Crowdfunding platform bettervest celebrates another milestone by partnering with the African Guarantee Fund. This partnership will allow mitigating the risks related to impact investing.
Impact, risk reduction, and profitability: these are the three key features of bettervest, a crowdfunding platform from Frankfurt, Germany. Bettervest seeks to achieve the largest possible sustainable and social impact, without customers having to sacrifice a stable portfolio and attractive returns.
The crowdfunding platform’s projects in emerging markets aim to provide clean, affordable, and reliable energy services and support small and medium-sized enterprises (SMEs). Furthermore, bettervest’s key objectives include democratizing the investment market, closing the financing gap for SMEs in emerging markets, and reducing the environmental footprint.
The impact of bettervest crowdfunding
Since bettervest started in 2012, more than 22 million euros have been invested in over 110 impact projects. These have been implemented in more than 20 countries and four continents, primarily in Africa (52%) and Europe (42%).
In addition, bettervest’s projects have contributed to fourteen of the United Nations’ 17 Sustainable Development Goals (SDGs). All projects cover SDG13 “Take urgent action to combat climate change and its impacts”. Seventy-one aim to improve conditions in the area of “Affordable, reliable, sustainable and modern energy for all” (SDG7). Moreover, thirty-six projects contribute to the goals of “Health and well-being” (SDG3) and “Decent work and economic growth” (SDG8).
Beyond that, the platform’s projects cumulatively created nearly 2,000 new jobs and contributed to the electrification of over 45,000 homes. This was done through sixty-three off-grid projects, of which forty-two represent Energy Access projects.
A new solution for crowdfunding risk minimization
It was a very successful start of the year for bettervest which has partnered with the African Guarantee Fund (AGF) on a number of projects in Africa. The AGF will provide partial guarantees requested by bettervest on a risk-sharing basis for defaults under credit facilities for African SMEs.
The AGF is a specialized guarantor with a mission to facilitate access to finance for SMEs so that they can fully play their role as drivers of African economic growth. To achieve this, the AGF provides partial credit guarantees and capacity-building support to its partner financial institutions. So far, the AGF has provided over $1.5 billion in guarantees. Those have unlocked more than $3 billion in SME financing through its 200 partner financial institutions in 40 African countries.
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The goal of this partnership is to further increase the attractiveness of impact investments. Making a valuable contribution to the planet and countless people. As with any type of investment, impact investing is not free of any risks. If – worst-case scenario – a project fails, investors lose their investments. The African Guarantee Fund’s partial guarantee will help mitigate that risk.
bettervest outlook for the future
Bettervest is receiving more and more support from citizens who want to invest their money in a more meaningful way. This topic was also picked up by the German television channel ZDF as part of their show “plan b”. In the report “Money is not everything – Investing in good causes – (“Geld ist nicht alles – Investieren in gute Zwecke) bettervest and one of its Project Owners in Kenya, BURN Manufacturing, are interviewed and presented as one possibility for sustainable investing.
Furthermore, bettervest has now expanded its product portfolio. It now includes bonds as well as co-financing by institutional and other larger investors. Given this success, the crowdfunding platform hopes that it can continue to shape the future in a more sustainable way. Increasing its impact a little bit further every year.
For more information about bettervest and its impact projects, you can check its website.
Editor’s Note: The opinions expressed here by the authors are their own, not those of Impakter.com — In the Featured Photo: The BURN Project supported by bettervest. Featured Photo Credit: bettervest.
