Two online crowdfunders are merging to offer the biggest social enterprise platform in the UK.
Buzzbnk and Trillion have a user base of 14,000 investors and access to potential funding of up to £500 million.
They hope to have the merger signed and sealed by September 1, 2014.
The new business will pitch debt and equity alternative investments to ethical investors seeking high returns.
Fashion designer Dame Vivienne Westwood is one of the behind-the-scenes backers of the venture. Other backers include The Esmée Fairbairn Foundation and The Tudor Trust.
Buzzbnk already owns and manages the latest technology behind the Trillion online platform which was introduced in June 2014
Trillion chief executive Julia Groves will run the combined business, with Theresa Burton, co-founder of Buzzbnk, as her deputy.
Social investing
Julia Groves said: “By combining, Trillion and Buzzbnk will bring a crowdfunding resource of real scale to the market.
“Social investing as a concept is about people making ethical investments for the good of everyone and the planet, not just investment returns.
“We plan to start with projects involving a clean energy infrastructure for Britain.”
The merger is about combining forces to make a real difference, explained Theresa Burton.
“Both platforms are complementary. We will offer seed capital to start up social enterprises and growth funding to projects starved of cash flow. We want to make social enterprises that can stand on their own and be successful.”
Buzzbnk was Britain’s first social enterprise crowdfunding platform, while Trillion is a crowdfunder specialising in renewable energy.
Since launching in 2011, Buzzbnk has financed more than 100 projects with a 63% success rate.
Community projects benefit
Besides funding British social and community projects, Buzzbnk has also raised money for pitches for aid to India, Malawi and Gaza.
Buzzbnk projects typically give investors rewards from investing, interest on loans or earnings based on sales.
Trillion has assisted 20 projects with peer-to-peer funding, equity stakes, funds, debentures and bonds averaging around £500,000 a case.
Recent Trillion projects have offered investors a 7.35% internal return to install solar panels in Kent and a 9% internal return on financing a wind turbine in Cornwall. Trillion points out that returns are variable and depend on project-specific factors.
The government is also targeting social enterprise investors with the Social Investment Tax Relief (SITR) and Community Investment Tax Relief (CITR) – both of which offer generous tax breaks to investors financing ethical projects.
