Investment management company Downing has formed a partnership withScotland based ShareIn to launch a crowdfunding platform targeting advised clients. The initiative was inaugurated with a crowdfunded bond offer that was tested with a small number of intermediaries. According to Downing, the offer registered pledges of approximately £1 million in just 24 hours. Downing is now said to be pushing ahead with the full public launch of its first bond in the next few days: a solar bond raising £3.2 million.
Downing CEO Tony McGing explained his company will apply the same level of due diligence on their crowdfunding offers as they do on their normal venture capital business.
“Crowdfunding has to date been a direct to public market, growing rapidly in size with £2 billion lent to UK businesses in 2015 alone,” said McGing. “Downing will also open up this market to investors who are keen to participate, but want the reassurance that the opportunities have been assessed by their financial adviser and are brought to market by a highly respected provider. Downing will provide those advisers with both the information and the incentive they need to do so.”
Downing’s investment strategy is to invest in asset-backed businesses where the infrastructure is already in place and the company is already profitable. The conservative approach has seen over £1.7 billion raised and invested via its services. Downing has also invested over £350 million in renewable energy including £150 million in solar.
“Downing has put together a proposition that will open up crowdfunding to a new audience. As EIS incentives are refocused on higher risk businesses, retail investors, SIPPs and next tax year’s Innovative Finance ISAs are a natural source of funding for more mature companies that can potentially offer better risk-adjusted returns.”
Jude Cook, founder of ShareIn the company that is providing the software to power the new site was quoted in the Scotsman on the project;
“We are thrilled to be working with Downing to deliver this crowdfunded renewable energy bond. It’s the first time our platform has been used for bonds and it marks a significant addition to our product offering.”
ShareIn has recently pushed into Fintech/Crowdfunding services and migrated away from listing offers directly on its site. Recently ShareIn partnered with Hibernian FC to fan-fund the struggling club.
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