenders. So instead of one financial institution lending money to you, your crowd become your  collective lenders. The interest that you choose to pay on your loan will reward your crowd, so that the benefit stays with the people that matter within your community.

Who can borrow money from their crowd?

Companies can borrow from their crowd through PledgeMe.Lend. Organisations (like schools, clubs, not-for-profits, co-ops and community groups) can borrow too.

The things you need to think about

When it comes to your crowdlending campaign the important things to think about are:

  • What will we spend the money on?
  • Can we repay the money borrowed? If that will be hard, it could be too risky to go down this route.
  • Who are our crowd? Are they excited about supporting us?
  • What would motivate our crowd to support? Interest? Extra rewards?
  • Can we dedicate time to create our campaign and tell our crowd what’s happening?
  • What do we want to get out of our campaign beyond money? Strengthening the bonds with our supporters? Publicity & awareness? Finding brand ambassadors who’ll share our story with their worlds? Creating a do-it-ourselves way for us to bring our ideas to life?

To suss out if a loan is right for you, ask yourself

  • Do we do something that generates money (sell stuff, run events, hire out your venue, have paying members), so that we can repay our crowd?
  • How much interest could we pay?

 

If you’re interested in learning more about crowdlending, sign up for our weekly digests on lending during the month of May.

 

References:

http://www.provenir.com/2016/07/history-of-lending/
http://www.teara.govt.nz/en/1966/banking
https://ourarchive.otago.ac.nz/handle/10523/4539?show=full
https://www.bnzheritage.co.nz/archives/historic-timeline/

International Inspiration & Home Truths: Community Energy

Our series “International Inspiration and Home Truths” shares some of the crowdlending stories we’ve heard from far and wide, brings that inspiration back to Aotearoa and hears from the enthusiasts who’ve helped us to imagine what crowdlending could look like for a range of kiwi organisations. First up is the transformative world of community energy projects.


How can a sustainably-minded community create a more resilient energy landscape for themselves? The Great Dunkilns community in Gloucester, UK decided to take the problem of funding into their own hands by, along with conscious investors throughout the country, collectively lending £1.4million to construct a community scale wind turbine on their turf. The energy produced is being used to power local houses, with the excess being sold back to the grid. The money earned from the energy is used to pay back their lenders their investment plus an annual interest rate of 7%.

 

There’s been some big government support in Britain too. Swindon Borough Council, to deliver on their vision of developing a low carbon economy by 2030, co-funded a common solar farm – the £1.7million contributed by the crowd was double-matched by the council.

How could empowered local communities power New Zealand?

Imagine, an off-grid wind turbine – built by and for the local residents of a wind-battered coastal community – being funded by that community and the many renewable believers all over both islands, North and South. Now imagine many of these renewably-powered pockets, from Dunedin to Wellington to Kaitaia, enabling New Zealand to achieve our goal of becoming the world’s first carbon neutral country by 2020.

We’ve seen a few great examples of clean energy crowdfunding through PledgeMe already, with Blueskin Energy crowdfunding to build a measurement tower, and Powerhouse Wind equity crowdfunding their single bladed wind turbine (below).

The enthusiast who’s inspired us

Renewable energy fanatic and our friend, Ian Shearer, first opened our eyes to the potential of crowdlending for community energy initiatives from his experience in the UK. Here’s Ian’s perspective on crowdlending:

What about crowdlending appeals to you?

I’m a community-minded person – always have been. I was involved with co-operative lending many years ago, which has partly paved the path for crowdlending. So that’s how I began to see the mechanism of crowdlending come together. But what really appeals to me is being able to invest in my passion, to invest in renewable energy.

What good things have you seen achieved in the community energy space?

What first brought me into the community energy world wasn’t necessarily my passion for renewables. It was my involvement with small communities in Scotland, and seeing the desire of these small communities to own their own the systems to enable them to power themselves. Community Energy Scotland were an extremely progressive organisation and they recognised crowdlending as the way to go to not just make community energy projects viable, but also to allow the people in the local area to benefit financially from the success of those projects. They were one of the first to take that step to help small island communities create and fund self-reliant wind-powered energy systems.

Biggest benefit beyond the money?

Collective ownership of something that matters to you.

Compared to the UK, what major obstacles do you see lying in the way of community energy crowdlending in New Zealand?

Two things really. A first successfully funded project that leads the way for others to follow. And secondly, once we find some traction, not being able to trade your investment may be an obstacle to grow the involvement of investors.

 

Are you inspired by what you’ve read, and interested in turning to crowdlending for your community energy outfit? Chat to us!

What's Up Wednesday

AgWomen Global

365 days. 365 women. 365 stories of influence.

AgWomen wants to celebrate the stories of women who help to shape the primary industries. So for a whole year, they plan to share a story a day, across their Facebook, Instagram and website, all culminating in a coffee table book containing the different profiles. They’ve already got over 100 names signed up, and have written and edited 30 stories, which they’ve begun sharing!

But to progress to the next step they need your help – so we chatted to “Agvocate” Chelsea Miller about why you should be supporting this ambitious project:

Why do you think this campaign is important?

We’ve created this initiative on the premise that no longer the theory of ‘tall poppy syndrome’ is a negative one, rather creates an opportunity to celebrate success and share the stories of women who help to shape the Primary Industry. It is about celebrating these women’s contribution, encouraging the next generation to follow in their footsteps and connect a global community of like-minded people who can celebrate their successes together. So often women’s stories are forgotten and we are about bringing them to the forefront, so others are inspired to lead, make change, and understand that they are an equal in a partnership which is heading in the same direction.

What motivated you to reach out to your crowd?

There are many organisations out there helping to educate women and bring them together in a social context, but so often their stories aren’t shared beyond their own communities. We want to change this with AgWomen Global. Not only do these organisations have rich AgWomen stories, they believe in our values and what we’re trying to achieve so wanted them to feel as though they are part of a bigger journey. This is another way they can support women and give them the confidence to excel, so that’s why we reached out to them for support through a PledgeMe campaign.

What do you have planned for the rest of the campaign?

We are starting to pull together the coffee table book from around June, ready for release in March 2018. There is a plan to get some more dynamic content produced to showcase some of the AgWomen stories, but is funds dependent. Ultimately though, MORE INSPIRING STORIES 🙂

Anything you want to shout out to your crowd?

A huge thank you to those who have already supported us, from pledging, through to wider communications to their networks, to those who’ve given names and stories for us to share. Without our crowd we couldn’t possibly deliver inspiration to the women of the world who are involved and want to be involved in the Primary Industry. We would merely be a name with no content. 

Our team thanks you for allowing us to share your success – you all inspire us every day!

To support AgWomen and help them keep on sharing success, pledge to their campaign right here.

Why are we doing Lending Month of May?

Here at PledgeMe, we’re launching a whole month of Lending related goodness. Why? Because we think lending has gotten a bit of a bad rep.

Over the month of May, we want to connect with Kiwis who are curious about crowdlending, and help demystify it for them.

How will we do that?

  • We’ll explain what it means in a super straight forward way; borrowing money doesn’t need to be as complicated as it’s been made out to be. We’ll compare traditional forms of debt to crowdfunded loans and we’ll also talk about the wider peer-to-peer space.
  • We’ll create case studies on how it has worked in the past.
  • We’ll host a webinar so we can answer your questions real time, and then blog about it.
  • We’ll be speaking at other people’s events (if you’ve got one, let us know!) and host our own.
  • We’ll be writing a weekly blog series showcasing how crowdlending can work for various companies and organisations (more on this below.)
  • We’re creating a podcast series
  • We’re putting together a mini-documentary on our people behind the bubble

First up: what is crowdlending??

Crowdlending is pretty simple. It’s going out to your crowd for funding and paying them back over time, on your terms. You’re in control. You choose the amount of your loan, the interest rate that you’ll offer to your crowd, the timeframe of your loan, whether or not you want to secure your loan and the additional rewards you’d like to offer to your crowd.

It’s a transparent process, and on our platform, PledgeMe.Lend, we focus on loans for organisations and companies (rather than for individual people).

We’ve so far helped two companies borrow from their crowds – Eat My Lunch and Denheath Desserts, who’ve collectively raised $1.2 million from their supporters – but we want to help more companies, not-for-profits, sports clubs and schools.

We think crowdlending is exciting because the interest is being earned by your crow and going back out into the community.

Who’s crowdlending for?

Crowdlending can be for any company or organisation that has a crowd and could repay a loan to their crowd. It’s for those that would prefer to reach out to those people (and reward them) rather than going through a more traditional borrowing process.

It’s for organisations that have been operating for a couple of years, are revenue generating and preferably profitable, and have some equity on their balance sheet. It’s for organisations who’ve built a community of followers around them and want to activate that crowd.

Who are we?

Barry is the main person behind PledgeMe.Lend. In a past life, he was a banker. He’s taken his insight into how things have traditionally been done, and created a more inclusive way for organisations to borrow to fund the things they care about . He wants to help us reimagine debt: to see a loan – when used simply and honestly – as an enabler, that allows an organisation to take opportunities for themselves and make opportunities for those around them.

What we’ve seen happen around the world?

To help demystify crowdlending, throughout the month of May, we’ll be sharing stories of what’s happened overseas, and showing how those examples could work in Aotearoa as well. Like:

  • Intrigue Chocolate in Seattle raised over $40,000USD to improve their retail space as 85% of their shoppers were from foot traffic. Now, imagine a chocolate factory in New Zealand looking to expand their exports or improve their shop.
  • The Art of Coffee in Dublin borrowed €7,200 to buy a top-of-the-range sandwich machine and discovered a crowd of new customers along the way. Could a local kiwi cafe activate their crowd of customers to help them buy a brand-spanking new roaster to enhance the coffee experience they’re creating.
  • BrewDog are leading the way in the crowdfunding world, and their BrewDog Bonds last year are no different. What would it look like for a craft brewer in New Zealand to borrow money to make more beer with new fermentation tanks and bottling machines?.
  • Hertha Berlin Football Club in Germany raised €1million in ten minutes to refresh their online identity. Imagine if a sports club here went to go out to their members and fans to help refurbish their facilities.
  • Stellenbosch Waldorf School in Capetown raised 363,400 South African Rand to fit their school building with solar panels. Imagine if a New Zealand based school kitted out their roof with solar panels to help energise themselves and power some extra eco-education for their students.
  • Evergreen Escapes borrowed $25,000USD to create a hub for travellers to come together to learn, chat, share and plan. How about a not-for-profit food catering social enterprise closer to home buying a food-truck, so that they can serve a wider audience, without being held back by their inability to issue shares to raise equity funding.

If you haven’t already, you can go to our lending landing page and sign up to our newsletter list to get the content first. You can check out all our previous content there as well.

We’re always more than happy to chat about how this could work for you, so if you’ve any burning questions feel free reach out to Barry at lend@pledgeme.co.nz.