Abundance investment

Idea

Introduction

The urgency to act on climate is now a matter of consensus, not contention. The calls for a green recovery have been coming from across the political divide. Leading economists agree on the need to build a sustainable future and the government is targeting Net Zero by 2050.

It is no longer a choice of where we are headed, but how fast we travel. We believe that we have the power to accelerate the transition to a green economy, if people play their part. And we know that 8.7m altruistic investors want to put their money to work to help make that happen.

Abundance lets anyone mobilise their money for good. We help people get directly involved in the transition to Net Zero in a way that also fits their financial needs. Our investors are leaders in the fight to tackle the climate emergency, by putting their money to work backing everything from councils to turbines to green-tech innovations.

The opportunity is enormous, the impetus to change is strong. And we are ready.

Substantial accomplishments to date

Abundance is one of the original innovators in UK alternative finance. We have blazed a trail in an often arcane sector by focussing on making money do good, not chasing short term gains.

We became the UK’s first regulated crowdfunding platform in 2011, launching in 2012 with the UK’s first ever regulated crowdfunded wind turbine. But we didn’t stop there. In our journey to transform the UK’s alternative finance market, we have added new financial products, the Innovative Finance ISA, and our pension (SIPP). And in July we launched another UK first with our new Community Municipal Investments; our first investment with West Berkshire Council already has over 400 investors.

We have grown one of the UK’s leading green and ethical investment platforms with a passionate, engaged base of 6,800 customers who share our desire to create a better world, while also meeting their financial needs. This ‘win win’ approach to investing is at the heart of what we do.

Our progress since our last raise
Since we last raised money on Seedrs in late 2018 we have made good progress despite challenging conditions, and are now well placed to scale up to take advantage of the opportunities that lie ahead.

- Became a B Corp
- Passed £100m raised
- Grew customer numbers by 30%
- Funded our first green housing investments
- Developed our online service offering with an upgraded portfolio dashboard and improvements to our marketplace
- Launched our first two CMIs with West Berkshire and Warrington

Monetisation strategy

We generate income via two fees which we charge issuers: upfront fees for marketing investments, and ongoing contracted admin fees over the investment lifetime (2020 expected total; £972k of income). We operate our business across two channels.

Funding the Net Zero transition

We offer direct investments in the innovative companies that are creating our greener future. We have already put over £100m into green energy and green social housing, but there is more to do. We have a pipeline of investments across new sectors - including farming, food, and broadband - to lead the transition to a better future.

New council investments

We launched the UK’s first CMI in July. They are a scalable solution to a customer need for low risk, high impact investments, and let us market our products to millions around the UK.

Councils across the 4 nations of the UK are excited by CMIs - not only for raising funds, but also engaging the power of communities. With £9bn of lending to council in 2019 the potential is huge.

Use of proceeds

Abundance aims to play a major role in accelerating action on the climate emergency - at local and national level - and creating positive change to the world of investments. This £500k raise will set us up to achieve this.

Establishing CMIs as the way to fund councils and engage citizens

We will invest in rolling out CMIs. We expect to launch with 4 councils in 2020. We will use local marketing activity to maximise engagement and prove that CMIs are scalable.

Cement our leading position in Net Zero investments

We will continue to grow our core business, by backing new companies in a diverse range of sectors to accelerate our green transition. We have built a loyal customer base, and our technology is ready to scale, so we will build on this solid foundation.

Find partners to go faster with a bigger raise next year

We will invest to secure a strategic partner that enables us to grow more quickly so, over the next decade, we become a key part of accelerating the transition to Net Zero.

Please note that the company has £51k of non-interest bearing loans from NEDs. Funds raised will not be used to pay these loans.

Convertible key terms

The key terms that apply to the Abundance advanced subscription agreement are set out in the Key Terms Document attached to this campaign in the Documents section and a summary is set out below.

Conversion of the advanced subscription agreement will take place:
• On a Qualifying Equity Fundraise of £1,000,000 or more, at the lower of (i) a 20% discount to the share price paid by investors in the Qualifying Equity Fundraise, or (ii) the share price based on a valuation cap of £25,000,000 (the discount does not apply to this valuation cap).

• If no Qualifying Equity Fundraise has occurred, on the “Longstop Date”, (which will be 12 months from the date of the agreement), or a winding up event, conversion will happen on the Longstop Date or the winding up event at a share price of £2 (this was the share price of the company's last funding round and equates to a current company valuation of £20,209,938), or, if lower, the price per share issued after the date of the deferred subscription agreement.

• If a change of control or IPO occurs prior to the above events, conversion will automatically trigger at a price per share which is the lower of (i) the lowest price per share issued or sold as a part of an IPO or change of control, discounted by 20%, or (ii) the share price based on a valuation cap of £25,000,000 (the discount does not apply to this valuation cap).

EIS eligibility: HMRC provides guidance on advanced subscription agreements and EIS eligibility. This guidance stipulates a 6 months longstop date, whereas this ASA has a 12 month longstop date. We intend to apply for EIS relief as we understand there may be flexibility given the impact of coronavirus, although this cannot be guaranteed. Investors should seek their own advice if this is material to their investment decision. Seedrs cannot provide tax advice. Tax treatment depends on individual circumstances and is subject to change in the future.