Crowdsourcing solar energy
SunFunder is a San Francisco and Tanzania-based crowd-funding start-up to raise and aggregate capital for the budding solar-energy movement in ‘off-grid’ or ‘grid-deficit’ developing countries.
It raises short-term working capital and project finance for solar-lighting, phone-charging, micro-grids and diesel-replacement projects, arguing that on the basis of current, coal-fire energy investments, one billion of the world’s poor will still be without energy access in 2030.
Founder Ryan Levinson, who launched the company after a stint developing Wells Fargo’s solar energy investment business as their VP of environmental finance, says solar has the potential to leapfrog other energy sources in the same way that mobiles have leapfrogged landlines. But ‘sustainable, commercially oriented models are needed to achieve the scale, and mobilise the amount of capital to truly move the needle on addressing the big challenges of energy access and global warming,’ he says.
The site targets both institutional and individual investors, and since 2012 has brokered close to half a million dollars in loans with a 100% repayment rate. Instead of interest rates, investors are reimbursed with impact points that they can invest again via the SunFunder platform, either manually or via the site’s automatic revolving investment function.
Levinson highlights the team’s strong track record in managing solar investments and due diligence processes. SunFunder takes a small capital sourcing fee and a slice of interest to cover online transaction costs, but also match-funds every investment. The minimum investment is just $10.
The site is well positioned to take advantage of leaps both in solar, and crowdfunding—both of which are ideas whose time has come. Solar no longer needs subsidies to be economically viable, and where the 30 largest crowdfunding sites raised $1.5bn in the past five years, they were projected to net $3bn in 2013 alone. Participants say that crowdfunding not only raises capital for solar start-ups faster than traditional investment vehicles, but it also gives their profile a boost: investors are more likely to share the story of projects they’ve invested in via social media or word of mouth.
Image courtesy of SunFunder
Last updated: 25th of June, 2014