COVID-19 has changed the world for all of us, and we hope all of you are staying safe, healthy, and continuing to flatten the curve by social distancing responsibly. Unfortunately, the climate crisis looms large and much closer on the horizon than many people realize -- it’s the next big curve that must be flattened.
Last week, coinciding with the 4 year anniversary of Regulation Crowdfunding, we had the opportunity to host a webinar with the Raise Green community. Not only did we receive super insightful and interesting questions from our attendees, we also unfortunately maxed out the participants allowed by the Zoom platform! We are humbled and grateful to have had this “problem” on our hands, but we apologize to anyone that wanted to and was unable to attend. In response, we are posting a recording of the Raise Green webinar here. Take a listen!
While our webinar provided an opportunity for many of you to ask some great questions and receive answers, there were definitely a handful of frequently asked questions -- and this blog shares those great questions and short answers below. Please give them a read, and don’t hesitate to continue the dialogue directly with us by tweeting or posting at us @RaiseGreenInc or emailing us at firstname.lastname@example.org.
Stay tuned as our next webinars are around the corner - diving into Originators on June 10th, and shortly thereafter, Impact Investors. To make sure to get the most up-to-date information on these, please consider signing up for our email list and follow any of our social accounts (Instagram, Twitter, Facebook, LinkedIn). We will be sure to blast all of these leading up to our upcoming webinars, so follow them if you don’t want to miss out on some great content!
6 Frequently Asked Questions from the webinar:
What are the risks involved in impact investing and how are these risks managed?
Like any financial investment in a company, impact investing has risk. Each investment must be reviewed for its unique potential returns and risks of loss, which can be all of your investment whether debt or equity. Raise Green performs certain due diligence prior to listing a company on the funding portal. This includes ‘bad actor checks’ on all Originators, and ensuring each potential Investor has access to a formal write-up by the Company that lays out its business case and discloses specific risks to investors. It is very important that prior to investing, each investor reviews all these materials to determine if the investment is appropriate for their particular financial objectives and circumstances. More generally, Raise Green requires Investors to review certain educational materials about Crowdfunding risks prior to opening an account, and we limit an Investor’s total dollar invested as required by our Regulators. Learn more about the process and risks here: https://www.raisegreen.com/faq
When we look beyond solar, e.g. to regenerative agriculture and carbon sequestration projects, or regional CSAs, what do you see as the key similarities and what do you see as key challenges for something that isn’t as easy to model?
Raise Green is set up to facilitate the financing needs for any type of clean energy or climate solution company, but we’re focused initially on solar. Just like Amazon started with the storing and selling of books online in the early 1990s before expanding to the vast online marketplace we see today, Raise Green is targeting solar projects before expanding to a larger marketplace for any and all climate solutions. Our business model works best with projects that have a contractual cash flow (like a Power Purchase Agreement). As long as projects pass our due diligence, which starts with the RAISE Model, and they’re looking to bring a climate solution to their community, we are glad to work with your company to raise inclusive financing. Get started here: https://www.raisegreen.com/originator-program
How can contractors and developers integrate Raise Green’s financing options into their workflow?
Raise Green encourages contractors along the project development pipeline to reach out and join as enterprise partners. We have many enterprise partners already for solar installation, engineering, procurement and contracting, banking, accounting, insurance, tax-equity, and more. If you see a role for your company or yourself as a contractor in helping provide services or equipment to motivated local project developer-Originators, reach out to us at email@example.com! Of course, contractors and developers could decide to be the Originator of a project company as well.
What SEC registration exemptions are available for crowd sourcing in general, or for ‘Raise Green’ projects specifically?
Raise Green is a licensed Funding Portal with the SEC and FINRA, which means that it is authorized to serve as an intermediary in a transaction involving the offer or sale of exempt securities in reliance on Section 4(a)(6) of the Securities Act. This means that Raise Green can conduct offerings of a variety of security types (debt, equity or others) for private companies incorporated in the U.S. under Regulation Crowdfunding (Reg CF) looking to raise capital. And, this allows a new or existing company to raise a maximum aggregate amount of $1,070,000 through crowdfunding offerings in a 12-month period. Read more here: https://www.raisegreen.com/faq
Can investors receive tax incentives that follow renewable installations? Can you describe in more detail about the “access to tax equity investment”?
The Federal Investment Tax Credit and accelerated depreciation benefits are important incentives that help improve the economics of clean energy projects. Unfortunately for many community-scale projects and non-profits, these incentives are difficult or impossible to access due to complexity or lack of sufficient tax-burden to effectively capture the value. Raise Green does not offer financial, tax, accounting or legal advice in any way, however we do provide assistance to access enterprise partners that can help Originators get their projects up, funded and running. One of those enterprise partnerships is focused on tax equity, so if you’ve got a project that you’d like to list on Raise Green, and you’re interested in capturing tax equity investment and accelerated depreciation benefits, please reach out to us at firstname.lastname@example.org so we can assist!
What are the benefits and challenges for an originator to create a project through Raise Green as compared to financing through a solar outfitter?
Raise Green enables individuals to create their own green job, and create local economic development, opening up the possibility of community ownership of solar projects. Typical solar outfitters offer two main financing options: either a loan (which can have interest rates close to 7-9 percent or higher); or a third-party owned Power Purchase Agreement model where their company owns the solar system and sells electricity at a fixed rate to the off-taker.
Raise Green’s model for community-scale solar projects enables a local Originator to create, finance, build and run their own project which allows them to set their own financing terms, and inclusively finance their project bringing in impact investors as owners or lenders to replace the traditional bank or third-party owner. This means that the Originator and their crowdfunded local community climate company have more autonomy and flexibility in managing the project. It also means that the Originator is responsible for managing that company over the solar infrastructures expected life. They ensure that the system is built and maintained, and that the Crowdinvestors are getting paid back as the project generates and sells electricity through their Power Purchase Agreement. Of course, as mentioned above, the Originator can choose to bring in service providers, we like to call enterprise partners, to help with any and all phases. Raise Green’s inclusive finance approach enables communities to create, own and benefit from the solutions to climate change.
This is not a Research Report, should not be construed as investment advice, and does not constitute a solicitation to sell or an offer to buy securities relating to any products referenced herein Past performance is not indicative of future results. This blog represents a business discussion only and the views of individuals at Raise Green. Investing in Crowdfunded investments is risky and speculative. Please see FAQs on this Site for more information.